BIS Review 57/2010  9  rate on the equivalent index swap rates, which had been negligible around the middle of the decade, suddenly rose to record levels. These events were especially worrying because they threatened to disrupt the transmission of monetary policy to the real economy.
Similarly, as we now know, the risk disclosures of various structured financial instruments were inadequate to permit purchasers of those instruments to perform a proper assessment of the risk/reward trade-off. Many investors purchased assets which they believed to have a very different risk profile than turned out to be the case. Again, there are parallels with Islamic finance.