The Banking Fiasco

A bear, this morning, mentioned:
The S&L was a liquidity problem, and
that this is a Credit problem.

Funny, maybe he said the opposite.

I'm interested in looking at the difference, I mean, doesn't a liquidity problem with the ABP(asset backed paper) become a credit problem?

Also, The current L3(non liquid, mark to myth) assets have to become L1(mark to market) assets on the 15th of November? or can they become L2(mark to model)?

or is it that they just have to be liquid?

The idea that Goldman has the highest percentage of L3 assets has me laughing, Maybe they get stuck without a chair?

Update: It looks to me like the fasb 157 will affect things in the 4q. I'm not sure about it affecting anything more before the 15th of november.

I did mention that some of the people holding them will have to sell them into the market when they go below AAA assets.