The secondary mortgage market the government said previously made up 50% of mortgage capacity and it is therefore vital to the recovery.
However, as Prime Minister Gordon Brown pointed out, it must be a transparent market where the assets that are behind the securities that are being traded are identifiable .
In the past he said that the people dealing in these assets had no idea what was behind the assets they were buying, and that they had relied on triple A ratings that had been given by ratings agencies. It turned out these assets were loans made to people in the US who were barely able to pay the initial low rate of interest on the loans, and had no hope of ever repaying the loans, especially when rates increased.
