Continued Growth and Lower Standards
The private mortgage securitization market continued to grow, and by 2004, had overtaken government/GSE mortgage backed securities issuance. (This is false, based on the cited source -- the rate of private securitization overtook the GSE rate in 2005. Total private issuance never overtook total GSEissuance) Private MBS grew primarily by lowering their standards and securitizing more low quality, high risk mortgages such as Alt-A, and subprime mortgages. Scholars have argued that this relaxation of standards was due to greater competition between securitizers for loans, and greater market power for loan originators. GSEs also relaxed their standards in response, but GSE standards remained higher than private market standards, and GSE securitizations continued to perform well compared to the rest of the market.
Read more about this topic: Residential Mortgage-backed Security
Famous quotes containing the words continued, growth and/or standards:
“Our current obsession with creativity is the result of our continued striving for immortality in an era when most people no longer believe in an after-life.”
—Arianna Stassinopoulos (b. 1950)
“That land is like an Eagle, whose young gaze
Feeds on the noontide beam, whose golden plume
Floats moveless on the storm, and in the blaze
Of sunrise gleams when Earth is wrapped in gloom;
An epitaph of glory for the tomb
Of murdered Europe may thy fame be made,
Great People! as the sands shalt thou become;
Thy growth is swift as morn, when night must fade;
The multitudinous Earth shall sleep beneath thy shade.”
—Percy Bysshe Shelley (1792–1822)
“That’s the great danger of sectarian opinions, they always accept the formulas of past events as useful for the measurement of future events and they never are, if you have high standards of accuracy.”
—John Dos Passos (1896–1970)