One of the benefits of the mortgage meltdown is that its fallout is making us aware of parts of the financial markets that usually remain hidden from view. This comes to mind in reading a New York Times [registration required] report that a British money management firm, Cheyne Finance, may liquidate the assets backing its $10 billion Commercial Paper (CP) program.

Cheyne is a Structured Investment Vehicle (SIV) -- one of 30 in the $2.2 trillion CP market that borrow money using CP - and then invest the money in longer-term securities with slightly higher yields. The SIV. then pockets the difference, bolstering the asset management company's overall return.

The problem with Cheyne is that 25% of its CP is backed by pools of home equity loans. And in the last two weeks, McGraw Hill Companies' (NYSE: MHP) S&P downgraded Cheyne's CP by six notches. I don't know what's changed so suddenly but if your money market fund is invested in Cheyne's CP, you could have a problem.

With Asian markets taking a sympathy plunge this morning -- "Everyone is scared. It's like walking in the dark because we have yet to get the full picture of the subprime loan problems" -- do you think Fed Chair Ben Bernanke and Treasury Secretary Hank Paulson were right to say the subprime mortgage crisis is contained?

Peter Cohan is President of Peter S. Cohan & Associates, a management consulting and venture capital firm. He also teaches management at Babson College and edits The Cohan Letter.