A publication by Per Kurowski
I refer to the “Wall Street and the Financial Crisis: Anatomy of a Financial Collapse” report by the Senate Permanent Subcommittee on Investigations. It is a sort of shoddy investigative work. Why?
On April 28, 2004 the Securities and Exchange Commission authorized the investment banks to dramatically increase their leverage, among other when investing in securities backed by mortgages to the subprime sector. The SEC resolution establishes the explicit condition that it has all to be done “consistent with the Basel Standards”.
The Report of 650 pages, does not mention the Basel Committee once!
And why do the Basel Standards, issued by the Basel Committee matter? The answer is simple; it was the Basel Committee which produced and disseminated the regulatory mistake that caused this crisis. Here follows a very brief description of that fatal mistake.
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