And who was proposing serious measures that would have helped?

Alan Greenspan, for one, but you wouldn’t know that Drum, because you’re a fool/retard/inattentive, illiterate gasbag.

Any major Dems?

No, in fact meaningful reform was directly thwarted by them, because they’re on the take from FNM & FRE, and those agencies actively pushed their bullshit social engineering agenda.

Economic pundits?

No. Well, a few.

Wall Street mucky mucks?

The correct terminology is “muckety-mucks,” and this is not a serious question.

Who were the unsung heroes? Help me out here.

Sometimes there are none, and this appears to be one of those times, and the fact that you’re looking for some tells me you have a reflexive proclivity to regulate, which will solve nothing. Idiots like Kevin Drum think there’s an answer to every problem, and a government agency-in-waiting to step in anywhere and everywhere.

Kevin, do people actually pay you to write? This is some of the most childish horseshit I have ever read.

Anyone asking these kinds of questions in this manner has no business opining about the current financial mess (and we all know who Drum blames, and his pseudo-solution). He can’t even get his terminology right. Pathetic.

CDS/CDL/CMO need less regulation.

The major exposed risk (lately) is counterparty risk, and maximum risk mitigation for that is a centralized exchange, backed by a clearinghouse (not by a gov’t agency or otherwise).

There is no “transparency” with counterparties on things like option assignments or short covering buy-ins, but the exchanges have a vested interest in settled trades – it’s what they do.

Exchange-based pooled risk, backed by a clearinghouse, is the most liquid intermediary available. This will be sought out by remaining newly risk-averse entities, such as hedge funds.

No government entity can provide or guarantee complete trade settlement guarantee (as currently structured), which is ultimately why Lehman & Bear blew up, so we should be backing DTCC, OCC, and the futures exchanges instead of banks. Risk-aversion will self-direct remaining mkt. participants to exchanges – no regulation needed.

Turning investment banks into commercial banks, and backing them, isn’t the answer.

By the way, I’m typing this on the netbook I bought yesterday, an MSI Wind U100.

Who the fuck cares what you’re typing on as you write, other than you, Kevin? Are you that fucking pompous that you actually think we care how you transmit your economic ignorance to the web?

And you have the gonads to comment on high finance, amateur?

GFY.

Goddamn Drum left the italics on.

Yes, he is that stupid.

There are 2 sides to every trade, and right now, the US gov’t is the slumlord, thanks to Barack fucking Oblama.

Well done, shitbags, you just elected the least qualified, zero-clue pretty-boy pseudoeducated ambulance-chaser/community “organizer,” whatever that is.

I salute you! Have fun playing make-believe with your Oprah administration.

Fuck Kevin Drum. I’ll take the countertrade of that dumbfuck all day long….

That’s an easy question to answer: stop regulating and stop bailing out.

Excuse me? What free market ideology have you read that advocates Government Sponsored Entities (GSE’s) such as Fannie Mae and Freddie Mac? What free market thinkers persuaded Congress to demand that the GSE’s expand lending to lower income, higher risk customers?

I don’t think these are the right questions.

The issue is not that there was a “bubble” that caused a lot of people to lose money. The issue is that somehow those losses became socialized. (Some would argue the expectation that the losses would be socialized is at least a partial cause of the bubble.)

So, we should not be asking “How could we have regulated things to prevent this bubble?” but “How can we regulate things to ensure bad outcomes associated with risk taking are internalized?”

Kevin posted a dialog with Felix Salmon where he claimed that the problem isn’t that CDSes didn’t pay up. It’s that they brought companies down in two other ways: 1) the companies kept bad loans on their books thinking the CDSes made them profitable, 2) companies rated AAA did not have to issue collateral to issue CDSes. So when these companies (AIG) ran into trouble and lost their AAA rating, they went bankrupt trying to make the collateral.

Please correct me If I’m wrong about that.