In the United States, as you know, mortgage securitization has been dominated by two government-sponsored enterprises (GSEs), Fannie Mae and Freddie Mac, as well as by the combination of the Federal Housing Administration (FHA) and Ginnie Mae. By contrast, private-label securitization became a significant presence in mortgage securitization only during the past decade, motivated in part by developments in financial engineering.
It’s true for all of us – for Japan, for the US, for Europeans. Europe’s skeleton of Europe is weak because the institutional framework is weak. I would confirm that is a major challenge and that it puts into question the strategy of all major advanced economies, including Europe and its institutional framework.