The housing market started to collapse in 2007. It disintegrated in 2008. By now the quants had forgotten about the missteps of the previous meltdowns. They believed that with more sophisticated and complex models, the meltdowns could be a thing of the past. Increasing in popularity were asset-backed securities such as the Collateralized Debt Obligation, in which banks buy subprime mortgages and bundle them into a single instrument. The resulting CDO is then divided into tranches, each representing a claim on the underlying securities, with the highest tranche supposedly the most secure and the lowest tranche often considered equity or toxic waste.