Squeeze, crunch, munch

The liquidity squeeze has advanced the retirement plans of Stan O’Neal and Chuck Prince. For investors, the departure of the bosses of Merrill Lynch and Citigroup is now history. The big question for the future is whether the squeeze will turn into an economy-munching credit crunch. Citi’s announcement of an anticipated additional $8-11bn charge on its US mortgage portfolio – after only $1,6bn in the third quarter – only confirms the message from the ABX indexes of mortgage-backed securities: l...