8 In parallel, the tragic See, e.g., Daniel Aaronson, Daniel Hartley, and Bhashkar Mazumder, “The Effects of the 1930s HOLC ‘Redlining’ Map,” Working Paper No. 2017-12 (Chicago: Federal Reserve Bank of Chicago, revised August 2020), https://www.chicagofed.org/publications/working-papers/2017/wp2017-12.
In this model, the borrower often became separated from the end investor by several transactions, as credit risk was repackaged, tiered, securitized, and distributed. Many originators and distributors felt confident that long-term credit risk had been transformed into short-term "warehouse" risk prior to distribution and that distribution itself was irrevocable.