Unravelling the credit crunch

Introduction

1. What Happened?

1.1. U.S. Residential Property: The Crunch Begins

1.2. Old and New Style Banking

1.3. What Happened in the Markets: The Second Stage

1.4. Apres Lehman le Deluge: The Third Stage

2. Understanding the Slime: U.S. Residential Mortgages

2.1. Mortgage Structures and Borrowers

2.2. How Mortgages Were Made

2.3. Mortgage Lending During the Greenspan Boom

2.4. A Story of the ODM: Countrywide Financial

3. Financial Assets and Their Prices

3.1. Securities

3.2. Markets and Prices

3.3. The Liquidity of Financial Assets

3.4. What's In It For Me?

4. Liquidity and Central Banks

4.1. The Basis of Old-Style Banking

4.2. Liability Liquidity

4.3. Central Banks

4.4. Central Bank Policy in a Crunch

4.5. A Tale of Two Central Banks

4.6. A Twenty First Century Run: Northern Rock

5. The Crash of 1929 and its Legacy

5.1. The Crash of 1929 and the Great Depression

5.2. Political Reactions

5.3. The New Deal

5.4. The RFC and Other Rescuers

5.5. The Evolution of Freddie and Fannie

6. Securitisation, Tranching, and Financial Modelling

6.1. Securitisation

6.2. The Securitisation of Subprime Mortgages

6.3. Models and Hedging

6.4. Model Risk

6.5. Where Did It All Go Wrong?

6.6. The Write-downs

7. The Legacy Fails: Fannie, Freddie and the Broker/Dealers in 2008

7.1. The Growth, Distress, and Rescue of Fannie Mae and Freddie Mac

7.2. Financial Services Modernisation in the 1990s

7.3. The End of the Broker/Dealer

7.4. Lessons from the Failure of the Broker/dealer Model

7.5. Compensating Controls

8. Structured Finance

8.1. Credit Derivatives

8.2. ABS in Structured Finance

8.3. Structured Finance in the Boom Years

8.4. Insurance in Form and Name

8.5. The Rescue of AIG

8.6. Off Balance Sheet Funding

9. Municipal Finance and The Monolines

9.1. Municipal Finance

9.2. The Monolines Do Structured Finance

9.3. Insurers and Finance: A Toxic Mix?

9.4. Auction Rate Securities

10. The Rules of the Game: Accounting and Regulation

10.1. Accounting and Why It Matters

10.2. Regulation and Regulatory Capital

10.3. The Consequences of Basel 2

10.4. Regulation Away from Basel

10.5. Understanding Earnings

10.6. Japan's Lost Decade

10.7. A Comparative Anatomy of Financial Crises

11. Changes and Consequences

11.1. Transmission

11.2. The Provision of Credit to the Broad Economy

11.3. What Worked and What Didn't

11.4. Central Banks, Regulators and Accountants

11.5. Experimental Finance

11.6. The Financial System from 2009

Index