Liquidity Kills: Market Perception of Funding Risk in a Post-crisis Environment

Wednesday, March 23, 2011 - 4:30pm - 6:00pm EDT

  • Location:Dibner Building, LC 400
    Five MetroTech Center, Brooklyn, NY

A Morton L. Topfer Chair Lecture Series Lecture

Presented By

Guy Lebas

Chief Fixed Income Strategist
Janney Montgomery Scott

Abstract

More than any other financial crisis during the last century, debt, leverage and liquidity have played a critical role in the 2008 market collapse. The market experience throughout that time period gave birth to a new adage: Falling revenues smart, weak balance sheets maim, but poor liquidity kills. Since that time, external liquidity has improved significantly and corporations have become increasingly aware of the long-term cost and short-term risks of maintaining poor internal liquidity profiles. As we face the end of a resurgence in credit markets, one of the biggest questions in practical finance today remains whether the markets are pricing liquidity risk efficiently. Guy LeBas will examine the issues from a practical perspective using market signal, credit rating and case study evidence.

About the Speaker

Guy LeBas is chief fixed-income strategist at Janney Montgomery Scott. LeBas authors in-depth economic and bond market periodicals and provides relative-value recommendations across the fixed-income spectrum. He is a frequent guest on CNBC, Bloomberg TV, and other media outlets. Prior to joining Janney, he was the interest rate risk manager for U.S. Trust’s bank asset and liability portfolios, a role in which he oversaw risk and return on an $11 billion balance sheet. He received his education from Swarthmore College, and the University of Pennsylvania’s Wharton School of Business and is a CFA Charterholder.