The Subprime Virus: Reckless Credit, Regulatory Failure, and Next Steps

Front Cover
Oxford University Press, 2016 - Business & Economics - 370 pages
The subprime crisis shook the American economy to its core. How did it happen? Where was the government? Did anyone see the crisis coming? Will the new financial reforms avoid a repeat performance?

In this lively new book, Kathleen C. Engel and Patricia A. McCoy answer these questions as they tell the story behind the subprime crisis. The authors, experts in the law and the economics of financial regulation and consumer lending, offer a sharply reasoned, but accessible account of the actions
that produced the greatest economic collapse since the Great Depression. The Subprime Virus reveals how consumer abuses in a once obscure corner of the home mortgage market led to the near meltdown of the world's financial system. The authors also delve into the roles of federal banking and
securities regulators, who knew of lenders' hazardous mortgages and of Wall Street's addiction to high stakes financing, but did nothing until the crisis erupted. This is the first book to offer a comprehensive description of the government's failure to act and to analyze the financial reform
legislation of 2010.

Blending expert analysis, vivid examples, and clear prose, Engel and McCoy offer an informed portrait of the political and financial failures that led to the crisis. Equally important, they show how we can draw lessons from the crisis to inform the building of a new, more stable, prosperous, and
just financial order.


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User Review  - rivkat - LibraryThing

The driest and most wonkish account of the current economic crisis I’ve read, with substantial attention given to possible fixes for the broken system—if we have any political appetite for them ... Read full review


1 Prologue
The Subprime Market Takes Off
Regulatory Failure

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About the author (2016)

Kathleen Engel, the Associate Dean for Intellectual Life and Professor of Law at Suffolk University Law School, is a national authority on mortgage finance and regulation, subprime and predatory lending, and housing discrimination. Professor Engel's research on financial services markets and the
laws that regulate them regularly catches the attention of the press and she presents her research in academic, banking, and policy forums throughout the country and around the world.

Patricia A. McCoy, an expert on financial services regulation, is the Connecticut Mutual Professor of Law and Director of the Insurance Law Center at the University of Connecticut. Professor McCoy analyzes consumer protection, moral hazard, and systemic risk through the lens of law, economics, and
empirical methods. Her work on the subprime market has garnered national press attention and repeated invitations to testify before Congress.

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