The Harvard Law School Forum on Corporate Governance https://corpgov.law.harvard.edu The leading online blog in the fields of corporate governance and financial regulation. Sun, 17 May 2026 11:30:53 +0000 en-US hourly 1 https://wordpress.org/?v=6.5.8 https://corpgov.law.harvard.edu/wp-content/uploads/2024/02/cropped-photography-4-e1706898544564-1-32x32.png A Tale of Two Markets: Regulation and Innovation in Post-Crisis Mortgage and Structured Finance Markets – The Harvard Law School Forum on Corporate Governance https://corpgov.law.harvard.edu 32 32 A Tale of Two Markets: Regulation and Innovation in Post-Crisis Mortgage and Structured Finance Markets https://corpgov.law.harvard.edu/2019/09/11/a-tale-of-two-markets-regulation-and-innovation-in-post-crisis-mortgage-and-structured-finance-markets/?utm_source=rss&utm_medium=rss&utm_campaign=a-tale-of-two-markets-regulation-and-innovation-in-post-crisis-mortgage-and-structured-finance-markets https://corpgov.law.harvard.edu/2019/09/11/a-tale-of-two-markets-regulation-and-innovation-in-post-crisis-mortgage-and-structured-finance-markets/#comments Wed, 11 Sep 2019 13:30:21 +0000 https://corpgov.law.harvard.edu/?p=122038?d=20190911093021EDT Posted by William W. Bratton (University of Pennsylvania) and Adam J. Levitin (Georgetown University), on Wednesday, September 11, 2019
Editor's Note:

Adam J. Levitin is the Agnes N. Williams Research Professor at Georgetown University Law Center and William W. Bratton is Nicholas F. Gallicchio Professor of Law and Co-Director, Institute for Law & Economics at the University of Pennsylvania Law School. This post is based on their recent paper.

Our paper, A Tale of Two Markets: Regulation and Innovation in Post-Crisis Mortgage and Structured Finance Markets, takes the occasion of the tenth anniversary of the financial crisis to review recent developments in the structured products market, connecting the emergent pattern to post-crisis regulation.

The financial crisis stemmed from excessive risk-taking and shabby practices in the “subprime” segment of the home mortgage market, a market that got its financing from an array of “toxic” products and investment vehicles created in the structured credit market—private-label mortgage-backed securities (PLS), collateralized debt obligations (CDOs), collateralized debt obligations squared (CDO2s), synthetic securitizations, and structured investment vehicles (SIVs). These products provided the funding for the mortgage lending that enabled housing prices to be bid up in an unsustainable bubble.

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