Mortgage brokers and investment advisers have reason to be on their guard for their clients.
There is less confidence across a range of asset classes than just a few weeks ago. In a set of developments which sees sub-prime as the villain of the piece, it is actually not brokers that have the most to worry about.
Two small lenders, Infinity and Unity Home Loans, and one bigger one, DB Mortgages, have withdrawn products from the market to reprice.
For brokers, this means the cost of sub-prime borrowing may rise for clients. Perhaps some smaller lenders may choose to exit indefinitely. The frustration is that because of what might be described as reckless lending in the US, the market in the UK may tighten and become less competitive than it would have, even given rising interest rates.
This has been aggravated by a global fund industry which has invested in geared contracts and instruments which ultimately have been based on less than safe lending.
But most mortgage brokers have probably not seen detriment to clients and unless there is a real drying up of sub-prime availability and a knock-on effect on market confidence, there is no need to panic.
The fortunes of brokers and clients are linked to house prices. A slowdown would be a much greater problem. But brokers would be wise to keep one eye on how the market for lenders develops for the long term. They should consider their business models in the light of the fact that mortgages are being supplied at very tight margins and may not be sustainable.
On the investment side, advisers must be disappointed to see some retail funds affected by investments which fund managers may not have fully understood. It makes a strong case for advisers finding fund managers who can demonstrate the skills for managing new types of assets rather than bandwagon-jumpers who understand return but maybe do not understand risk.