ABSTRACT :: The House Financial Services Committee recently concluded that lack of regulation of private-label mortgage-backed securities (MBS) is to blame for the unsustainable housing bubble that peaked in mid-2006-and consequentially, the economic crisis that ensued when the bubble burst. It is true that the Secondary Mortgage Market Enhancement Act of 1984 largely exempted private-label MBS from securities regulation, however, this Article concludes that lack of regulation of private-label MBS did not cause the unsustainable housing bubble and resulting economic crisis. On the contrary, government interference caused the unsustainable housing bubble and resulting economic crisis through government sponsored entities competing in the MBS marketplace coupled with federal housing policy, particularly the Community Reinvestment Act, which encouraged banks to take undue risk.
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December 2013, Vol. 65, No. 6
Adam Mossoff, The Trespass Fallacy in Patent Law
Alan White & Carolina Reid (Essay), Saving Homes? Bankruptcies and Loan Modifications in the Foreclosure Crisis
Lee Harris, CEO Retention
Jennifer Koh, Rethinking Removability
Katrina Wyman & Nicolas Williams, Migrating Boundaries