Comments on: Subprime Credit, Illiquidity, Leverage, Contagion and Concentration http://alephblog.com/2007/06/30/subprime-credit-illiquidity-leverage-contagion-and-concentration/ Helping Institutions and Ordinary People Invest Better by Focusing on Risk Control Mon, 13 Feb 2012 17:14:22 +0000 hourly 1 http://wordpress.org/?v=3.3.1 By: James Daileyhttp://alephblog.com/2007/06/30/subprime-credit-illiquidity-leverage-contagion-and-concentration/comment-page-1/#comment-1529 James Dailey Mon, 02 Jul 2007 03:52:08 +0000 http://alephblog.com/?p=159#comment-1529 Hello David, I respect your opinions on these topics immensely and have had no personal experience in the MBS market. I do trade futures at high leverage personally, so I do have a good sense of risk in that regard. Why are you sanguine that the holders of these toxic CDOs are not leveraged with large exposure in other markets? I subscribe to the complexity/chaos school of market price determination, and I believe it is tough to argue that we are at a critical state due to the massive systemic leverage across asset classes. Of course, that has been the case for quite a while. Who knows what will happen, but once a critical state is reached relatively "small" developments can have a cascading effect. Hello David,

I respect your opinions on these topics immensely and have had no personal experience in the MBS market. I do trade futures at high leverage personally, so I do have a good sense of risk in that regard. Why are you sanguine that the holders of these toxic CDOs are not leveraged with large exposure in other markets? I subscribe to the complexity/chaos school of market price determination, and I believe it is tough to argue that we are at a critical state due to the massive systemic leverage across asset classes. Of course, that has been the case for quite a while. Who knows what will happen, but once a critical state is reached relatively “small” developments can have a cascading effect.

]]> By: Mitch Powitzhttp://alephblog.com/2007/06/30/subprime-credit-illiquidity-leverage-contagion-and-concentration/comment-page-1/#comment-1519 Mitch Powitz Sun, 01 Jul 2007 13:11:50 +0000 http://alephblog.com/?p=159#comment-1519 David, Hi. Big fan of your writings from Real Money - and now this blog. Question - You spell out this subprime issue nicely here (coming from someone with no experience in bonds), but my question to you is - from your vantage point, how does this affect equities? Thanks. Mitch Powitz Long Beach Island/Toms River, NJ David,

Hi. Big fan of your writings from Real Money – and now this blog.

Question – You spell out this subprime issue nicely here (coming from someone with no experience in bonds), but my question to you is – from your vantage point, how does this affect equities? Thanks.

Mitch Powitz
Long Beach Island/Toms River, NJ

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