What happens when the global bond markets decide to shut down for a protracted period?
Banks and financial organizations still hold their assets, though nobody wants to buy them or even trade for something else. This leaves the organization with a valueless asset, until the market can bear it again.
With all of these assets supporting capital requirements, revaluating them has some important implications. Banks are required to hold a certain amount of capital according to Basel regulations, and if this doesn't happen, liquidations occur.
But what if there is still no market for the liquidated assets?
Managers and execs will probably decide to go on holidays for awhile...
Glance at the more or less healthy stock markets in New York, London, and Frankfurt, and you might never know that this debate is raging. Hopes that Middle Eastern and Asian wealth funds will plug every hole lifts spirits.
Glance at the debt markets and you hear a different tale. Not a single junk bond has been issued in Europe since August. Every attempt failed.
Europe's corporate bond issuance fell 66pc in the third quarter to $396bn (BIS data). Emerging market bonds plummeted 75pc.
"The kind of upheaval observed in the international money markets over the past few months has never been witnessed in history," says Thomas Jordan, a Swiss central bank governor.
Another scary graph... the music stopped in August and it has been eerily silent ever since.