Such as pension funds insurance companies mutual

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(such as pension funds, insurance companies, mutual funds, and hedge funds). 62 This is feasible to the extent that prior to the start of the crisis, there was a liquid market for residential and commercial MBS indices, called ABX and CMBX. These indices are constructed from a representative basket of MBS of a given vintage, with two vintages per year. The idea for these indices came from the CDS market, where baskets of single-name CDS were traded in the form of a CDX index. 63 HR 4173, Title I, “Financial Stability,” Subtitle A, “Financial Stability Oversight Council,” Sec. 115, “Enhanced supervision and prudential standards for nonbank financial companies supervised by the Board of Governors and certain bank holding companies.” 64 “Basel” is shorthand for the set of international agreements on the prudential regulation of banks that have been developed since the 1980s under the auspices of the Bank for International Settlements (BIS), which is located in Basel. 65 HR 4173, Title II, “Orderly Liquidation Authority,” Sec. 204, “Orderly Liquidation of Covered Financial Companies.” 66 HR 4173, Title IX, subtitle D, Sec. 941 “Credit Risk Retention.” 67 HR 4173, Title XIV, subtitle B, “Minimum Standards for Mortgages.” 68 Other actions by the U.S. government throughout the financial crisis to deal with the mortgage market include, among others, (i) a change in the conforming loan limit from $417,000 to a maximum $729,750 (depending on the location), (ii) liquidity facilities at the Fed accepting mortgage-backed securities (MBS) collateral, (iii) purchases of MBS and government sponsored enterprise (GSE) debt by the Fed and Treasury, and (iv) Home Affordable Modification Programs by the GSEs. 69 Edwin S. Mills, “Has the United States Overinvested in Housing?” Journal of the American Real Estate and Urban Economics Association 15 (Spring 1987): 601–16; and Edwin S. Mills, “Dividing up the Investment Pie: Have We Overinvested in Housing?” Federal Reserve Bank of Philadelphia Business Review (March/April 1987), pp. 13–23. 70 According to the National Homeownership Strategy document of 1995, home ownership promotes commitment to family, good citizenship, and community, giving people greater control and responsibility over their environment and greater incentive to improve and maintain private property and public spaces. It promotes personal financial security through the accumulation of home equity. 71 Homeownership has benefits both for the individual and for society. A 2001 Harvard University Joint Center for Housing Studies working paper by William M. Rohe, Shannon Van Zandt, and George
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149 McCarthy, titled “The Social Benefits and Costs of Homeownership: A Critical Assessment of the Research” studies individual social impacts on satisfaction, psychological health, and physical health and societal social impacts on neighborhood stability, social involvement, and socially desirable youth behaviors. The authors conclude that the evidence suggests, for example, that homeowners are more
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