I'm All Lost In This SuperMarket

The Washington Post's coverage of how the mad scientists of Wall Street brought world financial financial markets to the brink of collapse is a real humdinger. It's a tale of a little guy, in this case a gal, with the unlikely name of Brooksley E. Born, telling Wall Street legends Alan Greenspan, the then Federal Reserve Chairman, Treasury Secretary Robert E. Rubin and Securities and Exchange Commission Chairman Arthur Levitt Jr. that derivative swaps where a dark market shell game poising an enormous danger to the world's financial system. The fellas however had made too much money playing unregulated to be swayed by her "sky is gonna fall" exhortations. So they merely hung fire and banked.

The section of the story surrounding the devise and implementation of AIG's "Beautiful Machine," the very system which tindered the whole meltdown, makes for a particularly compelling read even for those of us who didn't attend the Wharton School of Business. In short, their craftily created credit default swaps are to three-card monte what Bernard Madoff is to me losing a 2.95 service charge to the ATM. Magnitudinaly different short cons.

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