As part of the housing and credit booms, the number of financial agreements called mortgage-backed securities (MBS) and collateralized debt obligations (CDO), which derived their value from mortgage payments and housing prices, greatly increased. Such financial innovation enabled institutions and investors around the world to invest in the U.S. housing market. As housing prices declined, major global financial institutions that had borrowed and invested heavily in subprime MBS reported significant losses. COUNT 5
QSN1 What are MBS as related to the housing and credit booms? ANS1 mortgage-backed securities QSN2 What are CDO as related to the housing and credit booms? ANS2 collateralized debt obligations QSN3 When housing prices declined, who reported significant losses from being heavily invested in subprime MBS? ANS3 major global financial institutions QSN4 Who could invest in the U.S. housing market through MBS and CDO? ANS4 institutions and investors around the world QSN5 MBS and CDO derive their value from? ANS5 mortgage payments and housing prices