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  • Weirdly though, the US have that with Fannie Mae anyway, so it seems peculiar that they still need the repackaging. I'm not going to pretend I know how all this works — i'm sure with the right regulation, it could still be a good system.

    And, as here, hasn't the 'money multiplier' income model for banks been debunked somewhat, since private banks create new money with new lending?

    (Gonna change my username now — don't want work checking up on me chatting shit about banks during work hours…)

  • Weirdly though, the US have that with Fannie Mae anyway, so it seems peculiar that they still need the repackaging

    Fannie (and the other agencies) are the repackager. The agencies buy loans from banks / other originators and fund those purchases by issuing MBS. MBS are acquired by a whole host of buyers including insurers and pension funds (at the senior end) and credit funds (at the junior end). MBS are guaranteed by the issuing agency and the agency is backstopped by the federal government.

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