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The Lehman Echoes Are Getting Steadily Louder

The coronavirus saga is starting to follow the outlines of the 2008 credit crisis. 

Let’s start with the day’s most remarkable market event, which was a rise of 34 basis points in the 10-year Treasury yield, probably the world’s most important financial benchmark. 

That was its biggest daily move since the summer of 1987 (when the yield started as high as 8%). This was a historic move out of bonds.

On Tuesday, the Federal Reserve said it was reactivating a 2008-era program to support commercial paper issued by companies — essentially to ensure that scarcity of short-term funding doesn’t force some large company to fail to meet its payroll, and take the crisis to another level. 

John Authers Bloomberg 18 mars 2020 

Lehman Brothers

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