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WHEN the American housing market turned, subprime borrowers started defaulting.
The collapse of the group became inevitable after it started defaulting on payments to investors in January.
The news that Venezuela has started defaulting on its debts raises an important question: Can the current regime survive the likely economic fallout?
Then subprime mortgages started defaulting at alarming rates, igniting panic in the markets and a sell-off among some of the largest hedge funds in the industry, including Tudor, Caxton and Goldman Sachs.
As the downturn took hold, some borrowers started defaulting on loans and investors stopped buying the securities, forcing Harley to write down $80 million of debt last year, analysts said.
The situation of "extreme difficulty" described this week by the prime minister, Mariano Rajoy, has at its root the flats that the banks accumulated when people started defaulting on their mortgages.
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He needed only the most vulnerable of all homeowners to start defaulting.
Irish lenders also face concerns about whether mortgage holders will start defaulting in large numbers.
If authorities push rates up too quickly, South Korea's indebted households could start defaulting.
They said Toyota and other carmakers could face losses if American consumers start defaulting on auto loans.
Overstretched borrowers were bound to start defaulting in large numbers once the housing bubble burst and unemployment began to rise.
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Justyna Jupowicz-Kozak
CEO of Professional Science Editing for Scientists @ prosciediting.com