Dodd-Frank Act: Why Asset-Backed Securities were Addressed
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Dodd-Frank Act: Why Asset-Backed Securities were Addressed

Intuition Publishing
Updated Sep 25, 2020

The securitization market thrived for many years until the global financial crisis. By allowing mortgage-originating institutions to offload residential mortgage loans of very dubious credit quality into the market, the securitization model was widely blamed for contributing to the global spread of the crisis. Here we explore the basics of securitization and the motivations for enhanced regulation of asset-backed securitization.