Wall St. starts to reckon with subprime

The collapse of the subprime lending industry is starting to impact Wall Street as investment funds that bought a stake in subprime loan businesses start to post losses. Hedge funds and pension funds that invested in faltering subprime businesses are expected to start acknowledging heavy losses tied to subprime investments over the next year and a half, which will likely mean that less financing is available to consumers with weak credit. That, in turn, could prolong the current nationwide housing slump. more [NYT]