Chris Dodd’s performance on Monday was pathetic. No wonder he is not running again, because he’s been in on the scam from the start.

I am still waiting for the creative/inventive lawyer – Bugliosi would be my man, but he is retired and just writes books – who starts bringing together the investors who were scammed into a mass class action suit against each of the participants. There is an enormous amount of anger out there. It just takes someone who can channel it properly to bring these sorts of Ponzi schemes to s just end.

Enron was the tip of the iceberg of corporate scams. Madoff’s are born from this environment and you have to know there ar emany more Madoff’s out there who have yet to be discovered, but will soon.

Obama hates to look back, but if these crooks go unpunished, no amount of regulation and dopey speeches like Dodd’s will restore institutional trust in the markets. People laugh at Ralph Nader today, but he was last great consumer rights defender. We need more of them today.

Doesn’t this imply that, if one person (or a dozen, or a hundred) really believes (however irrationally) that there is a real risk the US could default, then there is nothing wrong with their wanting to insure themselves against that risk?

The article implies that buying a credit default swap is inherently unpatriotic: a “bet against the United States of America.” But wouldn’t that make SELLING a CDS a noble vote of faith in our government and way of life?… See More

What is the real problem? Taibbi isn’t clear here. Is it that the price of portfolio insurance through a CDS has doubled in the recent past? Or is it that this market exists at all?

Let’s stipulate: Some people are going to make financially risky bets in arcane markets, whether short-selling stocks, selling flood insurance, or buying pork belly futures. And they’ll end up either making or losing money on the deal. That’s not a problem per se, at least not for me.

The chief problem comes when one side loses more than they thought they could, then demands (and gets) a bail-out from the government to cushion their losses. At that point, the public has a real right to complain. So, to the extent there is an assumed government backing of one of the parties, that IS a real problem.

Another real problem with portfolio insurance (of all kinds) is that it is riskier than it looks. We should have learned that after the 1987 stock market crash, or in the wake of the junk bond collapse of the early 90s — and we should certainly have learned the inherent riskiness of credit default swaps from the AIG fiasco. Taibbi is right to point out that portfolio insurance, when practiced on a large scale, can easily become a market with a wildly unstable equilibrium, where everyone is betting based on nothing more than their expectations of other people’s expectations. (But note, this is an argument that insurance through a CDS probably costs not too much but too little; and this is at odds with Taibbi’s apparent belief that the risk of a US credit default is effectively zero.)

IF we are going to allow people to trade in credit default swaps, we need to regulate the market — at least to the point of making sure that the people who “naked sell” a CDS have the means to make good on their potentially huge losses, and that everyone understands that the function of government is not to pick up the pieces when someone’s investment goes sour.

The comparison to sports betting is completely wrong. There a better doesn’t stand to lose anything tangible if one sports team wins or another- he is just trying to get lucky, like in a lottery.

This post is horribly misleading and does a disservice to readers not informed about finance/economics.

Since straight men and gay men are already serving side-by-side, and the military considers the current system to be functional, I can’t help but wonder why there would be a radical change if we simply allow these people to admit that they’re gay. Do they think the gay men in the military can only “control” their “urges” if they pretend to be straight? Do these people honestly believe that a good soldier is suddenly going to transform into a mindless, out-of-control lech simply because he can admit that he’s gay without fear of losing his place in the military?