Leveraged Money Spurs Selloff as Record Treasuries Trade

When markets are buckling and volatility is signaling a crisis, you sell what you can, not what you want.

That’s what happened last week on Wall Street, where slowing economic growth in Europe, Ebola anxiety and escalating conflicts in the Middle East and Ukraine tore through the calm with a force not seen in three years. Loath to find out what their record holdings of corporate bonds and leveraged loans were worth as liquidity thinned and markets slid, professional traders turned to stocks and Treasuries to defuse risk.