I’m not sure that in one post you can say that I’m at risk for hitting all 10 lights (meaning that there is risk in some degree for every potential outcome) and then in another post say that not all mortgage loans are “at risk”.

sdrebear, touche. That does appear to be contradictory. I would agree with you if the liklihood of all of the outstanding mortgages had an equal liklihood of defaulting. I have no way of distinguishing between one street light over another. Thus they are all “at risk.” The difference is randomness. Street lights are random, liklihood of mortgage defaults are not.

The problem is that the original author did not define “at risk.” If he had said that an at risk mortgage is over a certain LTV or is scheduled to adjust to a payment that is above a certain percentage of gross household income, then it would be more clear. Out of the total set of outstanding mortgages, any of them can default, but we know that a certain subset defined by parameters such as I named are at higher risk for default.

I agree about the slippery language analysts use to qualify everything they say. I think he could have been more clear by defining “at risk” as I mentioned, and by explaining that a certain percentage of those “at risk” mortgages are expected to default.

An “at risk” high school student may be defined as one who is failing a certain number of classes, has over X number of tardys and absences, and has had disciplinary issues. Some of these kids will not succeed. They will drop out and perhaps get into legal trouble. I certainly do not expect all of them to. Likewise, a student who gets good grades and has not had any problems CAN drop out and get in trouble with the law, but we would not have described this child as “at risk” before that time.