And the banks definitely made mistakes and are paying a price for it - but that is absolutely no reason for any decent human being, let alone any pro capitalism conservative, to be happy about any of it.
We want them to succeed. When instead they fail, it makes all of us a little less well off than we might have been. It benefits us in no way whatever. This is simply an understandable tragedy, like a car wreck. If I came up to your car wreck rubbing my hands with glee and chortling "it serves you right, you were driving too fast for the road conditions you bastard, hope you are paralyzed for life!", would this be excusable if less than perfect driving on your part was partially responsible?
This is pure class envy spite and worth of John Edwards. It does not belong on FR.
It is not that I want the banks to fail for revenge; it is that the failure of the banks will be the best market-oriented solution, and will discourage similar speculation for another dozen years or so (How long ago did that hedge fund started by the Nobel laureate economists go under?)
The problems are NOT that of the hapless homeowners, but the worldwide liquidity crisis spawned by banks not lending to one another and each bank being afraid to be the first to "mark to market" instead of "mark to model" -- thereby making it all the more likely that the stampede will be devastating when it comes. That, and the risks involved in the tens or hundreds of trillion dollars in derivatives based upon gaming the movement in securities prices.
And the CEO's who masterminded this, and who have received tens or hundreds of millions of dollars in severance -- one of them fired an underling who suggested their company was to exposed to the derivatives -- should be (to paraphrase humorist Dave Barry) : "hanged, shot, drawn and quartered, disemboweled, burned at the stake and then really hurt."
Cheers!