Daniel Castro, the former head of structured finance research at Merrill Lynch, thinks some mortgage securities are such a screaming deal that he's setting up a hedge fund, Huxley Capital Management, to buy them.

FORBES: Yes, there is a market for toxic mortgages.

And confidence in credit-card asset-backed securities is pretty firm despite paralysis in other corners of structured finance.

ECONOMIST: Consumer credit

The secret, she said, lay in her patented structured finance vehicles, composed of distressed debt of "broken companies" that she repackaged as investment-grade securities.

FORBES: On The Cover/Top Stories

But some of the buyers of those securities (hedge funds, conduits and structured investment vehicles) were ultimately dependent on the banks for finance.

ECONOMIST: Buttonwood