Even as the sub-prime melt down became apparent a few weeks ago many articles downplayed it. Articles on Yahoo Finance pointed out that the default rate is still low and is backed by homes that have value. What they failed to reveal is that many of the loans were bought by investors on credit with 5% or less as collateral. Meaning most investors have lost 100%. Here is a humorous video summing up the problem from an article by Gary Tanashian about investing in gold.
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