You know those new financial products like CMO’s, and CDO’s, and trillions in garbage loans to people who put nothing down, had inadequate income and lied about their assets. I would not really care if I were not one of the ones paying for their total lack of fiscal responsibility.
Up until 1999, we had regulations that separated the insured banks from the riskier Financial houses. Risk your shareholders money, not the FDIC’s. That Glass Steagall act was not hardly a South American style “preserve the status quo”, but a reasonable and prudent law to prevent the type of failure we see now.
Clearly the current financial meltdown was seen by many who chose to open their eyes to the “less than adequate” assets secured by the money they were lending and repackaging for sale to themselves and others. Those with their eyes closed were the “wealthy stewards” of the financial systems that made billions by selling crap to gain more. They are not stripped of their ill-gotten gains, you and I are paying for their lack of prudent planning and execution.
Take B. S. or Lehman Bros. for example, leveraged over 20 times, with little due diligence on the crap they bought held or sold swaps on. The stewards are granted their lofty positions more by the social order of the boards of directors than any real accomplishment. And given their poor performance, laws that prevent you and I from being on the hook for their bad judgments are a good thing.
If you want a free market place, the tax payer cannot be the one on the hook every time the “stewards” fail.