PRAGOTI

As the United States braces itself for the onset of a recession, much of the blame for the current downturn is being attributed to the recent subprime mortgage crisis. While boom and bust cycles in real estate markets are nothing new, what distinguishes the current crisis is that the massive run-up in home prices was driven by the proliferation of new forms of securitized finance that permitted massive sums of loan capital to be pumped into the property markets.