The global economic crisis of 2008-2009 was the historical crisis that led to the longest and most severe economic recession since the Great Depression of the 1930s. The collapse of investment bank Lehman Brothers on 09/15/2008 is also considered the biggest failure in the history of the financial banking industry.
Throughout the 2007-2008 crisis period, market participants deeply realized the importance of financial loopholes due to the problem of lack of transparency in market information / information asymmetry (information asymmetry). The two direct consequences of information asymmetry are
Adverse Selection (adverse selection)": the market participants, due to lack of sufficient information, make wrong choices when deciding to cooperate.Moral Hazard (moral hazard)": the party with more information, after successfully cooperating (e.g., signing an insurance contract, borrowing capital...), acts based on their own interests - because they know that the partner bears most of the risk.
