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Waterfall’s Jack Ross Talks Structured Markets: Credit Crunch

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The Risks of High-YieldDefault Rates in the Structured Credit Market

On the corporate side, you've been seeing threats from high-yield default rates ticking up on our end. Are there particular areas of the structured credit market where you're seeing some elevated risk and if so, what do you see as the biggest threat? The CLO market is just a play on leverage loans. We haven't had a default cycle with the preponderance of covenant light loans. It's going to take them the individual lender longer to get at the borrower because they're not going to hit a covenant early enough that you can restructure the situation.

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