Australia's Stevens warns on CDOs

Glenn Stevens, the governor of the Reserve Bank of Australia, has warned that the country's local government bodies may have invested in collateralised debt obligations (CDOs) without understanding their risks.

The Australian's Daily Telegraph, a newspaper, quoted Stevens as saying: "The real question is whether some bits of risk are being given to people who are unaware of what they're doing."

He added that local authorities were attracted to these instruments because of the higher yield they

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