We’ve been living through a government that doesn’t believe in government and has done everything to dismantle oversight and controls along with handing out government functions [Fema,ex] to incompetent cronies, or actually allowing greedy incompetents take over government functions [Blackwater,etc]. Along with an insanely costly losing war, we the people have been subjected to greedy principles but socialistic remedys have been given to those who were responsible for this mess at the taxpayers expense. Cox was specifically appointed head of the SEC to weaken oversight, which he surely accomplished. He should be drummed out and marched in the town square. Obscene bonuses and buyouts to those who failed their companies were a warning to us all that Wall St would have to implode. Allowing irresponsible lending along with the bait and switch structure of these mortgages which buyers either didn’t understand, or many who felt they could sell and make a profit on their homes in an economy with continually rising real estate values was devoid of reality…..and had to implode. I hold this administration responsible for what was apparent since 2002 as an economy headed for flameout. Bush has had no interest or expertise in doing anything constructive and his administration [as well as some Democrats] is largely responsible for having no vision or leadership. When his first two appointees as Treasury Secetaries were fired because they told the truth and Bush would have none of it, the handwriting was on the wall. Wall Streets double entry bookkeeping was tolerated and ignored by SEC. Unless we demand an end to this and vote our interests,demand reduced mortgage payments and workouts, emphasize accountability,limit payouts of Wall St salaries and bonuses we will see a repetition of this with even more disastrous consquences. Every derivative written was a scam. Hedge funds and short selling all need to be revamped. Wall Street has to be reastructured,& unless this group of scoundrels are accountable and we do not experience competence from our next government it will signal the end of the American Empire.

Let’s start with Barney Frank and Chris Dodd because the government should never have gotten involved with the freemarket system we have. And then there’s Phil Gramm, who pushed through legislation for the repeal of the Glass-Steagall Act, allowing commercial banks, investment banks, and insurers to merge and then he went off to work for UBS (Union Bank of Switzerland) lobbying Congress and the US Treasury. Thanks to him and his deregulation bill UBS was able to acquire Payne Weber. This spring, UBS had to write down $37 billion due to reckless investing in collateralized debt obligations (CDOs) — the same amount as their previous four years of profits combined — which leads us to the Investment Banks that thought they’d found a way to make easy money and greed prevailed. There’s plenty of blame to go all around. Nobody deserves to get off scot free.

The other would be unmitigated greed as noted above by previous commenters. I have the privilege of working with a smart woman who was involved with the deregulation at the SEC which was really supposed to be a consolidation of regulation — instead it became “let’s see how many ways we can get around the regulation” operation starting from the head of the SEC on down. All those folks who don’t think we should go through with the assistance seem to forget that 15 million of their fellow citizens working in financial services would be affected, as would we all. Certainly, a few greedy b******ds at the top should be punished, but the worker bees who are part of our great country’s spirit and soul shouldn’t be penalized by being put of jobs. And the word from many financial planners is that this a microcosm…and essentially smaller banks holding their own, and some are even thriving. What we need to do from the ground up is make it easy and beneficial to all to do the right thing.

