Thus, relative to the broader housing market, the troubles in the subprime market should remain contained. Furthermore, the effects of rising subprime delinquencies have not seriously spilled over to the broader financial markets. Risk premiums on subprime residential-mortgage-backed securities (RMBS) and derivative products have widened considerably, as investors are requiring higher returns. However, the issuance of subprime RMBS has slowed only moderately.
Therefore, inequality in disposable income – income after direct taxes (which are progressive) and transfer payments (benefits) – is high. Inequality is not predestined.