December 18 2008 17:15 Halting the tidal wave of deleveraging that has swept through the markets is paramount if policy moves to restore the financial system are to work, says Jonathan Wilmot, chief global strategist at Credit Suisse, as part of a report on the outlook for 2009. âSince Lehman Brothersâ demise on the altar of moral hazard, deleveraging has become an overwhelming forceâ, he says. âTrillions of dollars of asset value have been destroyed, freezing credit markets as usable collateral and counterparty confidence evaporates, and sparking a near vertical drop in orders, production and confidence.â Mr Wilmot says that were this a standard panic, he would be very bullish on both equities and credit. âValuations range from attractive to compelling. Buying cheap assets in a panic is what value investing is all about.â But the current crisis has all the hallmarks of an âextreme eventâ that could end up transforming the whole political, economic and financial landscape for decades to come, he says. âWe believe 2009 will be a contest between the massive destructive power of systemic deleveraging and massive government action to nudge the credit system towards a healing equilibrium. Policy should win the next round, but ultimately we are more bullish than that. There is still time to convert an incipient depression into something like a classic 19th century panic, thus giving the world a chance to achieve full potential in the coming decade.â http://www.ft.com/cms/s/0/0c1b0822-cd20-11dd-9905-000077b07658.html?nclick_check=1