gdcox: I agree with your slam on President Bush to not put reins on mortgage brokers some years back. Might have avoided some, but not all, of our current problems.
But note that for economic principles (and capitalism) to work, we don’t need perfect information. We act with what we know, we seek better info, and we USUALLY avoid doing stupid things that hurt us. The sad thing about the bailout is that it would remove market incentives to do the right thing in the future.