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According to the WSJ’s „Tracking the Numbers” column, Wall St. thrives on risk, so what better investment these days than the subprime-mortgage business. Lenders that make home loans to buyers with troubled credit history sprinted ahead during the housing boom, only to see prospects wane as interest rates rose, home prices fell and borrowers had trouble making payments. With losses mounting and consolidation sweeping the industry, Wall Street, not the banking industry, is emerging as the consolidator. In the past 3 months, Morgan Stanley (MS) agreed to buy Saxon Capital for $706m. Merrill Lynch (MER) struck a $1.3bn deal to buy National City's First Franklin lending unit, and Bear Sterns (BSC) is buying the mortgage unit of ECC Capital for $26m. H&R Block (HRB) recently disclosed it might sell its Option One lending unit, which last year made about $40bn in loans. "Clearly the broker-dealers are leading the charge," says Matthew Howlett of Fox-Pitt Kelton.

According to the “Heard on the Street” column, bad news may be in store for Western telecom-equipment makers hoping to cash in on China's expected $10-30bn investment in new 3G wireless networks over the next 4-5 years. Manufacturers, including Motorola (MOT), Lucent (LU), Nortel (NT) and Ericsson (ERIC), that have long dominated the Chinese mkt are faced with the possibility of losing sizable mkt share. China is expected to try to give its own equipment makers a boost by launching its 3G networks with its own technology standard, called TD-SCDMA, along with other standards. In the past 10 years, Chinese co’s Huawei and ZTE have been expanding aggressively in the global mkt and are ready to compete for 3G equipment contracts at home. China was expected to have made a decision by now on licenses for carriers to upgrade to 3G. That hasn't happened yet, in part b/c tests of the TD-SCDMA technology are taking longer than expected. "When China starts building 3G networks, it will probably have a negative impact on Western vendors," says Ping Zhao, of CreditSights. "Especially if they have hyped up their 3G expectations for China."
Barron’s Online “Inside Scoop” section reports that 4 Crocs (CROX) insiders have been stepping out of the footwear maker's shares, which have nearly doubled since its IPO in Feb. The sellers, who include CEO, a vice president and two directors, sold a total of $54.6m in stock.