ABC Online- An influential global economist has warned the widening financial crisis could plunge the world into recession, as an Australian company becomes the latest victim of the market turmoil.
The Sydney-based hedge fund Basis Yield Alpha, run by entrepreneurs Stephen Howell and Stuart Fowler, has filed a petition for bankruptcy protection in New York.
Its parent company Basis Capital has asked the US courts to bar legal action against the fund while it liquidates assets – news that is likely to send a chill through financial markets.
The suit, filed overnight in the US Bankruptcy Court, is essentially a plea that investors and creditors not be in a position to sue Basis Yield Alpha whilst it winds up and liquidates assets held in the Cayman Islands.
The hedge fund’s fate demonstrates the six degrees of separation that now exists in financial markets.
