Last week I highlighted the excellent piece by Paul McCully of Pimco. His thesis is that subprime buyers are the plankton of the housing ocean.

I don’t know if I agree with the sub-prime plankton idea. What I do know, is that PIMCO is exposed to dollar devaluation (most of their foreign funds are dollar hedged, so they do not benefit from dollar decline), and has a large securitized mortgage holdings. I think there may be a bit of a slant on this one. (I’ll see if I can get some time to read these through).