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Title:Transparency through financial claims with fingerprints: a free market mechanism for preventing mortgage securitization induced financial crises PDF Logo
Authors:Gründl, Helmut
Post, Thomas
Issue Date:2009
Series/Report no.:SFB 649 discussion paper 2009,018
Abstract:Lack of transparency in securitization transactions significantly contributed to the severe financial crisis of 20072009. To increase transparency we propose a new mechanism: financial claims with fingerprints. They would allow market participants at each stage of the securitization process to obtain easily full information about the underlying original risks and the superior claims that need to be satisfied before receiving their own payoffs. The fingerprint mechanism would considerably enhance transparency in securitization transactions at the expense of some transaction costs, while reducing the need for government involvement in securitization markets.
Subjects:Financial crisis
securitization
mortgage-backed securities
transparency
opaqueness
JEL:D53
E44
G14
G18
G21
G24
G28
F34
Document Type:Working Paper
Appears in Collections:SFB 649 Discussion Papers, HU Berlin

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