Pursuits
Subprime Gains 30% as Goldman, Cerberus Target Market
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U.S. home-loan securities without government backing, the debt that sparked the worst financial crisis since the Great Depression, shrank last quarter to less than $1 trillion for the first time in eight years, leaving fewer bonds to meet soaring demand as housing recovers.
The non-agency mortgage bond market has contracted from $2.3 trillion in mid-2007 when a property bubble fueled by shoddy loans burst, according to Federal Reserve data. It’s fallen to about $970 billion after record homeowner defaults, borrower refinancing and limited sales of new debt.