Now the suckers are gone, out of business. Right now there is a shortage of paper. Brothers, at Cavalry, says the buyers surviving the marketplace turmoil knew if they had to chase product at CFS prices, they would fail. Buyers now tend to bid within mere fractions of one another, he says. The market is becoming more stable as a result.
Observers point to several signs creating a healthier market.
Midland Credit recovered from its liquidity problems after acquiring debt buyer West Capital Financial Services in May 2000 in exchange for 375,000 stock shares. Midland, now in San Diego, also bought certain distressed consumer assets from West Capital for 25,000 shares of common stock. Midland's turnaround is a microcosm of the market's recovery. NCO declined comment. Observers say NCO's move to add asset acquisitions to its arsenal gives the company another channel to acquire inventory for recovery.