Credit market jitters began in February, when one of the largest subprime lenders, New Century Financial (other-otc: NEWC - news - people ), collapsed.
The subprime meltdown, which began about this time last year with the bankruptcy of New Century Financial (other-otc: NEWC - news - people ), has spread throughout the credit markets and has dragged down banks and bond insurers along with it.
So far, the damage in the U.S. mortgage industry has been confined to a few highly leveraged and weakened lenders, such as New Century Financial (other-otc: NEWC - news - people ), which had to file for bankruptcy earlier this year after its banks refused to extend it more credit, and to a few funds that had big investments in the sector.