For a variety of reasons, market participants did not accurately measure the risk inherent with financial innovation such as MBS and CDOs or understand its impact on the overall stability of the financial system. For example, the pricing model for CDOs clearly did not reflect the level of risk they introduced into the system. Banks estimated that $450bn of CDO were sold between "late 2005 to the middle of 2007"; among the $102bn of those that had been liquidated, JPMorgan estimated that the average recovery rate for "high quality" CDOs was approximately 32 cents on the dollar, while the recovery rate for mezzanine CDO was approximately five cents for every dollar.
What are the reasons market participants did not understand the impact financial innovation products would have?
a variety of reasons

Input: Modern history
In 1912, the Republic of China was established and Sun Yat-sen was inaugurated in Nanjing as the first Provisional President. But power in Beijing already had passed to Yuan Shikai, who had effective control of the Beiyang Army, the most powerful military force in China at the time. To prevent civil war and possible foreign intervention from undermining the infant republic, leaders agreed to Army's demand that China be united under a Beijing government. On March 10, in Beijing, Shikai was sworn in as the second Provisional President of the Republic of China.

Who had control of the Beiyang army?
Output: Yuan Shikai

Input: Article: In 1949, the city was chosen to be the seat of the Council of Europe with its European Court of Human Rights and European Pharmacopoeia. Since 1952, the European Parliament has met in Strasbourg, which was formally designated its official 'seat' at the Edinburgh meeting of the European Council of EU heads of state and government in December 1992. (This position was reconfirmed and given treaty status in the 1997 Treaty of Amsterdam). However, only the (four-day) plenary sessions of the Parliament are held in Strasbourg each month, with all other business being conducted in Brussels and Luxembourg. Those sessions take place in the Immeuble Louise Weiss, inaugurated in 1999, which houses the largest parliamentary assembly room in Europe and of any democratic institution in the world. Before that, the EP sessions had to take place in the main Council of Europe building, the Palace of Europe, whose unusual inner architecture had become a familiar sight to European TV audiences. In 1992, Strasbourg became the seat of the Franco-German TV channel and movie-production society Arte.

Now answer this question: When did the European Parliament begin meeting in Strasbourg?

Output: 1952

Article: The coats of domestic dogs are of two varieties: "double" being common with dogs (as well as wolves) originating from colder climates, made up of a coarse guard hair and a soft down hair, or "single", with the topcoat only.

Question: Along with a gruff guard hair, what else makes up the double coat?
Ans: soft down hair

Here is a question about this article: Others have pointed out that there were not enough of these loans made to cause a crisis of this magnitude. In an article in Portfolio Magazine, Michael Lewis spoke with one trader who noted that "There weren't enough Americans with [bad] credit taking out [bad loans] to satisfy investors' appetite for the end product." Essentially, investment banks and hedge funds used financial innovation to enable large wagers to be made, far beyond the actual value of the underlying mortgage loans, using derivatives called credit default swaps, collateralized debt obligations and synthetic CDOs.
What is the answer to this question: What financial innovation allows investment banks and hedge banks to make large wagers?
****
So... derivatives

Article: China: The torch returned to China for the first time since April. The torch arrived in Sanya, Hainan on May 4 with celebrations attended by International Olympic Committee (IOC) officials and Chinese big names like Jackie Chan. The entire relay through Mainland China was largely a success with many people welcoming the arrival of the torch along the way.

Question: After its April departure, when did the torch return to China?
Ans:
May 4