Calpers executive say subprime crisis likey to impact economy

“U.S. financial markets are likely to experience some fall-out from the subprime mortgage lending woes but they are likely to be limited, the chief investment officer at the biggest U.S. pension told Reuters on Monday. The subprime sector ‘is an important weakness in the economy and it is likely that there will be a measured impact in other sectors. And there is likely to be some contagion,” said Russell Read of Calpers, which invests about $232 billion for California state workers… Some of the other sectors that could be impacted were the high-yield bond markets where defaults are likely to creep up, Read said in an interview on the sidelines of a Council of Institutional Investors meeting. He added, ‘we are concerned but not worried.’…Calpers has little direct exposure to the subprime sector, Read said.”