MARKET

READING

The real concern for the global economy in 2008 will continue to be fallout from the U.S. mortgage crisis. For many countries, the current corrections in real-estate market are a normal feature of the business cycle. but the present U.S. situation is different in a way that accentuates the short-term risks as well as the long-term recovery prospects.

In the past, morgage lenders took deposits from customers and lent the money to home buyers. Nowadays, and more in the United States than elsewhere, mortgage lenders and other financial institutions higher up the value chain often take bundles of mortgage loans, repackage them and sell them as tradable securities to investors.