It's no coincidence that the recession's grip is easing now that credit conditions show every sign of loosening up. By many measures, financial markets are functioning as they were prior to September of last year, before the collapse of Lehman Brothers and American International Group. The panic following those events essentially shut down the credit markets, as investors fled any asset with risk attached, even historically safe money-market funds, for the guaranteed safety and liquidity of Treasury securities and cash. Now, an improved flow of credit is helping lay the groundwork for a recovery.
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