Ripple Effect of Subprime Mortgage Loans

The ripple effect of subprime mortgage loans has a long way to spread with greater troubles to follow. The fact that “vulture” investors are still for the most part staying away from the troubled mortgage loans is a sign that they have further to fall according to CCN News.

The fact is no one wants to touch these loans now and there is little to no liquidity in the sub prime housing mortgage market. Even worse the ripple effect is effecting credit and credit ratings right across the board.  Huge losses are being reported by market participants, like Merrill Lynch, that has reported losses of almost $8 billion of mortgage and related assets.

$8 billion is one hell of a loss to absorb, even for a financial industry giant like Merrill Lynch. The big question now that overhangs the mortgage loan market is how many more Merrill like situations are there still unreported?

Meanwhile, the vultures wait while the ripples spread through the financial world.

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