Novastar (NFI) reported earnings after closing yesterday and BOOM! The stock dropped over 30% and has dropped over 50% within the past few weeks. Novastar is a subprime mortgage company that is facing the fact that a lot of the loans they approved will not be paid back. First New Century, now Novastar, so who is next? HSBC got hit a while ago but not as bad as these two companies.

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