In view of the turmoil in the credit markets, securitization of productive assets is perhaps the only realistic financing proposition. A few guidelines are in order here.

The chaos today on Wall Street bears no resemblance to earlier meltdowns, primarily because it comes at a time when the five-decade-old process of global capital accumulation has stalled, and because risk insurance coverage providers, who remained pillars of that process, are now finding out that their risk assessment methodologies were premised more on optimism than verifiable substance.

The recent crisis in the debt market has had a direct and adverse bearing on portfolio valuations. But all is not lost; asset managers need not liquidate bonds and debentures, or shares for that matter, at a loss. Asset swaps now offer a compelling method to exchange risk profiles. The chaos in pricing offers unique opportunities to trade risk, and to exit negative holdings in a non-traditional manner.

Equity and debt prices for internationally listed companies mining in large parts of Latin America have deteriorated sharply in recent weeks in the face of changes in government policies. What does the future hold for those invested in South American mining?