Human frailty caused the crisis

Cass Sunstein and Richard Thaler argues that human bounded rationality and limited self-control played significant roles in fuelling and sustaining the ongoing financial crisis. So they suggest greater disclosure norms (eg. machine-readable files enabling third-party websites to translate hidden details of the terms), transparency, and financial awareness creation among lenders and borrowers. They also suggest nudges like minimum mandatory equity requirement in loans, loan repayments before retirement, greater benefits for faster repayments, and shortening the term of the loan if it is refinanced.