As the market continues to have a very bad taste for bad debt, I believe we will see more stories like the one below.

IMO, the majority of EDIG's mean ole copy cats play in the consumer world and that world needs a decent Holiday Season for many to survive. The rumor mill is rampent with BIG boy retailers and brands not looking good as they head into Black Friday.

We'll see.

John

November 19, 2007, 5:32 pm

Posted by Dana Cimilluca (Wall Street Journal on line)

The most recent bout of credit-market turmoil will likely claim another victim.

The $4 billion sale of loans backing Cerberus Capital’s August purchase of Chrysler that was to take place this week will likely be postponed, a person briefed on the matter tells Deal Journal. Orders for the paper were due today, and so far, demand has been sluggish. (The underwriters are J.P. Morgan Chase, Citigroup, Goldman Sachs Group, Morgan Stanley and Bear Stearns.)

This person cautions that a final decision won’t be made until Tuesday morning and that a small portion of the loan sale is a possibility this week. Still, even that is looking increasingly unlikely as the Thanksgiving holiday approaches.

How times have changed. The successful sale of $6 billion of loans tied to Chrysler’s finance arm in late July signaled that the high-yield market was on the mend after investor demand plummeted starting in June. Now the credit market has gone into reverse and the auto industry isn’t faring much better. Chrysler, for example, is grappling with tepid U.S. sales as the housing market sinks and fuel prices soar.

Chrysler’s woes are the latest setback for Cerberus, which went on a buying binge early in the year when the credit markets were booming. Now it faces a rough road at Chrysler and the GMAC auto-finance business it bought from General Motors last year, not to mention its effort to walk away from its pending buyout of United Rentals.

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