From the case data - the scam was going on from 2005 - at least. Thats way before Too Big to Fail, and even before the domino of the Mortgage Market fell. What

From the case data - the scam was going on from 2005 - at least. Thats way before Too Big to Fail, and even before the domino of the Mortgage Market fell. What would have happened if they weren't bailed out can be answered - They would act the same way they were already acting. The problem is with the financial industry. I promise you. Heck, its not incentives, they just don't give a shit. Really. At one point someone was designing CDOs to explode, so that they could take the insurance money. Except that once financial jargon is applied to this, it stops being fraud and its starts being "caveat emptor". EdIT: The creator of above trade would also be held in high esteem by his peers for its elegance. After reading what keeps coming out the industry at this moment, going to the forums, working with people in it, I have no doubt that they aren't evil by individuals, but irredeemable in aggregate. Here - Information is power and what not: Annotated guide by the NYT covering the Order Instituting Proceedings. One of the first few links in the Parent article http://www.nytimes.com/interactive/2012/07/10/business/dealbook/20120710-bank-scandal-documents.html http://www.nytimes.com/interactive/2012/07/10/business/dealb...