Pimco mortgage crisis throws cold water on United States secondary will spread

According to the finance Board, Pimco. views the former Fed Chairman Alan Greenspan. Greenspan said in last week's sub-prime mortgage loan default rate will spread to other parts of the economy, especially once the price decrease of "we think we are in the doldrums of the medium-term, not the end.　　"The world's largest bond fund Pacific investment management company (Pimco) last Friday to write to the customer's address, mercilessly to present in a mess of United States subprime mortgage problem and then throwing a pot of cold water on the". " Nearly two years ago, Pimco fund managers is almost the first foresaw the weakening of the United States House price, and for the moment the secondary mortgage market crisis experienced by the bold prediction that again, Pimco, apart from the subprime mortgage market, "Alt-A" and large-value mortgages (jumbo mortgage) of the borrower's default rate may also be increased.　　Subprime mortgage problems will spread to other mortgage market. The so-called "Alt-A" refers to those borrowers with good credit record, but otherwise does not comply with the highest credit rating (A) loans, so they get the loan interest rate of interest than A level slightly higher. While large mortgage loan amount is more than 41.7 million mortgage.　　Current United States mortgage market, loans worth 1.14 trillion Alt-A, representing 12% of the total market; large-value mortgages worth 1.41 trillion, representing total 14.8% market; secondary mortgage loans worth 1.45 billion, accounting for 15.2% of the total market. "The subprime mortgage market, may spread to those most likely to be approved for the loan class, such as Alt-A or large amounts of high-quality loan market. "Pimco wrote in the report.　　But the Pimco on high quality mortgage market remains relatively optimistic attitude, and do not think it would be too much of an impact.　　In July 2005, the Pimco think higher interest rates will make the real estate market slows, the company's Chief Investment Officer Bill Gross in 11 months ago said, no longer fear price increases, people will eventually stop the purchase of real estate.　　United States Mortgage Bankers Association (Mortgage Bankers Associatioin) announced last week, last year's fourth quarter United States subprime mortgage loans past due rate rises to 4-year high, and all types of housing loan loss ratio of collateral of redemption has grown to the highest in history. Pimco's view with the former Fed Chairman Alan Greenspan. Greenspan said in last week's sub-prime mortgage loan default rate will spread to other parts of the economy. In particular, once the price decrease.　　House prices fell by Pimco prediction will reduce United States gross domestic product (GDP) growth rate reduction of 1%.　Pimco's analyst Scott Simon that went to the United States since late collapse of sub-prime mortgages have exceeded the 30 's. Pimco expected this year, the United States House of intermediate values will drop to 4% to 5%.　　United States National Association of real estate brokers (National Association of Realtors) data show that in January this year than last year xianfang intermediate 7-month maximum period declined 8.5%. "Due to slower growth in the consumption of the multiplier effect, on the economic impact it may have more. "Pimco often United States real estate compared to a very large oil tanker," in place of call 23 miles completely turned too tall.　　"Pimco in analysis reports that the impact of various issues, consumer finance had tight. According to Harvard University's Joint Center for real estate research, real estate and from copper producers to kitchen furniture, and other real estate related industries account for about 23% of the United States economy. Merrill results showed that until last year United States housing prices have experienced a rise in five years, and the contribution of the United States in 2001, half of economic growth.