The following is from the WALL STREET JOURNAL. It makes one wonder about John McCain’s ‘integrity’, and certainly his judgment respective to adding credible input into how to fix this country’s financial mess considering his precarious involvement with many culprits who are largely responsible circumstances leading up to the current crisis. IT’S JUDGMENT DAY FOR MCCAIN BY: Thomas Frank Last week, Republican presidential candidate John McCain called for a commission to “find out what went wrong” on Wall Street. It was an excellent suggestion: Public inquiries into Wall Street practices served the country well in the 1930s. And Mr. McCain has a special advantage to bring to any such investigation — many of the relevant witnesses are friends or colleagues of his. In fact, he can probably get to the bottom of the whole mess just by cross-examining the people riding on his campaign bus. So the candidate should take a deep breath, remind himself that the country comes first, pull the Straight Talk Express over at a rest stop, whistle up his media pals, and begin. Topic A should be deregulation. Financial institutions are dropping everywhere after playing with poorly regulated financial instruments; the last investment banks standing are begging the government for stricter oversight; and some of our nation’s leading champions of laissez faire have ditched that theory in an extraordinary attempt to rescue the collapsing industry. The philosophy of government that has dominated Washington for almost three decades is now in ruins, and it is up to Mr. McCain to find out exactly why we believed it in the first place. Why did government stand back and permit all the misconduct that generated all this bad debt? What particular ideas led us to believe that government should just keep its hands off and let markets run their course? Maybe the McCain Commission on Deregulation can kick off with a statement from the candidate himself. It will be helpful for the public, if painful for the senator himself, to hear about Mr. McCain’s own close brush with one of the towering figures of financial deregulation, Charles Keating, the master of Lincoln Savings and Loan. Keating had a special, urgent interest in getting Big Brother off our backs: in 1986 some meddlesome agency suspected him of massive violations of S&L regulations. Keating fought back by recruiting a handful of legislators, including Mr. McCain, to pressure S&L regulators to leave his S&L alone. A few years later, Lincoln became one of the largest financial failures in U.S. history. After that, Mr. McCain can get on to witness No. 1: Phil Gramm, a former adviser to the candidate on economic issues and for many years the heavyweight champion of financial deregulation. It was this very fellow who, as a senator, co-authored the Financial Services Modernization Act, largely trashing the old financial regulatory structure and allowed banks, insurance companies and investment houses to merge into what Mr. Gramm called “a supermarket for financial services” — supermarkets whose lousy decisions are now the wonder of the world and whose losses we will be underwriting for years to come. The public will be intrigued to hear that Mr. Gramm, who eventually became an executive at UBS, a bank known for its subprime profligacy, also regarded uncompensated environmental regulation as “nothing less than robbery.” They will want to know if he would now apply the same term to the activities of the industry on whose behalf he has labored for so many years. If Mr. Gramm’s wife Wendy happens to be on the bus, Mr. McCain might want to sort out some of the controversies that have followed her own career as a deregulator. For several years Mrs. Gramm headed the Commodity Futures Trading Commission, where her tenure is best remembered by a decision to allow certain kinds of energy trades to go unregulated. A company called Enron turned out to be the greatest beneficiary of the decision — there isn’t space here to recall the statesmanlike things they did with their newfound freedom — and they appointed Wendy Gramm to their board of directors just weeks after she stepped down from her government job. Later Mrs. Gramm went to the Mercatus Center in suburban Virginia, a thundering fortress of deregulatory theory. And here we glimpse another promising avenue of any investigation of the laissez-faire faith: the market ideology industry in Washington. Any proper assessment of this industry would also include the Competitive Enterprise Institute, the Cato Institute, the Heritage Foundation, FreedomWorks, the American Enterprise Institute, and the minor stars in the libertarian firmament, including my favorite, Bureaucrash, where punk rock meets the gold standard. There are others. Mr. McCain could call Kevin Hassett, one of his senior economic advisers, who declared back in March in the Bangkok Post that the blame for the current crisis could be laid at the feet of “out-of-control government regulation,” mainly in the form of municipal smart-growth initiatives. (That’s right: The man whispering in the candidate’s ear seemed to once believe that not-in-my-backyard suburbanites caused the worst financial collapse since 1929.) But maybe it would be best simply to agree that financial regulation really is in the country’s interest. As Mr. McCain’s hero Theodore Roosevelt said 98 years ago, “every man holds his property subject to the general right of the community to regulate its use to whatever degree the public welfare may require it.”

As I see it ……… the “fault” rests on three willing participants: Congress, the Lenders and the Buyers. Just because Government Oversights were loosened, we cannot place the blame solely on the Government. That’s like saying a business owner is to blame for being robbed in the middle of the night because the owner forgot to leave any lights on after dark. In my neck of the woods, the mentality is ………. if there’s an avenue, they’ll take it ……… and it cut both ways ……… the lenders and buyers were WILLING PARTICPANTS. This December, we will have owned our home for 20 years, initially purchased with 10% down on a 30 year mortgage @10.5% fixed lending rate. Five years ago, after years of building our credit to a respectable level, we decided to we refinance the balance of our mortgage @ 5.1% fixed lending rate. We were able to do so because we made sacrifices. To date, we have never owned a brand new car, we are frugal shoppers for food, clothing and household items and we do NOT live beyond our means. We are hurting just like most Americans with higher expenses for fuel, food and the like. We have less than 3% of our payroll left over after our monthly obligations. And much of that 3% gets absorbed into fuel and food cost fluctuations. There is no one to bail us out but ourselves. I have little sympathy for those who consciously chose to live WELL BEYOND THEIR MEANS (Scarlett O’hara mentality ……… I’ll think about that tomorrow) or for those GREEDY BASTARDS ON WALL STREET who took advantage of the markets for their own personal gain. This is not a Democrat -vs- Republican issue, it has been a “long time in the making”. Congress as an entity, the Lenders and the Buyers are ALL COMPLICIT in our current situation. As it is people like me who will be footing the bill, and doing so against my free will.