Nice summary paper from FedNY here. Provides further evidence that it was a lack of regulatory willpower that helped cause the crash.

"Our conclusions are:
(1) The volume of credit intermediated by the shadow banking system is of comparable magnitude to credit intermediated by the traditional banking system.
(2) The shadow banking system can be subdivided into three sub-systems which intermediate different types of credit, in fundamentally different ways.
(3) Some segments of the shadow banking system have emerged through various channels of arbitrage with limited economic value…
(4) …but equally large segments of it have been driven by gains from specialization. It is more appropriate to refer to these segments as the “parallel” banking system.
(5) The collapse of the shadow banking system is not unprecedented in the context of the bank runs of the 19 th and early 20th centuries: …
(6) …private sector balance sheets will always fail at internalizing systemic risk. The official sector will always have to step in to help.
(7) The shadow banking system was temporarily brought into the “daylight” of public liquidity and liability insurance (like traditional banks), but was then pushed back into the shadows.
(8) Shadow banks will always exist. Their omnipresence—through arbitrage, innovation and gains from specialization—is a standard feature of all advanced financial systems.
(9) Regulation by function is a more potent style of regulation than regulation by institutional charter. Regulation by function could have “caught” shadow banks earlier."