The torrid pace of deals churning from the industry coined "CDO machine" this year is making last year's record issuance look like a warm-up round. Total dollar volume in the U.S. CDO market was up 96% in the first eight months of this year compared to the same period last year, according to Deutsche Bank. The number blew past the broader ABS market's feeble 0.05% gain over 2005 issuance at this time last year.

The wave of CDO issuance has brought with it new asset managers, a broader base of investors and busy rating agencies - whose analysts have been taxed with judging the risk involved with a plethora of new structures and collateral types.

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