by Structured Settlement Watchdog
“The problem, as for exchange rates, is also the speed of the movement,” he warns. “If spreads keep widening then markets could more quickly lose confidence and the problem would be the quantity of available financing, not the cost." -Marco Annunziata the chief economist at UniCredit bank in Italy.
Taipan Publishing's Andrew Snyder "Just like the fall of 2008, we face a massive liquidity crisis with the potential to stop the world’s economy in a heartbeat".
By late 2008, the liquidity crisis began to seriously affect the ability of the structured settlement factoring industry to fund their deals on time.
One of the most notable for structured settlements was the so-called "Connecticut Woman Story" which involved a factoring deal referred by an NSSTA member broker, that started in October 2008 and ended up taking almost 7 months! Other deals at the time with the Connecticut Woman's funder, Structured Asset Funding, took even longer according to complaints then posted on the TrustLink website. The largest factoring company JG Wentworth's liquidity problems resulted in a prepackaged Chapter 11 bankruptcy filing in May 2009.
The big names and the big advertisers rely on institutional financing from European banks, the same folks that are schvitzing over "Greeced PIIGS* "
Read Bank Funding Crunch Deepens As Swap Rates Soar: Credit Markets-Bloomberg News
* PIIGS is described in Wikipedia as "a pejorative acronym for the economies of Portugal, Italy, Ireland, Greece and Spain, a group of five Eurozone countries whose credit diffculties have been well published in recent times
Leave a Reply