[lbo-talk] Capitalism on Derivatives? (Was: Responsibilities)

[Mike Beggs]

On Mon, Mar 1, 2010 at 12:47 AM, Ted Winslow <egwinslow at rogers.com> wrote:
> Mike Beggs wrote:
>
>> Actually, though, it was only a small proportion of the underlying
>> mortgages that were defaulting (though larger than the norm).
>
> http://en.wikipedia.org/w/index.php?title=Subprime_mortgage_crisis&printable=yes
>
>> The value of USA subprime mortgages was estimated at $1.3 trillion as of March 2007, [17] with over 7.5 million first-lien subprime mortgages outstanding.[18] Between 2004-2006 the share of subprime mortgages relative to total originations ranged from 18%-21%, versus less than 10% in 2001-2003 and during 2007.[19][20] In the third quarter of 2007, subprime ARMs making up only 6.8% of USA mortgages outstanding also accounted for 43% of the foreclosures which began during that quarter.[21] By October 2007, approximately 16% of subprime adjustable rate mortgages (ARM) were either 90-days delinquent or the lender had begunforeclosure proceedings, roughly triple the rate of 2005.[22] By January 2008, the delinquency rate had risen to 21%[23] and by May 2008 it was 25%.[24]

Hey thanks for tracking down the data to back up my point, Ted!

Mike