Capacity of crisis so far unquantified

Investors need to buy sovereign bonds or invest in funds that can short corporate debt if they want ...

Investors need to buy sovereign bonds or invest in funds that can short corporate debt if they want to make money over the next 12 months. Richard Hodges, manager of Legal & General's Dynamic Bond Trust, believes no one has yet quantified the size of the sub-prime crisis and many financial institutions are yet to bite the bullet and put realistic valuations on their loses. He argued no one knows what the situation facing financials is, leading to large volatility in bond and share prices. He said banks should be pricing many of their assets affected by sub-prime as worthless and not u...