Editor's letter

The Bank of England's £50 billion scheme allowing banks to swap mortgage assets for government bonds was welcome news. Any intervention providing liquidity while the market remains stricken by the absence of cash is positive, but it is vital that the Bank - and financial institutions in general - does not confuse symptoms and causes.

The market is paralysed by a general lack of confidence, which explains the basis between interest rates and Libor. Until trust returns, this state of suspended animation will endure and the biggest news will continue to be about writedowns, not deals.

Readers will have noticed that our secondary market liquidity survey didn't appear in the April issue of Credit and it doesn't feature in the May edition either. We are continuing our efforts to improve the sample of buy-side accounts we poll for the survey, but the response we get from investors has fallen off dramatically since the turbulence in credit struck last summer. Rather than publish data based on the opinion of a very small (and thus potentially skewed) sample of respondents, we have decided to pull the survey for the next few issues. We hope to include it again when conditions improve.

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