a. Explain how securitization (1) transfers risk across the financial sector and (2) creates moral hazard problems.

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a. Explain how securitization (1) transfers risk across the financial sector and (2) creates moral hazard problems. You can use an example to illustrate your argument. [5 MARKS]

b. Explain how liquidity risk led to the downfall of Structured Investment Vehicles (SIVs). [5 MARKS]

Posted Date: May 18, 2024 10:10 AM

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a. Explain how securitization (1) transfers risk across the financial sector and (2) creates moral hazard problems.

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