More Crisis Mongering

I'm beginning to feel like the mouthpiece for the complacency lobby, but we continue to see baseless articles in prominent places telling us that another financial crisis is imminent. The latest entry comes from Steven Pearlstein at the Washington Post, warning us that "The junk debt that tanked the economy? It's back in a big way."

The villain in this story is collateralized loan obligations (CLO). These are securities that put together a variety of loans and then are sold off in tranches. T...