With a decade of house-price increases telling everyone that house prices only go up, and with these new mortgage derivatives seemingly eliminating a correlation problem that was deemed small to begin with and was now insurable with a CDS, you could almost begin to believe that you had what bankers call a “free option”: an asset with zero downside and a potentially unlimited upside, and one that is rated AAA by the ratings agencies. The fact that many investment funds are legally required to hold a specific proportion of their assets as AAA securities pumped demand still further.

Mark Blyth, Austerity, loc. 93