Credit Risk Assessment: The New Lending System for Borrowers, Lenders, and Inves
Credit Risk Assessment, the new book, by Clark Abrahams and Mingyuan Zhang is a must read for anyone who desires to learn about the recent financial crisis, the various causes and effects.This book provides a clear and exceptionally well-written portrayal of the crisis from the perspective of investors, lenders, borrowers and the government.What is most remarkable about this book is the manner in which it explains very complex financial events in readily understandable terms that are accessible to virtually anyone willing to invest a few hours in a most interesting read and analysis.
The authors identify the primary causes for the current financial crisis and the perfect storm of events that precipitated the worst financial crisis since the great depression.The authors go on to explain how the process of loan underwriting, inclusive of principal-agent problems and adverse incentives, worked to create an improper assessment of the risks inherent in many financial instruments.They call for a comprehensive risk assessment framework that would provide all parties with a degree of transparency going forward that would greatly reduce the probability of another such pronounced downturn.
There are no shortage of books on the recent financial crisis, but one would be hard-pressed to find a treatment as comprehensive as this one and yet written in terms that are readily understandable. I thoroughly enjoyed this book and commend the authors on their achievement.
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Credit Risk Assessment: The New Lending System for Borrowers, Lenders, and Investors (Wiley and SAS Business Series) (Hardcover)
If the authors were still employed by a financial services organization, their employments would have been in trouble as this book reveals too much insightful information.