The Looming Bank Collapse - Demand shifted to a similar—and similarly risky—instrument, one that even has a similar name: the CLO, or collateralized loan obligation

The reforms were well intentioned, but, as we’ll see, they haven’t kept the banks from falling back into old, bad habits. After the housing crisis, subprime CDOs naturally fell out of favor. Demand shifted to a similar—and similarly risky—instrument, one that even has a similar name: the CLO, or collateralized loan obligation. A CLO walks and talks like a CDO, but in place of loans made to home buyers are loans made to businesses—specifically, troubled businesses.

The Looming Bank Collapse

The U.S. financial system could be on the cusp of calamity. This time, we might not be able to save it.

https://www.theatlantic.com/magazine/archive/2020/07/coronavirus-banks-collapse/612247/

https://www.theatlantic.com/magazine/archive/2020/07/coronavirus-banks-collapse/612247/