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Abacus ioo1, 1, 1,

Abacus ioo,1, 1i1, i,


ABS East conference, 1,,
ABX index, 1o11, 1,, i,
i,, i8, ii, o
ACA Capital, 1o, 1
Accountability
increasing sloppiness in
mortgage paperwork, 11
mortgage lending fraud, 1
systemic breakdown in, xxii
Accountant frms, 1ii
Accounting practices
AIG valuation, i,1i,i
AIG-Goldman dispute over
CDO, ioi,o
collapse of subprime
lenders, ,,
GSEs capital shortfall, 1
Lehman Brothers, ii,
mark-to-market rules, ,,
iioii,, i, i, i,,
io, i,,, ,
Adams, Stella, i1
Adelson, Mark, 11
Adjustable-rate mortgages
(ARMs), o, 1o, o, i
delinquency, i1o
hybrids, 1o,1oo
increasing popularity of, o
,, 8,
mechanism of, i
mortgage-securities
entanglement, 11
option ARMs, 1oo1o
savings and loan crisis,
Wachovias liquidity
concerns, oo
See also Option ARM loans
Adverse market conditions,
,,,
Affordable housing, o1,
,, 1818o
African Americans: jobless rate,
1
Agosta, Jeff,
Aguero, Jeremy,
AIG Financial Products, 1
1i
Alex Brown & Sons, ,
Alix, Michael, i8i, i8,, io
Allianz, 8
Ally Financial, ii,
Alt-A securitization, 1o1o,,
1ii1i,, 1o,, i1o, i1,
ii,
Alvarez, Scott, , o, io, i,
,
Alwaleed bin Talal, oi
Ambac, i,o
American Bankers Association,
1, i1
American Home Mortgage, i,1
American International Group
(AIG)
bailout, ,,1, i
CDO structuring, 1i,
11i, iooioi
credit default swaps, ,o
failure triggering crisis, xvi
fnancial crisis and bailout,
,o,
Goldman dispute over
subprime losses, io,i,
government rescue, i
lack of concern over
subprime-mortgage
failure, ii
liquidity failure, ,,
liquidity puts, 1
Merrill Lynchs CDO
tranches, io
over-the-counter
derivatives, xxvi
payment to AIG
counterparties, ,,(fg.)
risk management, xix
systemic risk after Bear
Stearns collapse, oo
o1
TARP, ,o
Ameriquest, 8, 1i1, 8, 1o,
i
Andrukonis, David, 1,18o
Antoncic, Madelyn, 181
Appraisals, infated, 1i
Arbitrage, 1oo
Archstone Smith trust, 1,o1,8
Arizona: mortgage delinquency,
i1,,
Arthur Andersen, 1ii
Ashcraft, Adam, 8
Ashley, Stephen, 18
Asset-backed commercial paper
(ABCP) programs
BNP Paribas SA loss,
i,oi,i
Countrywide, i8i,o
expanding use of, 1111
IKB as casualty, ioi8
latent subprime exposure,
io
money market funds,
i,i,,
SIVs, i,ii,
Asset-backed securities, ,(fg.)
Associates First, i
,,,
THE FINANCIAL CRISIS INQUIRY REPORT INDEX
Athan, Tom, i, io8io
Auction rate securities (ARS),
i,,i,8
Australia
house price appreciation,
iooiioo8, 1,(fg.)
housing bubble, 1,1o
Automobile manufacturers, ,,
Automotive Industry Financing
Program, ,,
Bacon, Kenneth, 18
Bailey, Kevin, 1,
Bailouts
AIG, ,1, i
controversy over Lehman
Brothers collapse,
,
Fannie Mae/Freddie Mac,
i1ii
savings and loan crisis,
o,
too big to fail principle,
,, ,,,8
Bair, Sheila C., 11, o, ,, oo,
o, ,,
Baker, Dean, ii
Bakersfeld, California, 1, 1
Balloon mortgages,
Bank of America
acquisition of Countrywide,
ii
agencies peer group study
of mortgage practices,
1,i
Bear Stearns toxic hedge
funds, i
consolidation and growth of
banks, ,
Countrywides ABCP loss,
i,o
CRA-qualifying portfolio,
iio
credit default swaps, ,o, 1i
fnancial crisis, 8i8o
fnancial sector growth, o,
GSE delinquent loans, ii,
Lehman Brothers collapse,
o,
litigation over
delinquencies, iio
money market funds, i,
mortgage fraud, 1oi
mortgage-backed securities
market losses, i,o
nontraditional loans, io
See also Investment banks
Bank runs, i,o, ,,,, o,
Bankers Trust, ,, ,
Banking
bank failure affecting
commercial real estate
market, 8
big bank bets and bank
failures, i,1
dismantling Glass-Steagall,
,i,o
failure numbers, o1
fnancial fallout from
recession,
savings and loan crisis,
,
See also Commercial banks;
Investment banks
Barber, Mark, o,
Barclays, ,
Barker, Randolph, 18
Barnes, Murray, io1io
Basel International Capital
Accords, , 1,1, 1,1
1,i
Basis Yield Alpha Fund, i,
Bass, J. Kyle, 1io, 18, i88
Baxter, Tom, i1, o, i,
,
BBB-rated securities, 1i,1i8,
11, 1
Beal, Vicki, 1oo
Bear Stearns
BSAM role in CDO
business, 11,
commercial real estate, 1,o
CSE oversight, 1,
fall of, i8oi1
fnancial sector growth, oo
government response to
collapse of, xxi
hedge fund creation,
JP Morgan purchase of, ii,
1
mortgage-backed securities
market losses, i,o
regulators concerns over
failure of, ii,
risk concentration, ii
risk exposure of hedge
funds, i8ii
synthetic CDOs, 1
See also Investment banks
Bear Stearns Asset
Management (BSAM),
11,, ii1iii, i8,
ioiio
Bear Stearns Light liquidity
scenario, i,
Bear Stearns liquidity
scenario, i,
Benefcial Mortgage, ,,
Bensinger, Steven, i, i,
Bernanke, Ben
acknowledging housing
market drop, 1,
Bear Stearns collapse, io
i1
Bear Stearns toxic hedge
funds, i1
BofA-Merrill Lynch merger,
8
concerns over Lehmans
liquidity, o
consumer advocates
concerns about mortgage
lending, i1
credit rating agencies role in
CDO structuring, 1
delinking Fed interest rate
hikes and real estate
bubble, 1o
Fed-Lite, ,,
Feds failure of housing
regulation,
fnancial crisis of ioo8, ,
global capital fows, io
housing bubble, 1,
housing prices leading to
nontraditional lending
products, i
lack of concern over
housing bubble, xxi
Lehman collapse, i,
,
measuring investment bank
liquidity risk, i,
monetary policy
contributing to credit
bubble, i1
mortgage fraud, 1,1o
predatory lending practices,
,
recession of ioo1, 8
,, i Nii\
refusal to believe in housing
market crash spillover,
ii
run on Goldman Sachs, oi
small businesses losses
during recession, ,
TARP, ,i,
underestimating magnitude
of systemic risk, i,, ii
underestimating the
housing bust, ii,
See also Federal Reserve
Bies, Susan, 1,1o, ioi1
Bisenius, Donald, 1,
Black, Dennis J., 1,18
Black, William K., 1,, 11o111,
1o
Blankfein, Lloyd, , o, ioi,,
oi, ,o
Blinder, Alan, 1
Blow up risk, i8
BNP Paribas SA, 1, i,oi,i
BNY Mellon, i8i8, i,,
,,, o1oi
Bookstaber, Richard, 1o
Born, Brooksley, ,8
Bowen, Richard, 1, 111,
1o81o
Braunstein, Sandra, ,,
Breaking the buck, i,, ,,
Breeden, Richard, ,
Brendsel, Leland, 1ii
Broderick, Craig, 1o, i,,
i,i8
Brown, Lloyd,
Brown, Richard, 1,
Bruce, Kenneth, i,o
Bubbles. See Credit bubble;
Housing bubble;
Mortgage bubble
Buffett, Warren, , , ,8,
o
Burks, Gail, 11, o,
Burry, Michael, 1
Bush, George W., , o1
Bushnell, David, io1, io
Bynum, Gregory,
Calhoun, Michael, o
California
delinquency, iio,
fallout from the crisis, o
foreclosures, o
government response to
economic shortfalls, 8
mortgage delinquency, i1,
SIV losses, i,,
underwater mortgages,
o(fg.)
California Reinvestment
Coalition (CRC), 1o, ,8
Callahan, Jim, , o8
Callan, Erin, i,
Canada: housing bubble, 1,8
CanagaRetna, Sujit, 8
Canavan, Sheila, 1,
Capital fows
insumcient capital leading
to bank failure, i8
mortgage-backed securities
losses, i,o
Capital Markets Approval
Committee (Citigroup),
1
Capital Purchase Program, ,o
Cardwell, J. Thomas, 11
Carter, Carolyn, ii
Case, Karl, 1,
Case-Shiller Index, 1,
Cash management accounts, o
Cash reserves, i,o, i88,
Cassano, Joseph, iooio1, io,
i,
Cattani, Arnold, , 1io
Causes of the crisis, xv
big bank bets and bank
failure, i,1
credit bubble, 1ii
differing theories of, 1
1,
housing bubble, iii,
mortgage securitization,
i,i,
systemic failure through
common shock, i
systemic failure through
contagion, 1i
ten essential causes, 1,
1
Cayne, Jimmy, i8ii8, i8,
Cecala, Guy, o
Center for Responsible
Lending, o
Century Financial, ,1
Chanos, Jim, i
Charles Schwab, iio
Chase Home Financial, ii,
Chau, Wing, 1o, 1i1, 18,
io
Checks and balances, ,
Cheyne Capital Management,
i,i,
Chicago Board of Trade, o
Chicago CRA Coalition, 8
Children, housing foreclosures
and, o
China
credit bubble, 1,
global capital fows,
1io
GSE securities, i1
Christie, Chris,
Ciom, Ralph, 8, 1,1o,
i8io
Cisneros, Henry, ,o
CIT Group Inc., o
Citibank
Fannie Mae involvement in
housing bubble, 1,
Maiden Lane payments,
,o,,
Citicorp: deregulation of bank
consolidation, ,
CitiFinancial, io, o8,
Citigroup
agencies peer group study
of mortgage practices,
1,i
Ameriquest acquisition, 1o
Bear Stearns toxic hedge
funds, iio
CDO losses, 1i, 1,ioo
CDO structuring, 111i
commercial banks ioo,
downturn, oio
consolidation and growth of
banks, ,
credit default swaps, ,o
deregulating bank
consolidation, ,
due diligence and
disclosure, 1o81,o
expansion of, i
failure to control excesses,
xviii
failure to heed warning
signs, 1
fnancial crisis, ,8i
fnancial sector growth, o,
lending violations, 8
liquidity puts, 1,1, 1o
i Nii\ ,,,
Citigroup (continued)
mortgage securitization, ,1,
o
mortgage-backed securities
market losses, i,o
raising capital after Bear
Stearns collapse, oi
reducing subprime exposure
through CDS, i
ioo, subprime exposure
level, iooio,
Wachovia acquisition,
o,o
warehouse lending, 11118
Civil rights, 1oo
Clark, Timothy, 1,, i8
Clarke, Vaughn, 1ii
Clarkson, Brian, 1,o, io8io,
ii1
Clawback provisions, 18
Clayton Holdings, 1oo1o8
Clearing banks, i8i8
Cleveland Ohio: predatory
lending practices, 1o
Climbing the Wall of
Subprime Worry report,
iiii
Clinton, Bill,
affordable housing, o1
Commodity Futures
Modernization Act, 8
CRA lending, ,
Gramm-Leach-Bliley Act,
,,
HOEPA, ,o
Cloutier, C.R., ,
CMLTI iooo-NCi, ,1, 11,,
11,(fg.), 11o, 11o(fg.),
1i1, 1i1, 1,, oi
Coffey, Kevin, o
Cohen, H. Rodgin, , o,
Cohn, Gary, i,
Cole, Roger, oi, o,, ,
Collateral call, ioo
Collateralized debt obligations
(CDOs), xxiv, i,io
AIG dispute with Goldman
over, io,i,
AIG involvement, 11i,
iooioi
Bear Stearns asset
management business,
11,
Bear Stearns collapse, i81
Bear Stearns toxic hedge
funds, i8i
Citigroup liquidity puts,
1,1
Citigroups synthetic CDOs,
1,ioo
Consolidated Supervised
Entity program, 1,11,
creating demand for lower-
rated tranches, 1i,1i8
creation and expansion of,
1i1
downgrading, ii8io
due diligence and
disclosure, 1,o
end of the boom, i1
Goldman Sachs, 1o,
i,i8
housing boom repackaging,
8
housing entanglement in
securities market, 8
leverage, 1
managers response to the
madness, 181o
mechanism of, 1i8(fg.)
Merrill Lynch, ioiio
Moodys ioo, downgrade,
iiii
Moodys role in, 1o1,o,
iooi1i
mortgage-backed securities
market losses, i,o
reducing subprime exposure
through CDS, i
regulators missed
opportunity, ioioo
self-fueling machine,
18818
See also Credit default swaps
Collateralized loan obligations
(CLOs), 1,1,o, io
Commercial banks and thrifts
buying and selling home
loans, 8
crisis and recession fallout,
o1
decline after Bear Stearns
collapse, o1o8
securitizing prime
mortgages, 1oi
shadow banks and, i,i8
subprime origination and
securitization, 88
See also Citigroup;
Wachovia; Washington
Mutual
Commercial Paper Funding
Facility, ,
Commercial paper market,
o1, 1111, i,i8
AIG liquidity failure, ,
o,
Citigroup involvement,
ioiio
Lehman decline, io
money market funds, ,8
post-recession fnancing,

