Posts Tagged should be criminal but isn’t

Wall Street Insurance?

Ritholtz is joking, but he may be onto something here:

In order to pay for the next round of disasters some 20 years hence, we need to set up a a reserved insurance fund. This means every transaction, M&A, IPO, bond under-writing, stock trade, CDO, CDS, every RMBS, etc has a 1% premium on it.

The long standing challenge in regulating Wall Street has been the willingness of its swamp dwelling denizens to get around the regulatory structures. We outlaw Credit Default Swaps and they’ll invent Credit Swap Defaults – they’ll be almost like what we outlawed but not exactly so they’re not covered by the law. The variety of lunatic financial products from Wall Street consistently and constantly multiplies – think mold in a festering swamp or bubonic plague bacteria a rat’s bloodstream and you’ve got a good image – and keeping up with them is almost impossible; you’re shooting at a constantly moving target. Read the rest of this entry »

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