Straight

Greed As National Policy: How We Got Here

Kidding about what? Just pointing out that the article missed two important points. Also, There is no need to lay blame. Blaming does not help, especially when nothing practical can result from that except blowing off steam at one's losses, financial and/or psychologcial. Waking up to reality is more like it.

It is better to understand clearly what went wrong. Think. If an individual investor puts cash money in the hands of a persons and/or financial institutions who were making extremely risky investments in subprime mortgages, credit defaults swaps, collateralized debt obligations and other risky ventures based in a changing housing market, then they were not thinking or reasoning.They were, to put it bluntly, blindly investing into what was promoted as a good buy, properly informed, but not listening and investing, informed but not understanding or simply not responsible for carefully minding and monitoring investment options, the investments themselves or the market in general by allowing others do it for them.

The overall market began a gradual decline in the last quarter of 2007 and by mid-year 2008 it was clear that the market was sliding steadily downward. The time to rethink one's investments and move to safer bets was there and before.......

These exotics worked at first because investors paid into them, knowing or not knowing what they were, to get profit. They would not have worked and would not affect individual investors in the first place if investors informed themselves of the risk so that there was no cash flowing from them to these financial institutions for risky investments. If these institutions used their own money, then they would collapse and we, the people, would not be hurt and no rescue/bailout would necessary. Let them go down. But, greed and ignorance at every level of market investment blinds and millions of ordinary people became involved, not just corporate institutions; not just "Wall Street."

The problem also stems from having trust in people and institutions that do not deserve such trust, ever. Why do you think every one of these financial persons and/or institutions they work in (Not an anonymous Wall Street) have disclosures that you must agree to and sign that put them beyond almost all legal and financial responsibilty if an investment they manage for you goes to zero. "Tough luck if things go south" is the simply summary for all of these disclosures.

One should handle their own earnings and if one gives earnings to someone else to invest, it is better to make sure that one does not get screwed by others taking unwarranted risks with your cash, pension fund and what have you. So, if one is willing to sign or agree to such an agreement that clearly states it is on your head if things go wrong; if there is a loss, it is one's own responsibility. To say that one did not know is no excuse.

Fixing what is broken requires a clear mind. Greed is not a new financial entity nor is cleverness and cunning mixed with greed something exotic when it creates complex financial instruments designed to milk profits from an unregulated market in them. It is human financial behavior.

Your introduction to credit default swaps and one must include associated collateralized debt and bond obligations are a step up in the argument that shows that the article above misses another key factor that played a central role in Lehman's downfall and a huge ripple that widened to affect all financial institutions that used the compicated financial instruments.

With that addition, we are one step closer here to understanding the complexity and responsibilty involved in the fiscal crisis.

No kidding.

And the market will rebound as it has before and will start again. perhaps with investors somewhat wiser, if realizations set in. Now is good time not to panic but to learn about investing and financial markets and to see what next can be done to regain, if possible, what was lost.