stopping mortgage lender


funding, i
Commercial real estate,
1,1,o, ,8
Commodifcation of the
housing industry, ,o
Commodities, o
Commodity Exchange Act
(1o), o
Commodity Futures
Modernization Act
(CFMA; iooo), 8
Commodity Futures Trading
Commission (CFTC),
o8
Common shock, 1, i
Community
fallout from the crisis, 8
housing industry links to,
,
mortgage fraud, 1,1o
Community Reinvestment Act
(CRA), xxvii, ,i,,
,, i1iio, 1
Community-lending pledges,
,
Compensation controls, io
Compensation packages
Bear Stearns hedge fund
collapse, 1,
Bear Stearns preceding the
fall, i8,
CDO machine breakdown,
18
changes in the fnancial
industry, o1o
Citigroups CDO business,
18
GSE executives, iii
,,+ i Nii\
GSE penetration into
subprime market, 181
ignoring long-term
consequences, xix
Merrills ONeals severance
package, i,
mortgage brokers, o
Congress, U.S.
closing state shortfalls,
Community Reinvestment
Act, ,i
Depository Institutions
Deregulation and
Monetary Control Act,
dismantling Glass-Steagall,
,,
Economic Stimulus Act, 1i
Fannie Mae/Freddie Mac
debt, o
Fannie Mae/Freddie Mac
mission,
homeownership incentives,
Housing and Economic
Recovery Act, 1,
increasing deregulation, ,i
moratorium on OTC
regulation, 8
mortgage underwriting
standards, 1o111
regulating subprime
mortgage lending, ,o
regulating thrifts, o
Resolution Trust
Corporation, o8
savings and loan crisis, o
shadow banking, i8
TARP, ,i, o
too big to fail principle, ,
Congressional Budget Omce,
8,, oo
Congressional Oversight Panel,
xii, 8, o8
Conover, C. Todd, ,
Conseco, ,,
Consolidated Supervised Entity
(CSE) program, 1,1
1,, i8
Consumer Advisory Council of
the Federal Reserve
Board, i1
Consumer and Community
Affairs Division (Federal
Reserve),
Consumer confdence,
Consumer protection groups,
,8
Consumer spending, 8,,

Contagion, risk of, 1, 1i


Continental Illinois, o,
CoreLogic,
Corporate governance
AIG failure, ,
big bank failure, i,1
Citigroups CDO business,
1ioo
condoning mortgage fraud,
11,
failure to control reckless
practices, xviiixix
FHFA criticism of GSE
management, i1i
GSEs capital shortfall, 1
ignoring risks of housing
bubble, 181
international credit bubble,
1o
response to CDO madness,
181o
response to recession and
loss of credit, ,
Corrigan, E. Gerald, oo, i
Counterparty Risk
Management Policy
Group, oo
Countrywide, xxiii
agencies peer group study
of mortgage practices,
1,i1,
BofA acquisition, ii
commercial paper casualty,
i8i,o
expanding mortgage
originations, 8
GSE delinquent loans, ii,
GSE penetration into
subprime markets, 18
improper foreclosures, o8
mortgage fraud, 1oi
mortgage originations, 1o,
nontraditional loans, io
option ARMs, 1o,1o8
recognition of long-term
vulnerability, xxii
single-cause theories, 1
Cox, Christopher, xxi, 1,, i8,
i88, i8, o, 8
Cox, Prentiss, 1i1
Crabtree, Gary, 11,, 1
Credit bubble, 11o, i
causes of the crisis, 1,18,
ii
global capital fows,
1io
monetary policy, ioi1
repricing of risk, io
See also Housing bubble;
Housing bust; Mortgage
bubble
Credit card loans, o
Credit default swaps (CDS),
xxivxxv, i,
AIG dispute with Goldman,
io,i,, ,,,8
AIG failure, ,1
AIG liability, ,
AIGs international business,
1o
CDO machine, 11o
consumer advocates
concerns over mortgage
industry, i
economists concerns over
stability of, 1,
Goldman Sachs collapse,
1, 1,
Greenspans concerns over,
8
housing entanglement in
securities market, 8
mechanism of, ,o
reducing subprime exposure
through, i
regulators reaction to the
CDO madness, 18
synthetic CDO growth,
1o1,
systemic risk after Bear
Stearns collapse, oo
o1
See also Collateralized debt
obligations
Credit expansion, 81o1
Credit markets, xvi, 88
Credit ratings/credit rating
agencies, xxv, io
AIG CDO involvement
relying on, 111
AIG downgrade,
AIG valuation, i,
as securitization watchdogs,
1o,
i Nii\ ,,.
Credit ratings/credit rating
agencies (continued)
Bear Stearns Asset
Management business,
1,
Bear Stearns collapse,
i81i8i
CDO benefts, 1i81i
CDO structuring, 111i
Citigroup, 1
failure of subprime
mortgage-backed
securities, iii
Lehman Brothers F rating,
i,
Merrill Lynchs ioo,
subprime exposure
levels, i,
role in the crisis, 18
shorting CDOs, 11
structured fnance,
See also Moodys; Standard
& Poors
Credit scoring, o,, ,i
Credit spreads, io
Credit squeeze, 8
Credit Suisse, 8
Credit Suisse Institutional
Money Market Prime
Fund, i,
Crittenden, Gary, io, io,
Cruise, Christopher, ,8
Cuomo, Andrew, o1, ,8, 1,8
Dahlgren, Sarah, ,8
Dallavechia, Enrico, 18118i
Darling, Alistair, , o
Davidson, Andrew, 1oo
Davilman, Andrew, ii,
io,ioo
Dean Witter, ,
Debt levels, xvii
defaults on national debt, ,o
Fannie Mae borrowing, 8
household debt after the
recession, 1
increase in household debt
after iooo, 88
increase in mortgage
indebtedness, ,
18os and 1os levels, o8
recession causing cutbacks,

risky assets combined with,


xx
small businesses hesitancy
to take on new debt, ,
Defaults, mortgage, i1i1,
iiii, ioi, 8o
DEFCON calls, ioio,
Delinquencies, mortgage, i1
ii1, iiii,, i
Deposit insurance, . See also
Federal Deposit
Insurance Corporation
Depository Institutions
Deregulation and
Monetary Control Act,

