VoxEU.org - 3/19/2009
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Hyun Song Shin , 18 March 2009 Did securitisation disperse risks? This column argues that it undermined financial stability by concentrating risk. Securitisation allowed banks to leverage up in tranquil times while concentrating risks in the banking system by inducing banks and other financial ...
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links for 2009-03-19
Economist's View —
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In the Wake of AIG: Obama's First Priority - Robert Reich
"There's still risk it could all blow up" - Andrew Leonard
Outcry Over A.I.G., Unrelenting, Tests Geithner - NYTimes.com
Troubles in the credit rating industry - voxeu.org
Securitisation undermined financial stability - voxeu.org
They Were Against It Before They Were For It - The Plank
Failed policies of IMF again fail the poorest - Project Syndicate
Competitive devalution to the rescue - Barry Eichengreen
The belief ...
Warranty Fix for Mortgage Securitization
The Big Picture —
I continue to be surprised at the general criticism and misunderstanding of the securitization process. Some have blamed the repackaging of these debt instruments as an underlying cause of the housing boom and collapse. By extension, goes the thinking, we therefore should blame Fannie Mae (and Freddie Mac) for the collapse.
There are several problems with this explanation:
1) Fannie Mae has been securitizing mortgages for nearly three quarters of a century; If after 70 years of well functioning securitizations, how did this process suddenly cause a collapse? Teh short answer is it didn’t, something ...
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China Blocks Coke —
The Big Money 3/18/2009
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