Talk:Sub-prime lenders send jitters through global markets

Notes on final paragraph

The final paragraph:

Sub-prime lenders provide mortgages to people with less-than-stellar credit histories. The lenders then bundle these mortgages as collateral for loans that they obtain from other financing firms, such as GMAC. Such firms can then repackage these loans and sell them as mortgage-backed securities. These securities may end up in the hands of major multi-national banks such as Citibank, HSBC, and Commerzbank. Each level of lending assumes a level of financial risk, but trouble can arise when the risk tolerances are exceeded. If too many homeowners default on their mortgages, the sub-prime lender can end up defaulting. If too many of these lenders default, as it is feared may be happening now, the defaults can cascade upward. While no one is predicting major bank failures at this point, it is feared that their profits could be hurt.

While a lot of the information in this paragraph can be gleaned from the sources for the article, it contains additional information and rationale not necessarily found in the sources. I relied on my own business education and experience in the financial industry to write a paragraph that, I hope, explains in relative layman's terms what is important about these sub-prime lenders and how they can affect global financial markets. Even I, could not have named any of these sub-prime lenders until a few weeks ago. I had hoped that Wikipedia would have had a good article on the subject that I could have cited. However, both w:Subprime and w:Sub-prime lending leave a lot to be desired. --SVTCobra 23:35, 13 March 2007 (UTC)

I see that Wikipedia has now merged the two articles and the result is a somewhat better article that may be useful. --SVTCobra 22:24, 14 March 2007 (UTC)

Vandalism

This article was the victim of vandalism that went uncorrected from August 20, 2007, until September 17. Hopefully, it will be archieved soon. --SVTCobra 23:44, 17 September 2007 (UTC)