Deregulation of fnancial
markets, xviii, i8, o,
,i,o
Derivatives, i8, ,,1
assessing systemic risk after
Bear Stearns collapse,
i8o1
mortgage securitization, i,
OCC expansion of allowed
activities, ,
single-cause theories, 1
See also Over-the-counter
(OTC) derivatives
Desert Community Bank,
Dickerson, Chris, io
Dimon, Jamie, 18, o, 1, i8,
i,, i,, i
Dinallo, Eric, ,, 8
Disclosure, 1o,1,o, i
Disintermediation,
Ditech, 8
Documentation on mortgage
loans, 11o111
Dodd, Christopher, 1, ,1
Dominguez, Nestor, 1,18,
18, io1
Dot-com crash, ,o1, 8,88,
1
Dow Jones average, ,,, ii,
, ,o, ,i,
Drexel Burnham Lambert, ,,
1i1o
Dreyfus fund, i8
Drysdale, 1
Dudley, William C., i1, i,
1, 1, ,
Due diligence, 1o,1,o, io
Dugan, John, 1, i1, ,,
,,
Duke, Elizabeth, ,
Duke, Ellen, io1
Dunhill CDO, i,o
Early payment defaults, i1,
Economic crisis, 1
AIG-Goldman dispute over
valuation, io,i,
AIGs lack of concern over,
ii
assessing liquidity risk
through repo markets,
ioi8
assessing systemic risk after
Bear Stearns collapse,
i8o1
asset-backed commercial
paper, io
Bear Stearns collapse,
i8oi1
BNP Paribas SA loss,
i,oi,i
Citigroups ioo, subprime
exposure level, iooio,
commercial banks decline,
o1o8
Countrywides ABCP loss,
i8i,o
credit rating agencies lack
of concern over, iii
fnancial losses of ioo,,
i,i,o
fnancial market fallout,
IKB ABCP loss, ioi8
Merrill Lynchs massive ioo,
losses, i,,i,
money market funds,
i,i,,
monoline insurers, i,oi,8
mounting subprime losses
stressing the economy,
i,o
post-housing bust indicators
of impending crisis,
ii
structured-investment
vehicles, i,ii,
See also Financial crisis
Economic growth, 8
Economic Growth and
Regulatory Paperwork
Reduction Act (1o), ,
,,z i Nii\
Economic Stimulus Act, 1i
Economist magazine, 1o, oo
Edwards, Jeffrey, i,8i,
Ehrnman, Roger, 1o8
Eichel, Scott, 1i
Eichner, Matthew, i8i, i8,,
io, o1
Einhorn, David, i,
Eisman, Steve, 1
Emerging markets, ,
Enhanced cash funds, i,
Enron, ,, 1ii, 1,, ioio,
Equity borrowing, 88
Ernst & Young (E&Y), 1,,1,8
Ethics, xxii, ioi
European American Bank,
i
European markets
credit bubble, 118
EU requirement of U.S.
consolidated supervisor,
1,o1,1
single-cause theories,
11,
See also specifc countries
Excess liquidity, xxvxxvi
Exchange-traded futures and
options, o
Fair Isaac Corporation, ,i
Falcon, Armando, Jr., o, o,
18,
Fannie Mae/Freddie Mac, xix,
xxvxxvi
bolstering the struggling
housing market, 111
capital increase, 11,
choice of meeting the
booming housing
market, 1,818,
conservatorship, io, ,
credit scoring, ,i
dual missions,
FHFA criticism of
management, i1ii
fnancial sector growth, o,
foreclosure donations, o
foreign investment fows,
1o1o
government backing despite
declining performance,
1,18
history and development of,
8i
leverage ratio, xx
mission versus safety,
o1o
mortgage fraud, 1o1
mortgage securitization, o8
,o, 1oi, i,
mortgage-backed securities
market, 1ii1i,
OCC discovery of capital
shortfall, 181
originate-to-distribute
mortgages, 8
portfolio cap relief, 1o11
regulators critical concerns
over, 1io
role in crisis, ,
sellers repurchasing
guaranteed loans, ii
iio
shadow banking, i,
single-cause theories, 1
See also Government-
sponsored enterprises
Farrell, Mike, 1
Fass, Lloyd, 18
Federal Bureau of Investigation
(FBI), 1,, 1o1
Federal Deposit Insurance
Corporation (FDIC)
AIG bailout, i
bank bailouts, i
cash management accounts,
o
Citigroups TARP funds, 8i
CRA lending, ,
creation of, i
deregulation, ,
shutting down lending, i
Wachovia acquisition, ,o
Washington Mutuals
impending collapse,
o,oo
Washington Mutuals ioo,
decline, oo
Federal Deposit Insurance
Corporation
Improvement Act
(FDICIA), ,
Federal Home Loan Bank of
Chicago, iio
Federal Home Loan Banks, i,
Federal Home Loan Mortgage
Corporation (Freddie
Mac). See Fannie
Mae/Freddie Mac
Federal Housing Association
(FHA), 8
Federal Housing Enterprises
Financial Safety and
Soundness Act (1i),
o1
Federal Housing Finance
Agency (FHFA),
1oii, 1
Federal National Mortgage
Association (Fannie
Mae). See Fannie
Mae/Freddie Mac
Federal Open Market
Committee (FOMC)
AIG bailout,
Bear Stearns hedge funds,
i1
Countrywides ABCP
casualty, i8i
declining housing prices in
iooo, i1
housing bubble
presentation, 1,81,,
1,1
restricting access to credit
after recession,
Wachovia acquisition, o
Federal Reserve
allowing bank-ineligible
activities, ,
assessing systemic risk after
Bear Stearns collapse,
i8o1
Bank of America-Merrill
Lynch merger, 8
Bear Stearns collapse,
i8oi8,
Citigroup ban, 1,
Citigroups CDO business,
181
Commercial Paper Funding
Facility, ,
community development
commitments, 8
concerns after Bear Stearns
collapse, ii,
Countrywides ABCP
casualty, i
CSE program, 1,
dot-com crash, oo
i Nii\ ,,,
Federal Reserve (continued)
failure to halt toxic
mortgage fows, xvii
Fannie Mae/Freddie Mac
mission,
Federal Open Market
Committee, 1,81,
fnancial crisis of ioo8, ,
fnancial losses of ioo,,
i,i,o
government housing policy
contributing to
irresponsible lending,
xxvii
HOEPA hearings, 1o81o
ignoring warning signs in
housing industry, , io
interest rate hikes, 1o1o
JP Morgan acquisition of
Bear Stearns, ii
lack of preparation for crisis,
xxixxii
Lehman Brothers collapse,
1, ,
LTCM disaster, ,,
measuring investment bank
liquidity risk, i,i8
monetary policy
contributing to credit
bubble, ioi1
predatory lending practices,
o
Presidents Working Group
on Financial Markets, 8
Recourse Rule, 1oo
refusal to investigate fraud,
1o
risks of innovations, ,
shadow banking, 1
short-term interest rates
after ioo1 recession, 8,
subprime mortgage lending
regulation, ,o
system failure through
contagion, 1i
TALF program, o
Wachovia acquisition, o8
Wachovias ioo, decline,
o,
Federal Reserve Act, i8,
Federal Reserve Bank of New
York
AIG bailout, ,,1, ,o
Citigroup decline, o
concerns over Lehman
liquidity, io
failure to control Citigroups
excesses, xviii
GSE emergency loans, 1o
GSEs capital surcharge, 1
housing bubble
presentations, 1,81,
lack of preparation for crisis,
xxixxii
measuring investment bank
liquidity risk, i,
Morgan Stanleys stress
during the fnancial
crisis, o1oi
OTC regulation, ,8
plea for mortgage lending
rules, 1o
Federal Trade Commission
(FTC), i
Federated Investors, i8i8,
i8
Fed-Lite, ,,, ,,
Ferguson, Roger, 1,1o, ,, oo
Ferrer, Wilfredo A., 1oo
FICO score, ,i, 18, i1,i1
Fidelity, 1
Financial Accounting Standards
Board, 11
Financial Control Group
(Citigroup), ioo
Financial Crimes Enforcement
Network (FinCEN), 1,,
1o11oi
Financial crisis, 1
AIG bailout, ,o,
Bank of America, 8i8o
Citigroup, ,8i
fallout from, 8
impact on todays economy,
1
money market funds, ,o
oo
Morgan Stanley response,
ooo
OTC derivatives, oo,
TARP, ,1,o
Wachovias liquidity
concerns, oo,1
Washington Mutual, o,
oo
See also Economic crisis
Financial Institutions Reform,
Recovery, and
Enforcement Act
(FIRREA; 18), o
Financial sector growth, ooo
Financial shock and panic, 1,
,8
Finn, Mike, ,o
First Alliance Mortgage
Company, 1i, o
First American Bank,
First Data Corporation, 1,,
First Union Bank, ,,
Fitch Ratings, 18, . See also
Credit ratings/credit
rating agencies
Fixed-rate mortgages,
Flight to quality, ,
Flipping loans, 11
Floating mortgage rate, ,
Florida
delinquency rate,
foreclosure increases, o
impact of foreclosures on
families and children,
o
mortgage delinquency, i1,
underwater mortgages,
o(fg.)
Flowers, Christopher, ,8
Fons, Jerome, 111io
Fontana, Thomas, i8
Foreclosure assistance
programs, 8o, o,
Foreclosures
Bakersfeld, California, 1
causes of, oio
CDO losses resulting from,
1
fgures on, xv
impact of recession on,
initiatives to stem, o,oo
rate of, i
renters as victims, o8
rising rate of and ongoing
damage from, oio
systemic faws in lending
practices, o,o8
Foreign investors
AIG Financial Projects
CDOs, 1o
asset-backed commercial
paper programs
casualties, ioi8
CMLTI loans, 11o(fg.)
global savings glut, 1o1o
,,, i Nii\
Forster, Andrew, ioo, i, ioo,
io
France
house price appreciation,
iooiioo8, 1,(fg.)
housing bubble, 1,1o
Frank, Barney, 1i,
Fraud
accounting scrutiny of
GSEs, 1ii1i
AIGs reduced credit rating
over manipulated
earnings, 111i
Ameriquest, 1i1
authorities refusal to
investigate, 1,1o
Bakersfeld housing market,
11,
contributing to the housing
bubble and crisis, i
crime-facilitative
environments for
mortgage fraud, 1oo1o
Fannie Mae, 1
improper foreclosures, o,
increases between 1o and
ioo,, xxii
mortgage securitization, ,,
OTC derivatives, ,
selling toxic funds to
investors, i8i
state regulation of housing,
11o
synthetic CDOs, 1i1
underwriting standards,
11o111
Fraud Enforcement and
Recovery Act (ioo), xi
Freezing, fnancial, ,8
Fremont Investment & Loan,
1,, i
Friedman, Paul, i8,
Froeba, Mark, io8
Frost, Alan, ii, io8io
Fuld, Richard, o, iii,
i,i,, o, 1
Fulmer, Ann, 1oo
Funded investors, 1(fg.)
Futures and options, o
Garn-St. Germain Act (18i),
Gasvoda, Kevin, i,
GE Asset Management Trust
Enhanced Cash Trust,
i,
GE Capital, ,o, o
Geanakoplos, John, 1,
Geithner, Timothy, xxixxii
AIG bailout, ,, ,1, ,
Bear Stearns collapse, i8,
i1
Citigroup decline, o
Citigroups CDO crisis,
1ioo
concerns over Lehmans
liquidity, i8, o
Counterparty Risk
Management Policy
Group, oo
housing entanglement in
securities market, 8
Lehman Brothers
bankruptcy, o, ,
money market funds, ,8
on market disruption and
panic, ,,
TARP, ,,
Gelband, Michael, 181
General Accounting Omce
(GAO), ,, ,
Gensler, Gary, ,
Gibson Greeting Cards, ,
Ginnie Mae, 8, 1o1
Glass-Steagall Act (1), i,
i, o, ,i,o, 1
Glenn, David, 1ii
Global capital fows, 1ii
Global Financial Stability
Report of the IMF, ii8
Globalization of fnancial
markets, xvii
Gnaizda, Bob,
Gold rush mentality, ,o
Golden West Savings, 1oo,
oo,
Goldman Sachs
AIG dispute over subprime
exposure, io,i,
AIG downgrade, o
AIG failure, ii
AIGs CDO involvement, 1o
Bear Stearns collapse, i8,
Bear Stearns toxic hedge
funds, iio
Buffett investment, o
CDO structuring, 11,
1i1o
compensation, o
CSE oversight, 1,
fnancial sector growth, o,
fraud over synthetic CDOs,
1i1
IKB as casualty of ABCP
programs, i,i8
Maiden Lane payments,
,o,8
OTC derivatives, ,o,1
reducing subprime
exposure, i,i8
run on the bank, oi
synthetic CDOs, xxvi
See also Investment banks
Goldschmid, Harvey, 1,i1,
Gonzales, Alberto, 1,, 1o
Goodman, Laurie, o, oo
Gorton, Gary, 188, ioo, io,
Government actions and
agencies
AIG bailout, ,8
Ameriquest fraud
investigation, 1i1
Bank of America-Merrill
Lynch merger, 8i8,
closing shortfalls after
recession, 8oo
concerns over Lehman
Brothers solvency,
i,i,
credit ratings link to
regulation, 11811
critical concerns over GSEs,
1io
failure to challenge fnancial
industry, 11
Fannie Mae/Freddie Mac
lobbyists, 1i
federal and state
government regulation
of banks, 1
federal and state response to
the fnancial crisis and
recession, 8oo
GSE backing despite
declining liquidity,
1,18
infated housing appraisals,
1
Lehman Brothers
bankruptcy,
i Nii\ ,,,
Government actions and
agencies (continued)
peer group study of
mortgage practices,
1,i1,
policy makers lack of
preparation for crisis,
xxixxii
refusal to acknowledge
potential crash,
refusal to heed warning
signs of nontraditional
loans, 1i
response to fnancial crisis,
,oo
single-cause theories, 1
system failure through
contagion, 1i
TARP, ,1,o
Wachovias liquidity
concerns, o,
See also Bailouts; Congress,
U.S.; Federal Reserve;
Omce of the Comptroller
of the Currency; Omce
of Thrift Supervision;
Regulation/regulators;
Securities and Exchange
Commission; Treasury
Department, U.S.
Government housing policy,
xxvxxvi, xxvii, , 1
Government National
Mortgage Association
(Ginnie Mae), 8, 1o1
Government-sponsored
enterprises (GSEs)
conservatorship, i, 1i
due diligence, 1o81o
fawed business model, xxvi
housing market drop, 1o,
ii8
mortgage delinquency,
i1oi1
See also Fannie Mae/Freddie
Mac
Gramlich, Edward, 1o11, ,,

