What a waste…
“The damage caused by credit default swaps goes beyond the issue of moral hazard and its effect on the cost of borrowed money. This market also ties up hundreds of billions of dollars of the world’s capital — capital that could otherwise be used to actually finance real businesses that could create wealth and jobs and new products and services. It also represents a massive waste and misallocation of some of the world’s brightest, most skilled workers who are lured in part by the outsize salaries and bonuses that the imperfectly-competitive financial markets now offer. Imagine how much more vibrant and innovative the economy might be if all those Wall Street ‘rocket scientists’ were actually designing rockets and all those hedge fund traders were channeling their entrepreneurial risk-taking into starting new companies.” Steven Pearlstein in The Washington Post.