CDOs and insider trading are orthogonal. The issue with CDOs is not the concept or the engineering but the implementation thereof. The banks (or underwriter) to

CDOs and insider trading are orthogonal. The issue with CDOs is not the concept or the engineering but the implementation thereof. The banks (or underwriter) took risky loans and labelled them as safe; and the whole idea of CDOs is about pricing risk for mortgages. So it blew off. > the industry seems to be often parasitical Most industries are. Oil, Pharmaceutical, Weapons, Government bureaucracy, etc... The list is really long. I'd say that Finance is one of the most regulated areas; but you are unlikely to notice other rip-offs (ie: oil leak that cost the tax payer and the citizen)