Gramm-Leach-Bliley Act
(GLBA; 1), ,,, ,,, i,
1,1, o
Grand Teton National Park
conference, 1,
Grant, James, 1
Green Street Advisors, 8
Green Tree Financial, ,,
Greenberg, Alan, i8i
Greenberg, Maurice Hank,
111i
Greenberger, Michael, 1o
Greenspan, Alan
accepting guidance, ii
acknowledging housing
market drop, 1o1,
advocating deregulation,
CRA lending, ,i
defending decisions, i
delinking Fed interest rate
hikes and real estate
bubble, 1o
deregulating bank
consolidation, ,
deregulation of fnancial
markets, xviii, i8
dot-com crash, oo
economic growth and
fnancial resilience, 8
expansion of banks allowed
activities, ,
Feds failure of housing
regulation,
housing bubble spread, 1,8
housing entanglement in
securities market,
interest-rate cuts, 88
international credit bubble,
1o
LTCM collapse, ,8
monetary policy
contributing to credit
bubble, i1
OTC derivative regulation,
,
predatory lending practices,
111i, o
regulators declining
infuence in the housing
bubble, 1,1
risks of innovations, ,,
subprime mortgage lending
regulation, ,
Greenspan put, ooo1
Gregory, Joseph, i,
Grenadier Funding, 18
GSC Partners, 11
Guidance, i1ii, 1,
Gussmann, David, 1o1
Gutfreund, John, o
Habayeb, Elias, i, io
Halloran, Michael, i8
Hawke, John, 1, ,
Hayman Capital Partners,
i8,i88
Hedge funds
Bear Stearns collapse, i8o
Bear Stearns toxicity, i8
ii
BSAM business, 1,1o
economists concerns over,
18
Fed faith in Bear Stearns, xxi
housing entanglement in
securities market,
LTCM collapse, ,8
Merrill Lynch, i,
shadow banking, i,
surviving the fnancial crisis,
o1
See also Derivatives
Hempstead, Todd, 18i, 18
Hendricks, Darryll, 1111,
High-Grade Structured Credit
Strategies Enhanced
Leverage Fund, 1,,
ioi1
High-Grade Structured Credit
Strategies Fund, 1,,
i8, ioi1
High-yield mortgage securities,

