Distressed debt investor TCW Group and hedge-fund firm Marathon Asset Management have begun looking at buying assets in the mortgage market. But, they have not moved in yet, as far as anyone can tell. But, as CNN Money points out "the feeding has not yet begun in earnest – and that’s not a good sign for the housing and credit markets."
That means that the smart money, or a big piece of it, thinks mortgages and mortgage-backed financial instruments have further to fall. That, in turn means that some of these pools of capital carried on the balance sheet of companies like Merrill Lynch (MER) and Countrywide (CFC) may not have been written down far enough.
Douglas A. McIntyre