...breaking on CNBC.
Will update with a link when I find it.
Will update with a link when I find it.
You are using an out of date browser. It may not display this or other websites correctly.
You should upgrade or use an alternative browser.
You should upgrade or use an alternative browser.
Newest Estimate: Subprime Woes May 'Wipe Out' 30% to 50% of Home Sales in 2007/2008
- Thread starter ByLoSellHi
- Start date
Its at least 20%, even if it affects nobody else.
The foreclosures will start hitting big time this summer. That will drop home prices another 5%+.
Common sense suggests this will drag an already slowing economy into recession.
If some other cycles come together at same time it could get super ugly. Great depression II seems plausible.
China could have a big hiccup. If we go into recession they could go from growing +10% to minus 5%+ real fast. China hasn't seen a recession in how many years?
Will be an interesting Summer.
Common sense suggests this will drag an already slowing economy into recession.
If some other cycles come together at same time it could get super ugly. Great depression II seems plausible.
China could have a big hiccup. If we go into recession they could go from growing +10% to minus 5%+ real fast. China hasn't seen a recession in how many years?
Will be an interesting Summer.
Until the next phase when subprime mortgage-backed bonds are downgraded, the smart vultures have a quick feast:
Who's Profiting from the Subprime Bust
As the market in shaky mortgages collapsed, some hedge funds raked in profits by betting on a decline in the ABX subprime index
March 8, 2007, 6:06PM EST
by Matthew Goldstein
There has been a lot of pain in the market for mortgages to people with shaky credit histories. Small, so-called subprime lenders are filing for bankruptcy. Shares of big lenders New Century Financial (NEW), NovaStar Financial (NFI), and Fremont General (FMT) are getting crushed, as concerns about rising customer defaults mount. But through all the misery, some savvy hedge funds are posting big gains.
How's that? The hedge funds raking in fat profits from the meltdown in the subprime market have cleaned up by betting on a decline in the ABX subprime index, which measures the cost of insuring against defaults on subprime bonds. The index, created by London-based Markit Group, tracks 20 asset-backed bonds with a low investment grade credit rating. Beginning last fall a number of hedge funds began shorting the indexâbetting on a declineâeither as a way to minimize their exposure to subprime bonds in their portfolios, or simply to profit from an anticipated sector rout. The ABX short bet came up a big winner when the index plunged in February, leading to a 34% decline for the year...
http://www.businessweek.com/print/investor/content/mar2007/pi20070308_900631.htm
Who's Profiting from the Subprime Bust
As the market in shaky mortgages collapsed, some hedge funds raked in profits by betting on a decline in the ABX subprime index
March 8, 2007, 6:06PM EST
by Matthew Goldstein
There has been a lot of pain in the market for mortgages to people with shaky credit histories. Small, so-called subprime lenders are filing for bankruptcy. Shares of big lenders New Century Financial (NEW), NovaStar Financial (NFI), and Fremont General (FMT) are getting crushed, as concerns about rising customer defaults mount. But through all the misery, some savvy hedge funds are posting big gains.
How's that? The hedge funds raking in fat profits from the meltdown in the subprime market have cleaned up by betting on a decline in the ABX subprime index, which measures the cost of insuring against defaults on subprime bonds. The index, created by London-based Markit Group, tracks 20 asset-backed bonds with a low investment grade credit rating. Beginning last fall a number of hedge funds began shorting the indexâbetting on a declineâeither as a way to minimize their exposure to subprime bonds in their portfolios, or simply to profit from an anticipated sector rout. The ABX short bet came up a big winner when the index plunged in February, leading to a 34% decline for the year...
http://www.businessweek.com/print/investor/content/mar2007/pi20070308_900631.htm