Hockett, Ben, 1
Home Affordable Modifcation
Program (HAMP), o,
oo
Home Mortgage Disclosure
Act, i1
Home Ownership and Equity
Protection Act
(HOEPA), 1o11, ii,
,o,,, 8, ,
1o81o
Home starts, 1
Homebuilder Comfort Homes
of Florida LLC, o
HomeKeeper Program, New
Jersey, o,
Homelessness, o
Homeownership fgures, ,, 8o,
i
Household Finance Corp., o,
Household wealth, xvxvi
,, i Nii\
Housing and Economic
Recovery Act (HERA),
1,
Housing and Urban
Development
Department (HUD)
affordable housing goals,
xxvixxvii, 1
Ameriquest fraud
investigation, 1i1
Fannie Mae/Freddie Mac
debt, o
foreclosure donations, o
GSE penetration into
subprime markets, 18
18o
predatory lending report, 11
subprime mortgage lending
regulation, ,o
Housing bets, io1
Housing bubble, xvi
as warning sign,
authorities refusal to
acknowledge, 1,1,
bank borrowing and
mortgage interest rates,
8o(fg.)
banks expansion into
emerging markets, ,o
betting against CDOs, 1
big bank bets and bank
failures, i,1
causes of, ii,
CDS role in ending, 1,
1,
community and economic
links to, o
components and possible
causes, iii
credit-induced price boom,
1,,1oo
economic growth and
fnancial resilience, 8
Fannie Mae/Freddie Mac
involvement, xxvi,
1,818,
foreign investment fows,
1o1o
government incentives for
homeownership,
infated appraisals, 1i
international spread of, 1,8,
1,1o
job and industry growth
after iooo, 888
Lehmans increasing risk,
1,o1,8
leveraged loans and
commercial real estate,
1,1,o
Moodys denial of, 1i1
mortgage fraud, 1oo1o
owning the risk, iioii
policy makers lack of
awareness, xxi
predatory lending practices,
1o
predicting the burst, 1,18
quality control in the
mortgage industry, 1o,
1,o
real estate boom generating
jobs,
regulators declining
infuence, 1,o1,
risky asset holdings, xx
role in the crisis, 18
single-cause theories,
11,
See also Foreclosures;
Housing bust; Mortgage-
backed securities market;
Subprime lending
Housing bust
CDO downgrades, iiii
delinquencies, i1ii1
fnancial consequences, i
impact on families and
communities, 1
legal remedies, iiiio
rating downgrades, ii1ii
risk concentration, i1i1
Housing discrimination, xxvii
Housing policy. See
Government housing
policy
Housing prices
after ioo1 recession, 8,8o
appreciation in selected
countries, iooiioo8,
1,(fg.)
Bakersfeld, California, 1
bank borrowing and
mortgage interest rates,
8,(fg.)
boom and bust from 1, to
iooo, 1,o1,,
causes of foreclosure,
oio
correlating mortgage-
backed securities to,
181
credit-induced price boom,
1,,1oo
crisis fallout, oi
Fed interest rate cut, ,
hybrid ARMS, 1oo
increases leading to
proliferation of
nontraditional mortgage
products, i
investors assumptions about
the movement of, i8
mortgage lenders betting on
rising prices, 111
18os bubble, ,o
peak values, i1
risk concentration, i8
ioo, drops in, ioi
Housing starts, ,
HUD-Treasury report, , ,
Hunt, Dawn, o1o
Hybrid ARMS, 1o,1oo
Hybrid CDOs, 1i, 11
IBGYBG (Ill be gone, youll
be gone), 8, 1,
IKB Deutsche Industriebank,
11,, ioi8
Immigrants, housing fraud and,
1oo
Impaired securities, ii(fg.)
Independent fnance
companies, o
Independent mortgage lenders,
88o
Infated housing appraisals,
1i
Infation, i
Initial public offerings (IPOs)
of stocks, ,
Insurance, ,o. See also
American International
Group
Interbank lending, cost of,
,,(fg.)
Interest rates, i1. See also
Short-term interest rates
Interest-only loans, 1,, , 1o,
International Monetary Fund
(IMF), ii8
i Nii\ ,,,
Internet-based trading, i,
Interthinx, 1oo
Investment banks
as root cause of crisis, o
assessing systemic risk after
Bear Stearns collapse,
ooo1
buying and selling home
loans, 8
community development
commitments, ,
compensation packages,
o1o
Consolidated Supervised
Entity program, 1,11,
consolidation of insurance,
banks and securities
frms, ,o
controversy over Lehman
Brothers collapse,
,
dot-com crash, ,o1
EU demand for U.S.
oversight, 1,o
excessive borrowing, risky
investments, and lack of
transparency, xixxx
failure and loss of
confdence, i
fnancial losses of ioo,,
i,i,,
fnancial sector growth, o,
Lehman Brothers collapse
triggering fnancial
panic, ,,
leveraged loans and
commercial real estate,
1,1,o
liquidity risk measures,
ioi8
LTCM leveraging strategy,
,,
mortgage fraud, 1,1o
repo market and
commercial paper
market, o
runs on, ,,,
securitization,
shadow banking, , i,
solvency and liquidity
failure, i
subprime origination and
securitization, 88
system failure through
contagion, 1i
too big to fail, o,
See also Bear Stearns;
Goldman Sachs; Lehman
Brothers; Merrill Lynch;
Morgan Stanley
Ireland
house price appreciation,
iooiioo8, 1,(fg.)
housing bubble, 1,1o
Jackson, Alphonso, 1
Jamison, Bill, i1
Jobs
effects of recession on, o
1
fnancial sector losses after
crisis and recession, oo
o1
housing industry growth in
ioo1, 88,
jobless recovery, 8,
real estate boom generating
jobs,
See also Unemployment
Johnson, Keith, 1oo1o8
Jost, Jerry, ,o
JP Morgan
Bear Stearns collapse, i8
i8, i88
Bear Stearns collapse
leading to risk
awareness, i,i,
Bear Stearns purchase, ii,
1
Bear Stearns toxic hedge
funds, io
community development
commitments, 8
compensation, o
consolidation and growth of
banks, ,
credit default swaps, ,o
fnancial crisis, o1
fnancial sector growth, o,
GSE delinquent loans, ii,
Lehman Brothers
bankruptcy, o1,
,
mortgage-backed securities
market losses, i,o
reducing exposure to
Lehman, i8
risk concentration, ii
Washington Mutual sale,
o
Junk mortgages, io
Justice Department, 1o1o
Kashkari, Neel, oo
Keefe, Kirsten, o,
Kelly, Austin, ii
Kerr, John, i1ii
Keystone Bank, ,,,
Kim, Dow, ioi, i,,i,8
Kimball, Andrew, ioi11
King, Mervyn, 1,
Kirby, Mike, 8
Kirk, Alex, ,
KKR equity frm, 1,,
Kleros Real Estate Funding III,
1i1
Klio I, II, and III, 1o1,
Klipsch, Mark, 18, 1
Kohn, Daniel, 1,
Kolchinsky, Eric, 11, 1,
iiii
Korea Development Bank, o
Kovacevich, Richard, oo, o8
Krimminger, Michael, 8o
Land use restrictions, housing
bubble and, ii
Large Bank Supervision
Handbook, o,
LaTorre, Alejandro, ,8
Lattanzio, Dale, i,8
Lazear, Edward, 1
Leach, Brian, o1oi
Leadership Conference on Civil
Rights, 1oo
Lehman Brothers
accounting irregularity,
ii,
AIG bailout,
bankruptcy, o,
,,
bankruptcy versus failure,
8
Bear Stearns toxic hedge
funds, iio
compensation, o
concerns after Bear Stearns
failure, i,i,
controversy over failure of,
,
failure triggering crisis, xvi
,, i Nii\
failure triggering fnancial
panic, ,,
fnancial crisis, ,
fnancial sector growth, o,
increasing risk burden,
