The Subprime Directive

For all the talk of the minimal effect the sub prime defaults are going to have, it's pretty apparent that the "minimal effects" are going to be larger than anyone has expected. Let's just look at the current closings and layoffs

• Loancity closed on 3/22/07
  
• Countrywide's subprime mortage defaults for 2006 may exceed the company's highest on record.
  
• New Century lays off 54% of their workers (this company is headed for the dustbin)and files for Chapter 11
  
• Aegis Lending plans to shutter its Sacramento office
  
• People's Choice (another sub prime lender) files for chapter 11
  

The shake out in California continues. You can bet that you will hear about it hear first (or nearly first). New Century was one of the ones that we reported on very early on (when I got a few emails about the situation there).