In the early 2000s, banks took the mortgages that they owned, created mortgage-backed securities out of them, and sold them as safe investments.

Question

Quizplus · Accepted Answer

This is a simplified explanation of the process of securitization that occurred during the housing bubble leading up to the 2008 financial crisis. Banks packaged together mortgages and sold them as investments, but many of these securities were not as safe as advertised, leading to the collapse of the housing market and widespread economic repercussions.

In the Early 2000s, Banks Took the Mortgages That They