1,o1,8
lenders and supervisors
concerns over liquidity,
i,i8
Maiden Lane payments, ,o
management refusal to
acknowledge housing
bubble risks, 181
Primary Fund holdings in
ioo8, ,o,,
regulators concerns over
liquidity, i81
repo market as liquidity risk
measure, ioi8
See also Investment banks
Leverage risk, xx
Bear Stearns Asset
Management business,
1,1,
Bear Stearns window
dressing to lower ratio,
i81i8i
CDOs, 1
fnancial sector growth, o,
GSEs, o
investment banks
increasing levels from
ioo, 1,1,
Lehmans stake in Archstone
Smith, 1,o1,8
leveraged loans and
commercial real estate,
1,1,o
LTCM, ,o,,
OTC derivatives,
role in the crisis, 18
shadow banking, i, i,
Levin, Robert, 1i1i,, 18o
181, 18, i,, 11, i
Levitt, Arthur, ,, ,
Lewis, Ken, ,, 8
Lewis, Robert, i
Liar loans, io
Lindsey, Lawrence, , ,, o1, ,
Lippmann, Greg, 11
Liquidity puts, 1,1, 1o,
i, i,i8
Liquidity risk/liquidity failure,
i
AIG, ,,
Bear Stearns collapse, i88
i8, i8(fg.)
Citigroup, 8o
derivatives markets, o
o,
GSEs government backing,
1,18
GSEs portfolio cap relief,
1o11
investment banks after Bear
Stearns collapse, ioi8
Lehman Brothers, i,i,
Lehmans lenders and
supervisors concerns
over, i,i8
overdependence on short-
term liquidity, i8
role in the crisis, 18
Litigation
Goldman Sachs, i,
over delinquencies, iiiio
Loan Prospector, ,i
Loan-to-value (LTV) ratios,
1o111, i1,
Lobbying
causes of the crisis, 1o
deregulation of bank
consolidation, ,
dismantling Glass-Steagall,
,,,
Fannie Mae/Freddie Mac,
1i
Lockhart, James, i, 18o, 1o
11, 11,, io
Lombard-Wall, 1
Loney, Glenn, ,o
Long Beach Mortgage, 11,118
Long Beach Savings and Loan,
o,
Long-Term Capital
Management (LTCM),
,8, ,o,, ,, i1
Low-documentation loans,
11o111
Lowitt, Ian, ,
Ludwig, Eugene, 1,1
Lund, Thomas, 1,81,, 18i,
1o11
M Prime model, 1io
Macciaroli, Michael, i8i, io
Mack, John, ,, o
Madigan, Lisa, 111
Madness, 18818
Magnetar, 1i
Maheras, Thomas, 18, 18, ioi
Mai, Jamie, 1
Maiden Lane LLC, io, ,o,
Maker, Ruhi, 1,1o
Mann, Karen, 1,18, 1, o
Marano, Thomas, ioi1,
i8i, i8,
Market Risk Amendment to
Basel rules, 1,1
Market share, Moodys
emphasis on, io8io
Mark-to-market accounting,
,, iioii,, i, i,
i,, io, i,,, ,
Martin, William,
Martinez, Mel, ,i
Masters, Michael, oo
Mayer, Christopher, 1,8
Mayo, Michael, o
MBIA, 1i, 11, 1,8, ioo,
i,oi,,
McCarthy, Callum, o
McCleskey, Scott, io8
McCoy, Patricia, ,
McCulley, Paul, , i,1
McDade, Bart, 88, ,, ,
McDaniel, Raymond, io8i1o,
ii1, ii
McDermott, Jeannie, 1
McDonough, William, ,,
McGinn, Kevin, i, i,i
McQuade, Eugene, 181
Medicaid,
Meier, Steven, i8
Memorandum of
understanding (MOU),
i8, o
Mergers
Bank of America-Merrill
Lynch, 8i8,
Citigroup expansion, i
Merrill Lynch
AIGs CDO involvement, 1o
Bank of America merger,
8i8,
Bear Stearns toxic hedge
fund, io
cash management accounts,
o
CDO losses, 1i, ioiio
CDO structuring, 11
compensation, o
i Nii\ ,,,
Merrill Lynch (continued)
corporate governance
breakdown, xix
Countrywides ABCP loss,
i,o
credit default swaps, 1i
fnancial sector growth, oo
JP Morgan reducing
exposure to, i8
massive ioo, losses, i,,i,
mortgage-backed securities
market losses, i,o
OTC claims, ,
reducing subprime exposure
through CDS, i
repo market as liquidity risk
measure, i,
See also Investment banks
Mewbourne, Chris, oo
Michalek, Richard, i1o, ii
Michigan: underwater
mortgages, o(fg.)
Miller, Harvey, , 8
Mills, Susan, ioo
Minimum capital standards,
Minow, Nell, i,
Mishkin, Frederic, i,,
Mission Bank, Bakersfeld,
California, 1io
Mital, Aseem, 8
Mitsubishi UFJ, o
Monetary policy contributing
to credit bubble, xxv
xxvi, ioii
Money market mutual funds,
i1, , i,i,,,
i, ,ooo, i,
The Money Store, ,,
Monoline insurers, i,oi,8,
ooo1
Moodys,
AIG downgrade, ,
AIG valuation system, i,1
asset-backed commercial
paper programs, 11
11
breakdown in mortgage-
related securities, xxv
CDO machine, 1o1,o,
iooi1i
commercial real estate
status, 8
early payment default
evaluation, ii1iii
housing bust, i1
mortgage-backed securities
market, 1181ii
structured fnance,
structured-investment
vehicles, i,i
See also Credit ratings/credit
rating agencies
Moral hazard, o1
Morgan Stanley
asset growth, ,
compensation packages,
o1oi
CSE oversight, 1,
due diligence, 1o8
fnancial crisis, ooo
GSE review, 1,
mortgage-backed securities
market losses, i,o
repo market as liquidity risk
measure, i,
subprime originators, 8
See also Investment banks
Morrice, Brad, 1,,
Mortgage Bankers Association,
1, 1,, i1
Mortgage brokers, 11, o
Mortgage bubble, ii,
Mortgage Electronic
Registration Systems,
Inc. (MERS), o,o8
Mortgage fraud. See Fraud
Mortgage Insurance Companies
of America, i1
Mortgage Lenders Network,
ii
Mortgage lending
asset-backed commercial
paper programs, 11118
community development
commitments, ,
crime-facilitative
environments for
mortgage fraud, 1oo1o
four Cs of, o,
funding for, o(fg.)
government regulators
failure to challenge
fnancial industry, 11
GSE goals, 1i,
GSEs increasing importance
in ioo8, 1i
housing price surge and, i
impact of CDOs on, 1
1
increasing homeownership
after ioo1, 8o8,
second mortgages, oo
shadow banking, i
state regulation, 11111
toxic fnancial assets
stemming from, i,i,
underwriting standards,
1o111
See also Foreclosures;
Housing bubble;
Housing bust
Mortgage modifcation
programs, o,, o
Mortgage-backed securities
market, 1oi1o
Bear Stearns collapse, i8o
i81
billion-dollar losses, i,o
BSAM involvement, 1,1,
CDOs stimulating demand
for, 181o
collapsing lending standards
fueling crisis, xxiiixxiv
commercial real estate, 1,
1,o
credit rating agencies
enabling meltdown, xxv
ethical breakdown in loan
behavior, xxii
fnancial creativity, ,
GSE role in, 1ii1i,
GSE securities maintaining
value, xxvi
high-risk products, 1o111
improper foreclosures, o,
international housing
bubbles, 1o
money market collateral,
ii
Moodys downgrading of,
ii1ii
Moodys involvement in,
1181ii
mortgage modifcation to
hold off foreclosure, oo
non-GSE, 1i
over-the-counter
derivatives, xxivxxv
players involved in, 11118
policy makers failure to
control, xviiixix
,+ i Nii\
potential hazards of, ,8
rating agencies confusion
over failure of, iii
securitization transforming
mortgages into, i,
subprime originators, 8
synthetic CDO growth, 11
toxicity of, io
value by iooo, ii
See also Collateralized debt
obligations; Fannie
Mae/Freddie Mac;
Housing bubble;
Housing bust; Subprime
lending
Mosser, Patricia, 1
Moynihan, Brian, 8
Mozilo, Angelo, ,o, io, 1o8,
1,i1,, i8i,o
MSCI World Index stock fund,

