Securitized products, when used wisely, have the potential to be one of the most valuable financial innovations of the modern financial era. The capital markets as a whole, and securitization in particular, possess the potential to increase the availability of, and make less expensive, financing for most businesses and consumers.
The unprecedented crisis in the capital markets today, which many believe was precipitated by the crisis in the subprime mortgage financing space, has once again put the securitization industry on the defensive. It is not only on the defensive; it is also in need of reform and its practitioners are working earnestly now to put our house in order.
The recovery of the capital markets in general and securitization in particular are crucial to the recovery and prosperity of the American (and world) economy. It would be a tremendous step backward to allow them to wither or to lose their vitality. It is for this reason that Credit Market & Subprime Distress: Responding to Legal Issues was written: to help to explain what has happened, why it has happened, what may yet happen and with the benefit of such knowledge to attempt to recommend the manner in which the securitization industry can begin to recover.
Foreword by Jason Kravitt