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The subprime illustration.

The subprime market is mainly comprised of risky loans granted to customers with limited creditworthiness or credit history difficult. This market has largely developed in the United States since 2001. It is clear that for these U.S. mortgages, the fundamentals in debt have not been met. These credits were not on a proven track record of repayment for borrowers but a potential revaluation of the underlying assets and this, with credits arranged for the minimum repayments are the first two years and then generally indexed to variable rates. The impossibility of resale with gain after two years (real estate prices began to fall in several regions of the United States from 2006), and inability to cope with repayments (Reserve Federal has gradually raised its rate by 1% to 5.25% between 2004 and 2006) have made these subprime assets ("distressed assets").

Prime fundamental not respected: the repayment capacity of borrower to be assessed over time . At this stage it should be noted that the practice of French banks is obviously not this one.

The attraction of the potential yield of these funds who received a risk premium, has resale in the global financial community in search of ever greater efficiency and cost savings to its customers. The subprime has been heavily sold in markets in securitized form (the claims are grouped into vehicles to make ad hoc and converted into marketable securities subscribed by investors) is, once the crisis is triggered, all forms of credit securitization vehicles that have become suspect in the eyes of investors lest they carry credit risk in general and subprime in particular. Sales, resales and financial engineering have forgotten the origins.

Second fundamental not respected: to control the risk it is better to know the origins seamlessly. research performance by the complex mechanisms of financial markets in a purely speculative here very directly affects its limits.

Stock Markets Are they still attractive for companies that develop policies and strategies over time? Before the fluctuations of stock markets, which may be independent of the values of listed companies and their potential dividends, and strategies to more speculative investors courtermistes we doubt it. How to encourage the individual to go and invest on "gazelles" (cf. John Paul Betbèze) that create value and jobs in our regions, whether to remain stuck in a narrow walk and be in a thank you crisis Independent Fundamental company.

A stock market investment should be sustainable (3-5 years minimum). Any shorter investment horizon greatly increases the risk taken. Another fundamental that we forget.

Moreover, any investment in scholarship must enroll in a real estate strategy (balance in the diversity of investments) with clearly defined management objectives (speculation or performance over time). have a strategy for its heritage, another fundamental respect.

is in compliance with these fundamentals that I see the usefulness equity markets: a meeting of companies that have optimal financing needs and actors who hold financial capabilities.

Today with real-time access to markets, with live information, with the considerable lowering of price levels of scholarship, yet the temptation is great for the individual to have an attitude a bit speculative.

A question was asked by Pauget in the gallery of 19 November: "The new accounting standards they are a factor in accelerating the financial crisis?" We discover the limits of the "mark to market ", where the market value does not account for the time scale or the economy, or the actors. Added to the phenomenon of speculative bubbles (which are otherwise sound), the" mark to market "may be the cause of the disconnect between the stock and the actual value of the company under its management objectives.

And before the question asked: probably be he explore all media that allow equity investments sustained over time and not subject to excessive swings in stock markets ? We investment funds proximity for those who love regional businesses. And the shares for those who like cooperatives.