The Masters of the Universe on Wall Street treated the American economy like their own personal casino. And when they lost it all, they leaned on the American people like a gambling addict leaning on his soft-hearted kid brother—because face it, Johnny, “if the Mob breaks my fingers it’ll bust our poor old Ma’s heart.” (In this analogy, “Ma” represents the economic stability of the entire planet.)
If you want an overview of the financial crisis explained in everyday language the average person can understand, and served up with a healthy portion of humor—if you want some solutions to how we can get out of the mess the Wizards of Wall Street got us into—KCLabor.org  urges you to check out Les Leopold ‘s new book, The Looting of America: How Wall Street’s Game of Fantasy Finance Destroyed Our Jobs, Pensions, and Prosperity—and What We Can Do About It .
From their review:
If you want to know why it was necessary to give over a trillion dollars to big banks and insurance companies over the last year Les Leopold’s new book is for you. Carrying on the tradition of the Labor Institute he helped found and now directs, Leopold manages to explain the most complex shenanigans of finance capital in language the average worker can understand. To keep us going off the deep end in to despair he sheathes the sharpest edges with some humor. He even closes with some suggestions of what to do.
The reader finds out about derivatives; collateralized debt obligations, including their squared and cubed variations; credit default swaps; and, most inventive of all, synthetic collateralized debt obligations. You’ll also be equipped to impress the counterman on your next trip to the deli by instructing him to tranche your corned beef thin and extra lean. If, like me, you at first find yourself having trouble keeping these byzantine terms straight you can bookmark a handy glossary included by the author in the back.
It wasn’t intended that even mere stock brokers or politicians, much less workers, would ever understand this strange new lexicon, with its underlying definitions of finance. The author quotes former Senator Phil Gramm (of Gramm-Rudman fame) “politicians don’t know a credit default swap from a turnip.” This is the brave new world of “fantasy finance,” exceedingly complicated, not possible before powerful computers started appearing on bank desktops.
But once those PCs arrived, and the old firewall between investment and savings banks was scrapped, thousands of creative hustlers at banks big and small started designing new custom-made over-the-counter securities for customers eager to get more bang for their buck. Leopold explains how early perceived successes in this completely unregulated arena ultimately led to their handling of trillions of dollars–mostly other people’s dollars–like they were playing Fantasy Baseball.
There were a few sticks-in-the-mud who warned early on, even fifteen years ago, the potential for disaster and urged regulation. They were dressed down not only by Greenspan and Bernanke but Obama’s financial gurus as well–Volcker, Rubin, Summers, Geithner. All are free marketeers who likely review a few pages from Milton Friedman before going to bed every night.
If the gambling casinos had been risk takers on a par with the financial casino Las Vegas and Atlantic City would have become ghost towns long ago. With no one–not even the vaunted credit risk evaluators such as Moody’s and Standard & Poors–telling the bankers about their evolving nudity they lost their shirts and got caught with their pants down when the housing bubble burst. Their delicately layered tranches–“insured” by those turnip-like credit default swaps– forced them to coin yet a new term–toxic asset. The U.S. meltdown also had ramifications throughout the world, even bringing down the government of Iceland.