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Up to the years preceding the financial crisis of 2008, many investors acquired bonds backed by pools of sub-prime mortgages that carried investment grade ratings
Up to the years preceding the financial crisis of 2008, many investors acquired bonds backed by pools of sub-prime mortgages that carried investment grade ratings including AAA because the investors believed that these securities would never default or be downgraded. Why was it a fallacy to assign a AAA ratings to these securities backed by these mortgages?
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