Last year, Wilbur Ross warned about problems in the financial markets. That is, there would be issues with liquidity and that dealmakers – especially on the private equity side – were paying too much on transactions.

So far, he's looking prescient. Then again, Ross is a restructuring guru and has been spot-on with plays on steel and telecom.

Well, BusinessWeek.com has a great interview with Ross.

What is his perspective on the latest turmoil on subprime mortages?

Interestingly enough, Ross's investment firm -- W.L. Ross & Co – lent $50 million into American Home Mortgage Investment, which went bust because of iffy mortgages.

So will there be a turnaround in subprime? He thinks so – but don't rush in. After all, Ross looks at the long haul.

Essentially, he thinks that the subprime market is valid – and that there's a need for it. But, the problem was that loans had rates that did not reflect the risk. Ross calls it "risk-ignored rate of return."

To get the full interview, click here.

Tom Taulli is the author of various books, including the Complete M&A Handbook and the EDGAR-Online Guide to Decoding Financial Statements.