![]() ![]() The only problem with relying on those data and trends was that American laws and regulations had recently changed. Americans almost always made their mortgage payments. And financiers regarded them as reliable, pointing to data and trends dating back decades. Ratings agencies, like Moody's or Standard and Poor's, gave high marks to the processed mortgage products, grading them AAA, or as good as U.S. financial sector developed securities backed by mortgage payments. To meet this demand for higher returns, the U.S. After the Federal Reserve System imposed low interest rates to avert a recession after the Septemterrorist attacks, ordinary investments weren’t yielding much. The fresh 21-century interest in transforming mortgages into securities owed to several factors. They knew only that the rating agencies said it was as safe as houses always had been, at least since the Depression. ![]() The ultimate mortgage owners would often be thousands of miles away and unaware of what they had bought. Lenders would sell these mortgages onward bankers would bundle them into securities and peddle them to institutional investors eager for the returns the American housing market had yielded so consistently since the 1930s. The salesmen could make these deals without investigating a borrower's fitness or a property's value because the lenders they represented had no intention of keeping the loans. ![]() Mortgages were transformed into ever-riskier investments ![]()
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