Alt-A: next to wobble?

By Jim Leaviss

Bloomberg’s Mark Gilbert has written an interesting piece (read here) about the recent turbulence in credit markets. In particular it’s worth noting Moody’s comment that the next level of loans up in quality from sub-prime, the "Alt-A" mortgages, look to be showing the same level of distress as the supposedly weaker loans. Loose lending standards, and falling house prices are a toxic mix for US mortgage backed credit.

The value of investments will fluctuate, which will cause prices to fall as well as rise and you may not get back the original amount you invested. Past performance is not a guide to future performance.

Jim Leaviss

Job Title: CIO Public Fixed Income

Specialist Subjects: Macro economics and fixed interest asset allocation

Likes: Cycling, factory records, dim sum

Heroes: Brian Clough, Morrissey, Neil Armstrong

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