Column - Amy Falls
With the markets grinding to a halt, now is the time for investors to show discipline and observe the three golden rules of liquidity management
The past few months have brought harsh reminders about the importance of liquidity in risk management. Whether it is cash that doesn't act like cash, poor matching of assets and liabilities, or blithe assumptions about the sustainability of leverage, a world awash with liquidity encouraged sloppy liquidity management. Now, periodic seizures in the credit markets have inflicted sharp and sometimes lethal punishment on those investors that failed to manage operational and asset liquidity prudently
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