But once the problems in the subprime market became clear, the appetite for structured products collapsed, and the process went into reverse.
When conversation turned to prospects for 2008, however, the salesmen voiced concern about credit markets and warned that problems in the subprime market could spill over and hurt demand.
The subprime market is too small to have much aggregate effect, but credit terms are getting a little meaner for mainstream borrowers too.
In other words, the fund was not simply tracking the subprime markets: it was doing better, presumably because it was buying highly rated securities.
The fund dealt only in mortgage-backed securities with top-notch credit-ratings, and not the subprime market, indicating how far the credit crisis has spread.
"We're back to where the subprime market started out 25 years ago," says Inside Mortgage Finance's publisher Guy Cecala.
As the subprime market heated up, she said, the bank pressure to move more loans - for autos, for furniture, for houses - edged into mania.
