The 60 Minutes segment on credit derivative swaps should be "must viewing" for anyone interested in financial regulation issues.  The premise of the segment is that previously illegal “gambling” similar to Wall Street "bucket shops" of the early 1900s was legalized by Congress in 2000, allowing for a totally unregulated market that ballooned to trillions of dollars and was largely responsible for last year’s credit crash.  Go to http://www.cbsnews.com/video/watch/?id=5274961n&tag=contentMain;cbsCarousel and watch “Financial WMDs.”

As I recall, questioning about this 2000 Act which legalized and totally deregulated these credit derivatives was what prompted Alan Greenspan to testify before Congress last year that, "I made a mistake in presuming that the self-interests of organizations, specifically banks and others, were such as that they were best capable of protecting their own shareholders and their equity." Greenspan told Congress that this was "a flaw in (his) model ... that defines how the world works." 

As Vanguard founder John Bogle subsequently noted, “…a flaw in the model…that defines how the world works” is “a hell of a big...flaw."  I would add, this "flaw" would be likely to have -- and did have -- especially big consequences when the error was made by a man who was, more than anyone else, in charge of regulating the American financial system at the time of this mistake.