Subprime worries grow with Bear Stearns news

Fannie Mae projects 10.2% decline in '07 home sales

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Two Bear Stearns hedge funds that invested in securities backed by subprime mortgages have very little or no value, the company told investors in a letter Tuesday.

The news, coupled with last week’s decisions by ratings agencies to downgrade their ratings on billions of securities backed by subprime loans, could force other securities firms to write down the value of such investments.