Economics · Financial Crises
Securitisation contributed to the global financial crisis because it:
Verified Solution4 OptionsUpdated: October 2026👁️1 View
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- 1Increased financial transparency
- 2Completely eliminated underlying credit risk
- 3Weakened incentives for prudent lending due to the 'originate-to-distribute' model✓
- 4Significantly reduced systemic leverage
Correct answer
Weakened incentives for prudent lending due to the 'originate-to-distribute' model
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