First, I want to compliment TPM Muckraker on an outstanding job of outlining the Treasury Department's approaches (or lack of them) administering this financial industry bailout into which we were so rushed earlier this fall. Second (and I apologize if this has been covered or is common knowledge) but has there been some emergency re-regulations installed to keep derivatives exchanges from collapsing the world economy even further?

It seems to me the utter lack of oversight in these highly risky instruments is what drove losses to what some economists are calling hundreds of trillions of dollars. If that's true, we haven't hit the nut of that catastrophe yet - the $700 billion bailout is a shovelful of coverage in a Grand Canyon-sized money pit. But has anything stopped this insanity? Is it still going on? Are financial whiz kids throwing our futures away on a now-worthless crap game?

Naomi Wolf asked the same thing in a "Democracy Now" interview with Amy Goodman last week:

"When exactly is the Re-regulation going to happen? This is the moment of high leverage. It is not just about firing the boss and seats on the board, it is about we regulating exactly what Larry Summers and Tim Geithner de-regulated under the Clinton administration. The real question is do these people have the humility to fix their own mistakes? My question is his Larry Summers' ego too big to fail? These guys should not be promoted at this point. Their reputations should really be destroyed by their own track records."

I'm with her. She wasn't slagging Summers over his "girls shouldn't worry their pretty li'l heads over science and engineering" crack as Harvard President; Wolf is talking about Summers' record of championing de-regulation, both as chief economist for the World Bank and in the Clinton-era Treasury. In fact, his name crops up along with Alan Greenspan and a handful of other eggheads when the Self-Correcting Market Cult is discussed.

Now Summers' name is getting painted on the frosted glass of an office door in the Obama Administration, as director of the White House National Economic Council. This guy just won't go away.

OK. Let me level with you. Here's my problem with filling up another White House with these too-smart yahoos: Their ideas crap out! Sure, the market "corrects" itself - and millions of people, along with every cent they have earned in their working lives, are corrected right down the toilet. The market corrects itself the way a nuclear reaction gently coalesces nucleae to produce a multi-kiloton detonation! In few procedures this side of frontal lobotomies do theory and reality part ways so irreversibly and catastrophically.

So... are we at least talking about plugging up some of the more egregious practices - like leveraging? (Or, borrowing - to us peasants.) How is that "leverage" system different from "margin" buying pre-1929, when the banks ran out of funny money to "buy" stocks wildly inflated by the "bubble" of... funny-money stock buying.

You know what? If I was a high-roller, say, three months ago, and I had stock in a static company - I'd take a bucket-shop bet its value was going to fall, then sell the stock. I get the full sale price plus the side-bet "derivative" payoff. Wonder if anyone did that way back then - in September? At the latest. Shoot... with nobody looking over their shoulder... no laws to be broken... how could they not game the system that and a hundred other ways? Who could resist?  

Look. Obviously, I'm not an economist. I know the big "underlying" of the late deriviative spree was the housing market. That's tubbed out, and so maybe this is all moot. Maybe the derivative market has self-corrected itself to dormancy. No money, no shell game. Right?

So... is that it? Are we safe yet?