Commercial Paper

As today's Financial Times reports, more and more companies are being frozen out of the commercial paper market, the main source of day-to-day corporate funding. Not surprisingly, a number of the companies being frozen out are from the telecommuncations sector. They include Qwest, Sprint and a number of others to be named sooner rather than later.

Last year, I wrote a column about the woes of telecom that dealt, in part, with the sector's staggering debt loads. Those debt loads are getting a much harder look in the wake of the Enron/Global Crossing debacles. When a company like Qwest (which is not just a fiber-optic network but an RBOC as well) gets tossed out onto the street by the commercial paper market, then the game really has changed.