To be sure, the just-released transcripts of the Federal Reserve meetings from 2006 do not look so terrific with the benefit of hindsight. But don't just point and laugh; you should read a bit of the transcripts yourselves. What you'll see is a very sophisticated group of people assimilating enormous amounts of information. The math and deduction that would predict the events of 2007 and 2008... well, who among us was banging that drum in mid-2006? (Okay, a few people!) But even those of us with anecdotal data—I, for instance, knew something was wrong with America when a friend who was an unemployed non-citizen immediately got a rather enormous interest-only mortgage on a vacation house!—weren't exactly raving like Cassandra. And the Fed transcripts aren't all ridiculous. Susan Schmidt Bies, who retired from the Fed in March of 2007, and then went on the Bank of America board, made a presentation on CDOs, mortgages and mortgage servicers at the Fed meeting on December 12, 2006. READ MORE

Things will be allowed to be stable again in America only when executive pay is restored to its ludicrous bubble value. Writes Felix Salmon: "People who were comfortable with seven- and eight-figure salaries a couple of years ago have a natural tendency to want to return to the status quo ante; the rest of us see a once-in-a-lifetime opportunity to bring executive pay down to the kind of levels which normal human beings can relate to. Given that the pay levels of old clearly did no good and colorably did a great deal of harm, that doesn't sound like an unreasonable request. But there aren't any mechanisms in place to make it happen...." And who will benefit? Actually, the government, because of tax income: "The government's interests, then, are naturally aligned with those of the plutocrats-and when that happens, the chances of change naturally drop to zero." What's most amazing is that Tim Geithner has been pretty direct about this! "You cannot address those long-term deficits, you cannot put the government of the United States in a position that we can go back to living within our means, unless you repair the damage done to this economy and to its revenue base." Right. The only "damage" done to the economy itself is a halt in the flood of massive amounts of revenue to really rich people. Everything else, from the housing market to unemployment, and you-that's just collateral damage.