The critical faultline in the selloff has been the sudden strength of the greenback, as banks and investors liquidate assets and scramble for cash.
The Fed’s pledge last week to buy investment-grade credit and certain ETFs helped halt the slide in mutual fund net-asset values and sparked a rally in higher-rated debt.
The prevailing feature of the recent turbulence is that nothing has really worked as it was supposed to work.
The Fed’s efforts have restored calm in some areas, but risky credit remains vulnerable.