Investors fled the commercial paper market for safer investments like Treasurys. As a result, the system of short-term IOUs that had funded SIVs was thrown into turmoil.
SIVs lost access to the money they needed to finance their own investments. Some were able to tap bank credit lines; others were forced to sell their assets to make payments on maturing paper.
Funding mismatch: SIVs in a bind
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