Actual Conversation from last week: Investor, to his stock broker: "Do I have anything in my portfolio with exposure to the sub-prime mortgage market?" Broker: [laughing] From the Wall Street Journal, 3/15/07: "People lack the tools to quantify the exposure of the financial system to subprime, and where there is uncertainty, you sell first." -- Teun Draaisma , co-head of European equity strategy at Morgan Stanley The Point: Everybody who has anything invested in the stock market is directly or indirectly exposed to the sub-prime mortgage market, and as the sub-prime bubble goes, so will go the market. Sub-prime mortgages are loans made to borrowers with sketchy or outright bad credit, usually taken out to buy houses or refinance existing loans. These types of loans sometimes have higher-than normal interest rates, but also include loans with certain features that allow borrowers to pay abnormally low interest rates--or no interest at all--for a certain peri
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