Minnesota Law Review

Essay, Protecting Financial Markets: Lessons from the Subprime Morgage Meltdown

Why did the recent subprime mortgage meltdown undermine financial-market stability notwithstanding the protections provided by market norms and financial regulation? This Essay attempts to answer that question by identifying anomalies and obvious protections that failed by examining hypotheses that might explain the anomalies and failures. Although some of the anomalies and failures result from a type of tragedy of the commons (in which the benefits of exploiting finite capital resources accrue to individual market participants, whereas the costs of exploitation are distributed among an even wider class of persons), most result from three sources: conflicts, complacency, and complexity, all exacerbated by a possible fourth source known as cupidity. This framework of understanding provides critical insights into protecting financial markets.

:: View PDF

News & Events

  • Welcome

    For nearly one hundred years, the Minnesota Law Review has been a leader amongst academic legal publications. When Professor Henry J. Fletcher launched the journal in 1917, his goal was simple. It was to “contribute a little something to the systematic growth of the whole law.” Since then, the Law [...]

  • Minnesota Law Review Alum Remembered 45 Years After Death

    Minnesota Law Review alumnus Tom Cranna was honored at the Annual Banquet this Spring, 45 years after his death. Mr. Cranna was remembered for his contributions to the journal, the school, and the positive impact he had on his family and friends. The Devil’s Lake Journal published a memorial which [...]

  • Follow MLR on Twitter!

    The Minnesota Law Review is proud to announce that we are now on Twitter. Follow us @MinnesotaLawRev for information and updates concerning the petition period and deadlines, the opening and closing of article submissions, our 2014 Symposium: Offenders in the Community, and all other news concerning our authors and publications. [...]

  • Vol. 97 Lead Piece Cited in Al Jazeera Opinion Piece

    A recent Al Jazeera opinion piece that criticizes the Supreme Court’s Daimler decision cites to Volume 97′s lead piece, How Business Fares in the Supreme Court. You can read the Al Jazeera piece here. Share this: on Twitter on Facebook on Google+

  • Masthead for Volume 99 Board

    The masthead for the Board of Volume 99 of the Minnesota Law Review is now available. You can view the masthead here. Share this: on Twitter on Facebook on Google+

Newsletter

cforms contact form by delicious:days