“First, poor CDO performance was primarily a result of the inclusion of low quality collateral originated in 2006 and 2007 with exposure to the U.S. residential housing market. Second, CDO underwriters played an important role in determining CDO performance. Lastly, the failure of the credit ratings agencies to accurately assess the risk of CDO securities stemmed from an overreliance on computer models with imprecise inputs. Overall, my findings suggest that the problems in the CDO market were caused by a combination of poorly constructed CDOs, irresponsible underwriting practices, and flawed credit rating procedures.”
Can someone explain to me how this is anything more than regurgitation, at best? At the time of writing/publication I could have asked Joe the Plumber and he would have been able to offer up these tidbits! I don’t see how this can be considered novel or insightful in the least.