This is a bull case for the equity in a subprime lender formerly owned by AIG. The author contends that the company may be in for a bright future due a confluence of factors that would have seemed unlikely just a few months ago, including the return of the asset-backed securities (ABS) market and the credit quality of subprime borrowers. As you read, imagine how you would have reacted to these same words written just a few years ago.
Among the more remarkable comebacks in financial history is the recent resuscitation of the global asset-backed securities market that was pronounced dead after the 2007–09 global financial crisis. Earlier this week, we asked readers whether they thought the revival was a positive or negative development for financial markets.
Europeans did and do dominate the world of covered bonds, but US investors are showing an increasing interest in these instruments.
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