Mudd, Daniel, 1, 1,8, 18


18,, 1o, 1, 1ii
Mueller, Robert, 1o
Mukasey, Michael, 1,, 1o
Murton, Arthur, 8o
Najarian, Ed, oo
Naked credit default swaps, ,o
National Archives and Records
Administration, xii
National Association of
Realtors, i1,
National City, io, 1,i
National Conference of State
Legislatures,
National Consumer Law Center
(NCLC), ,8
National League of Cities,
National recognized statistical
rating organization
(NRSRO), 11
National Transportation Safety
Board, xii
NationsBank, 8
Nevada
commercial real estate bust,
,
delinquency rate,
foreclosure increases, o
impact of foreclosures on
children, o
mortgage delinquency, i1,
underwater mortgages,
o(fg.)
Nevada Fair Housing, Inc., 11,
,8
New Century, 8o, 111, 1,,,
1oo, ii, i
New York Stock Exchange
(NYSE), o1
NIR Capital Management, 1i
No-documentation loans, 11o
111
Non-agency mortgages, o8
Nontraditional mortgages, 18.
See also Subprime
lending
Norma CDO, 1i
North Carolina: state regulation
of predatory lending, o
Notional amount of OTC
derivatives, i8o1
Omce of Federal Housing
Enterprise Oversight
(OFHEO), oi,
1ii1i, 1o, 18o18,
1o1, 1,1o,
i1i
Omce of the Comptroller of the
Currency (OCC)
CDO regulation, io,
Citigroup decline, oo
Citigroups ioo, subprime
exposure, io
Citigroups CDO business,
181
CRA lending, ,
deregulating bank
consolidation, ,
expansion of banks
admissible activities, ,
GSE review, 1,
guidance, ii
ignoring complaints of
nontraditional loans, i1
mortgage guidance delay,
1,i1,
regulating subprime
mortgage lending, ,o
state regulation of mortgage
lending, 1, o, 11111
Wachovias ioo, decline,
o,
See also Government actions
and agencies
Omce of Thrift Supervision
(OTS)
AIG liquidity failure, o,
,o,1
AIG oversight, 1,o
AIG valuation, i,
Countrywides ABCP
casualty, i
CRA compliance, ,
deregulating bank
consolidation, ,
early concerns about
housing-securities
entanglement, 1o
Lehmans increased risk, 1,8
mortgage guidance, 1,1,
regulating subprime
mortgage lending, ,o
state regulation of mortgage
lending, 1, o, 11111
Washington Mutuals ioo,
decline, oo
See also Government actions
and agencies
Ohio: foreclosure increases, o
Olson, Mark, i1, , 1,
ONeal, Stanley, ,8, o, ioi, i,
Option ARM loans, xxiii, 1o,
1o, 11,118, 1o,
Orange County, California, ,
Orient Point CDO, i,o
Originate-to-distribute, 8
Originate-to-hold, 8
Origination and securitization
of subprime mortgage
lending, 88i, 1o,, 1o,,
i,io
Oversight
Consolidated Supervised
Entity program, 1,11,
housing appraisers, 1
OTC derivatives market, 8
See also
Regulation/regulators
Over-the-counter (OTC)
derivatives, xxivxxv, o,
,o, i1i1, i8o1,
i8o, oo,
Ownit Mortgage Solutions, i
Paine Webber, ,
Palumbo, Michael, ,,
Pandit, Vikram, 1, ,
8o81
i Nii\ ,.
Panic: systemic freezing in
fnancial markets, ,
,,, 1, ,8
Park, Gene, 11, iooio1,
iooio,
Parker, Ed, 1i, 1o1
Parkinson, Patrick, 1i, 1o,
io, i, i8i
Parmer, Darcy, 1oi
Pastine, Armand, 1o
Patterson, Scott,
Paulson, Henry
Bear Stearns collapse, i8
BofA-Merrill Lynch merger,
8
Goldman Sachs collapse,
1i1o
GSE, concerns over
potential failure of, i,
o, i1
GSE capital increase, 1
GSE receivership, 1o1,
lack of concern over
housing bubble, xxi
Lehman collapse, , o,
, ,
Recourse Rule, 1oo
response to fnancial crisis,
,oo
subprime exposure as
indicator of impending
crisis, i
synthetic CDOs, 11,
TARP, ,1,
underestimating the
housing bust, ii,
Pay-as-you-go CDSs, 1o1,
Payment shock loans, 11
Payment-option ARMS, 1o,
Penn Central Transportation
Company, o
Pension funds: credit ratings
reliance, 11
Pension plans, economic
fallout,
Performance index, 1o11
Peterson, Warren, i, 1,o
Piggyback lending, 11o
PIMCO, 181o, i,1
Pinto, Ed, i1
Plepler, Andrew,
Poethig, Erika, o8
Policymaking. See Government
actions and agencies
Political action committees. See
Lobbying
Pontell, Henry N., 1o1
Pooling loans,
Population growth, housing
bubble and, ii
Porter, Katherine, o8
Portfolio cap relief, 1o11
Predatory lending practices,
1, o, i. See also
Subprime lending
Presidents Working Group on
Financial Markets, 8, ,8
Price, Joe, 8
Price, Mike, 18,
PricewaterhouseCoopers, 1ii,
io, i,1, i,
Primary Dealer Credit Facility
(PDCF), ii,, ,,
,, oi
Prince, Charles, , 1oi, 11,
1,, 1,,, 1, ioo,
ioiio,
Private mortgage insurance
(PMI) companies, ii,
Private-label securities, ,o, ,i
Procter & Gamble, o,
Property taxes,
Public Employees Retirement
Association plan
(Colorado),
Putnam, Tom, o,
Putnam Investments, ,,
Qualifed purchasers, i,
Quality standards, io
Quants (quantitative analysts),

