The beginning of September was wracked with uncertainty as Fannie Mae and Freddie Mac struggled with liquidity issues. That was until the government stepped in with a bailout plan for the GSEs. However, the government cannot stop growing fears of mounting losses at Lehman Brothers, which continued last week.
ABS market participants expressed that a comeback in the consumer ABS space would probably not happen anytime soon. The secondary market remains quiet and new issue volume is lackluster.