Reversal of fortune

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This month’s chart, provided by Robert McAdie, global credit strategist at Barclays Capital in London, shows monthly trading volumes in the cash bond market versus the market for single-name credit default swaps and credit derivative indices. The chart shows that while liquidity in cash instruments has all but dried up, the credit derivatives market has seen a dramatic increase in activity. McAdie says, “There has been a total sea-change from the use of cash bonds as an instrument to source

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