Quick Flip, Operation, 1o1o


Raines, Franklin, o
Rajan, Raghuram, 1,
Ranieri, Lewis, io, 8o,
18818, ii1
Real estate credit bubble, 1,
Recession (ioo1), 8
Recession (ioo,ioo8), 8
commercial real estate,
,8
governments struggle to
close shortfalls, 8oo
impact on small businesses
and families, ,
jobs and house prices, o
1
Reconstruction Finance
Corporation, 8
Recourse Rule, 1oo
Redlining, xxvii
Reed, John, ,,, iioii1, io,
Refnancing, ,, 8o8,
Regulation Z, ,o
Regulation/regulators
AIG liquidity failure,
,o
asset-backed commercial
paper programs, 11
Bear Stearns collapse,
iii
CDO structuring, ioioo
checks and balances of
banking regulation, ,
Citigroup expansion, i
Citigroups CDO business,
18
commercial banks ioo,
downturn, o,o8
concerns over Lehmans
liquidity, i81
Consolidated Supervised
Entity program, 1,o1,
CRA lending, ,
credit ratings link to,
11811
dual banking system, i8
failures in regulation and
supervision aiding crisis,
xviii
futures and options
exchange, o
Glass-Steagall Act, i, i,
o, ,i,o, 1
Goldman Sachss CDO
structuring, 1i
government obstacles to
regulating unfair lending
practices, 1
GSE review, 1,18
GSEs capital increase,
11,
housing bubble, 1,o1,
infated housing appraisals,
1
international credit bubble,
1o
mortgage securitization, ,,
8o, io
,z i Nii\
OCC expansion of allowed
activities, ,
OTC derivatives, ,o
over-the-counter
derivatives, xxivxxv
predatory lending practices,
o
reaction to the CDO
madness, 18
Recourse Rule, 1oo
shadow banking, i,
single-cause theories, 1
state regulation of mortgage
lending, 1, o,,
11111
subprime mortgage lending,
,,8o
synthetic CDOs, 1i
TARP, ,,
too big to fail principle, ,
See also Deregulation of
fnancial markets;
Federal Reserve
Reich, John, ,o,1, o
Reinhart, Vincent, ,
Rejected loans, 1oo1o8
Renters, o8
Repo market, o1, i,i8
assessing systemic risk after
Bear Stearns collapse,
i8o1
Bear Stearns collapse, i8o,
i8i8, i88
Bear Stearns hedge funds,
i1ii
BNP Paribas ABCP loss, i,i
borrowing levels, 11,(fg.)
BSAM involvement, 1,
JP Morgans systemic risk
concerns, i,
liquidity risk measures,
ioi8
regulators concerns over
Bear Stearns failure, i
regulatory changes boosting
growth, 11
shutting down lending, i
Reserve Primary Fund, ,o,
,,
Residential mortgage-backed
securities, ,(fg.)
Resolution Trust Corporation
(RTC), o8,o
Rhineland program, i,i8
Ricciardi, Chris, 11, ioi
Riegle-Neal Interstate Banking
and Branching Emciency
Act, ,i
Risk Governance Diagnostic:
Recommendations and
Case for Economic
Capital Development
(Bear Stearns report),
i8i8,
Risk management
assessing systemic risk after
Bear Stearns collapse,
i8o1
bank failure, i,1
big bank failure, i
commercial banks ioo,
downturn, oo8
compensation structures,
oo
concentration in largest
frms, ii
corporate governances
failure to control, xviii
xix
derivatives, ,,1
emerging markets, ,o
GSE penetration into
subprime market, 181
18
high-risk products mortgage
products, 1o111
housing bust resulting from,
i1i1
housing industry, o
Lehmans stake in Archstone
Smith, 1,o1,8
LTCM collapse, ,8
mortgage lending, o,
option ARMs, 1o8
regulators declining
infuence on the housing
industry, 1,1
repricing of risk, ioii
role in the crisis, 18
structured fnance, i,
See also Liquidity
risk/liquidity failure
Risk-focused approach to
regulation, 1,o1,1
Robo-signers, o,
Roeder, Douglas, o8
Rokakis, James, 1o, o
Roseman, Alan, 1, i,o
Rosner, Joshua, 1,
Rubin, Robert, o, 1, ,, 1,,
ioo, ioi
Russian debt crisis, ,o, ,
St. Denis, Joseph, ioo
Salaries. See Compensation
packages
Salomon Brothers, ,, io,
Sambol, David, 1,i1,, i8
Sand states. See Arizona;
California; Florida;
Nevada
Sandler, Herb, io, 1, 1oo, 11o
Sarbanes, Paul, ,
Savings and loan crisis, ,
Savitt, Marc S., 1
Schapiro, Mary, o
Schwartz, Alan, io, i8i, i8,
i88i8, ,o
Schwartz, Faith, ,
Schwartz, Laura, 11, 1
Scion Capital, 11
Sebring Capital, i
Second mortgages, oo
Securities and Exchange
Commission (SEC)
AIG valuation, i,
Bear Stearns collapse, i8i
i8, i8o, i8
CDO regulation, io,
Citigroups CDO business,
18
Consolidated Supervised
Entity program, 1,i1,
deregulating bank
consolidation, ,
dismantling Glass-Steagall,
,,
due diligence and
disclosure, 1o,, 1o1,o
failure to protect fnancial
system, xviii
fxed commissions on stock
trades, io
Lehman Brothers decline
and collapse, io,
,
Lehmans disregard of risk
management, 1,,
LTCM collapse, ,8
Merrill Lynchs ioo,
subprime exposure, i,
i Nii\ ,,
Securities and Exchange
Commission (SEC)
(continued)
Merrill Lynchs CDO
business, io
money market fund
accounting, i,
monoline insurers, i,,
Moodys rating of mortgage-
backed securities and
CDOs, i11i1i
OTC derivatives, ,
Presidents Working Group
on Financial Markets, 8
repo markets indicating
liquidity risk, i,
Reserve Primary Fund,
o,
shadow banking,
subprime exposure as
indicator of impending
crisis, i
synthetic CDOs, 1i1
Securities Industry Association,
,
Securitization, i8, i,
early concerns about
housing-securities
entanglement, 1o
end of the boom, i1
housing bust, i1i1
role in the crisis, 18
subprime mortgage lending,
o8,i, 881
transforming mortgages
into mortgage-backed
securities, i,
warehouse lending to
mortgage originators,
11118
Senate Committee on Banking,
Housing, and Urban
Affairs, 1
Senate Permanent
Subcommittee on
Investigations, ioio,
Senate Subcommittee on
Economic Policy, i1
Senate Subcommittee on
Housing, Transportation
and Community
Development, i1
Senderra Funding, 88
Senior Loan Omcer Survey, o
Seven deadly frictions in
mortgage securitization,
1o,
Shadow banking, i,, ,i,o,
i1i1, i,,, i,
Shafran, Steve, i
Shearson, ,
Shelby, Richard, 1
Shelf registration, 1o
Sherwood, Michael, io, i,
Shiller, Robert, 1,
Shock and panic, 1, ,8
Short investors, 1i1,
1(fg.), 1,, 111,
ioi,
Short-term borrowing, costs of,
, (fg.)
Short-term interest rates, o,
,o, 8, i1
Short-term liquidity, i8
Shu, Sihan, 11
Shumer, Charles, 1i
Siddique, Sabeth, ioii, 1,i
Siegel, Jay, 1io1i1
Sieracki, Eric, i8
SIGTARP, ,8,
Simpson, William A., i1
Single-cause explanations,
11,
Sirri, Erik, 1,, i, i,
Sivak, Edward, ii
Small businesses, 8, ,o
Smith Barney, ,
Snow, John, oo, 1,i
Socit Gnrale Bank, ,
111, io8io
Solomon, Michael, oi
Solomon, Peter J., o1
Solvency failure, i
Soundview Home Equity Loan
Trust, 1,
Southern Pacifc Funding
(SFC), ,,,
Spain
house price appreciation,
iooiioo8, 1,(fg.)
housing bubble, 1,1o
Spare tire theory, ,o, ,8
Sparks, Dan, 1,
Special Inspector General for
TARP, xii
Spector, Warren, i8,
Spillenkothen, Richard, ,
Spitzer, Eliot, 111i
Stages of the crisis, 1,
Staley, Jes, o
Standard & Poors ,oo Index,
Standard & Poors (S&P)
AIG downgrade, ,
Bear Stearns collapse, i81
i8i
mortgage securitization, ,1
structured fnance,
See also Credit ratings/credit
rating agencies
State government: lending
regulations, 1, o,,
11111
State Street Global Advisors,
i8
Steel, Robert, o,, 11,,
io, oo
Stein, Kevin, 11, 1o81o
Stein, Roger, 1i1
Stephan, Jeffrey, o,
Stock market, xvi,
Stock options, o
Structured Credit committee,
1i1
Structured fnance, i8, i,
Structured Investment Vehicles,
i,
Structured-investment vehicles
(SIVs), i,ii,,
Subprime lending, 1o1(fg.)
adjustable-rate mortgages,
8,
adverse market conditions
for lenders, ,,,
as warning sign, xvii
California, 11
Citigroup expansion, i
Community Reinvestment
Act, xxvii, ,i,, ,,
i1iio, 1
credit bust destabilizing
business models, ii
delinquency, i1o
due diligence, 1o8
easy fnancing contributing
to the housing bubble,
ii
foreclosure causes, o
Goldman Sachs reducing
exposure before the bust,
i,i8
increasing access to, ,i,
increasing levels of, 11
,, i Nii\
loan origination, ,o(fg.),
88i
mortgage securitization,
o8,i
OTC derivatives during the
fnancial crisis, o
regulation, ,,8o
i/i8 and /i, mortgages,
1o,1oo
See also Adjustable-rate
mortgages; Housing
bubble; Mortgage
lending; Mortgage-
backed securities market;
Predatory lending
practices
Subsidy: Fannie Mae/Freddie
Mac, o
Sullivan, Martin, i, i,
Sumitomo Corporation, ,
Summers, Lawrence, 1,, ,8,
,8
Sun, Jake, ioo
Superior Bank, ,,
Super-senior tranches, xix,
1,1,, i,,i,, io1,
i,o
Supreme Court: federal and
state government
regulation of banks, 1
Survey of Consumer Finances,
8,
Suspicious activity reports
(SARs), 1,
SWAT teams, i,
Swecker, Chris, 1,, 1o11oi
Synthetic CDOs, 1i1o,
1(fg.), 18, 11, 1
ioo, i,, io. See also
Collateralized debt
obligations
Synthetic securities, xvi, io
Syron, Richard, 1, 1,18o,
11,, io
Systemic failure, 1
Tabe, Henry, i,
Taking the name, o1oi
Tannin, Matt, 1,, i8i
Taylor, John, 1o, 1o, o, i1
Taylor rule, i1
TCW Group, 1, 1,
Technology: mortgage market
modeling, ,i
Technology bubble, ,o1
Term Asset-Backed Securities
Loan Facility (TALF),
o, oo
Term Auction Facility (TAF),
i,,
Term Securities Lending
Facility (TSLF), i8oi8,,
i, ,
Thain, John, ,, i
Thomas, Jason, 1
Thompson, Diane, ,8
Thompson, Ken, o
/i, mortgages, 1o1oo
Timberwolf CDO, i,
Too big to fail (TBTF), ,,
,,,8, 1i
Tourre, Fabrice, i,io
Tranches
attraction of mortgage-
backed securities,
1i1i,
CDO structuring into,
111
CDOs creating demand for,
1i,1i8, 1i8(fg.)
Citigroup CDO structuring,
1,ioo
Citigroup liquidity puts, 18
Goldman Sachs synthetic
CDOs, 11
Moodys ratings, 1io1ii
See also Collateralized debt
obligations; Super-senior
tranches
Tranching loans, , ,o,i,
,(fg.), 11,11,,
11o(fg.), oo
Transparency, xixxx
Travelers Insurance:
deregulation of bank
consolidation, ,
Treasury bills, ,o
Treasury bonds, o1
Treasury Department, U.S.
Citigroup TARP funds, 81
concerns over GSEs, 1o
GSE emergency line of
credit, 1o
lack of preparation for crisis,
xxixxii
Lehman Brothers collapse,
,
measuring investment bank
liquidity risk, i,i8
mortgage fraud, 1,, 1o11oi
predatory lending report, 11
Presidents Working Group
on Financial Markets, 8
savings and loan crisis, o
subprime mortgage lending,
,8,
supporting GSEs, xxvi
TARP, ,,,
Trichet, Jean-Claude, 1,
Tri-party repo market, i8
i8, i81, ,,
,, o1
Triple-A mortgage-backed
securities, 1oo
Troubled Asset Relief Program
(TARP), xii, ,o, ,1
,o, 81, o, oo, o,,
, o
Turner, Adair, o
i/i8 mortgages, 1o1oo
UBS Securities, 1i, 11, 1
1, iio
Underemployment rate, o1
Underwater mortgages,
o(fg.)
Underwriting standards, 1o,,
1o111
Unemployment
Cleveland, 1o
during ioo,, i
fgures on, xv
foreclosure and, oio
increase in metropolitan
areas, i
Unfettered markets, i
United Kingdom
house price appreciation,
iooiioo8, 1,(fg.)
housing bubble, 1,1o
Lehman Brothers
bankruptcy, ,o
University endowments: credit
ratings reliance, 11
Upton, Robert, i81i8i, i8o,
i88
Value at Risk (VaR) model, ,
i,
Varley, John, ,
Vasile, Marie, i
i Nii\ ,,
Vertical integration mortgage
model, io
Veterans Administration (VA),
8
Vicente, Danielle, o
Viniar, David, i,, i,, ,,
Volcker, Paul, , ,
Wachovia
acquisition by Wells Fargo,
i
consolidation and growth of
banks, ,
credit default swaps, ,o
fnancial crisis, oo,1
Goldman Sachss CDOs,
1, 1,
refusal to follow state
regulation, 1
ioo, decline, ooo
Wachter, Susan M., 1,
Wagner, Ira, 1
Wagstaff, Bruce, 8
Waivers, mortgage loans,
1oo1o
Wall Street. See Banking;
Commercial banks and
thrifts; Corporate
governance; Investment
banks
Warehouse lending, 11118
Waring, Brad, ,1
Warne, Janice, 18, io1
Warning signs, xvii, , 1,1
Warrack, Tom, ii
Warsh, Kevin, i1, io, i1, oo
Washington Mutual, xxiii, o
agencies peer group study
of mortgage practices,
1,i
fnancial crisis, o,oo
mortgage-backed securities
deals, 11,118
nontraditional loans, io
option ARMs, 1o,1o8
ioo, decline, oi, ooo,
Websites, xii
Weill, Nicolas, ii1iii
Weill, Sandy, ,,, oo
Wells Fargo
agencies peer group study
of mortgage practices,
1,i
consolidation and growth of
banks, ,
fnancial sector growth, o,
GSE delinquent loans, ii,
litigation over
delinquencies, iio
mortgage fraud, 1oi
nontraditional loans, io
Wachovia acquisition, i,
o,,o
Westreich, Anthony, ,
Wilcox, Ellen, 1o
Williams, Clarence, o
Williams, Julie, 1
Willumstad, Robert, i,,
,8
Wilson, David, o,
Winer, Mark, 1i1i,, 181
18i
Winslow, F. Dana, o,o8
Witt, Gary, 1,, 1, io8
Wood, Jonathan, ooo1
WorldCom, ,
Wyman, Oliver, i8i8,
Yield spread premiums, xxii
Yingling, Edward, ,
Yoshizawa, Yuri, 1,o, i11
Zandi, Mark, i, i1i1,
Zero-loss tolerance concept,
i,o
, i Nii\