To quote from the article, "To understand the mind-boggling enormity of this mess, it's instructive to picture how we got here. Focusing on subprime mortgages or mortgage-backed securities ignores the dense network of links and connections that form an opaque system of derivatives and debt. Any number of other high-yielding asset classes could have started the crisis, says Paul Mizen, an economics professor and director of the Centre for Finance and Credit Markets at the University of Nottingham School of Economics. It so happened that the subprime market soured first."
In a previous post (September 26, 2008), I mentioned that the Alt. A mortgages, subprime mortgages, and mortgage-backed securities are just the "tip-of-the-iceberg." In that post, I stated that the mortgage market has an approximate value of $7 trillion, but the CDS has an approximate value of $58 trillion. And, therein lies the problem to this financial debacle of major proportion that one only observes once in a generation. Life, as you have known it, has been changed forever.
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