Today's "Link of the Day" once again looks back 10 year ago, when the Subprime Liquidity Crisis was taken up another notch with the freezing of ARS, or auction rate securities. We wrote on Feb. 3, 2008 the news update, "Auction-Rate Securities Cover Headlines With Bristol-Myers Squibb Loss. The decade-old piece explains, "The broader investment world is getting a crash-course in the arcane world of auction-rate securities as news of Bristol-Myers Squibb's $275 million impairment charge on an investment of $811 in ARS hit the wires this week. (See our "Link of the Day" and the Bloomberg article.) Auctions began failing in August, causing these securities to turn into longer-term holdings and causing an exodus from the formerly $300 billion sector. Though just 2% ($6 billion) of the sector has had problems, ARS were already reeling from an accounting decision to classify them as non-cash holdings. Today's Wall Street Journal article "Credit Woes Hit in Unlikley Places" says, "Bristol-Myers, which has traded auction-rate securities for nine years, is hardly alone. CFO Andrew Bonfield says his auditors, Deloitte & Touche, tell him they have around 70 clients who are dealing with issues like this." Other companies, like 3M and USAir, have taken smaller, similar charges. The demise of ARS is one reason for recent massive inflows into money market funds." (Note: Money market funds never invested in auction-rate securities; these were sold as higher-yielding money fund alternatives.) We also wrote a little over 10 years ago, in mid January 2008, the news brief, "Tax Exempt Money Funds Sheltered From Ambac, MBIA Downgrades," which discussed another chapter of the 2007-8 crisis -- the collapse of the municipal bond insurers. It said, "Concerns have escalated in the municipal bond market over the possible downgrade of bond insurers Ambac and MBIA, which, until recently insured as much as half of all municipal debt issuance."

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