Financial crisis origins shift from banks to non-bank intermediaries, sparking global turmoil.
The financial crisis of 2007-09 was caused by failures in the system of financial intermediation, not just banks. This crisis was different because it involved non-bank financial intermediaries like issuers of asset-backed commercial paper (ABCP). These non-bank entities played a significant role in the crisis by experiencing disruptions in their funding mechanisms, which worsened the overall impact of the crisis. This highlights the importance of understanding the evolving landscape of financial intermediation beyond traditional banking institutions.