[scudco]

I think I can agree that CEOs will always take the highest-risk/highest-reward these days because the government continually bails-out this kind of bad behavior. However, I think it is the government itself which is the root cause of all these failures. We have a fractional-reserve banking system propped up by a fiat currency. This means credit is easily created and when the government decides that everyone should own a home (Fannie and Freddie) then we use our fractional-reserve system to lend money which, frankly, does not exist. This leads to the business cycle of endless booms and busts. I think that rich people will take advantage of this system of easy credit. This is exactly what happens when you subsidize something--you get more of it. In this case we are subsidizing risky financial behavior. If the government did not run the banks in this country then Fannie and Freddie would be forced to default on a majority of their loans and a lot of people would be hurt, but we're essentially just making our children and grandchildren inherit our debt because we believe that home ownership in 2008 is more important than long-term financial stability. We should work to end the monopoly the federal government has on the banking industry so that consumers can demand more fiscally responsible credit managers (or riskier ones if they so choose). Right now we all have to put our faith in a currency backed by winks and nods rather than something with implicit scarcity. And beyond that, we put the printing presses under the control of the government, which has most assuredly wasted more money funding a welfare/warfare state than any bailout would ever amount to.