This report analyzes the impact of financial innovations on the global financial crisis of 2006-2009. It discusses the policies that led to the crisis, such as reversing of capital inflows, securitization of low-quality assets, and creation of more safe assets. The report also recommends measures to prevent future crises, such as maintaining equilibrium interest rates to avoid distortion of aggregate demand for financial products. The document type is an essay and the assignment type is a research paper.