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The best protection is a working regulatory institution.
While bush was in office, he installed more than 100 top officials who were once lobbyists, attorneys or spokespeople for the industries they oversee, which is a bit like assigning the fox to guard the hen house.
To add fuel to the fire, the SEC was filled with men of such unfathomable incompetence, they did not notice Bernard Madoff's Ponzi scheme after receiving detailed reports for nearly 10 years outlining ever detail of illegal activity.
Then, Bush decided to remove the Uptick Rule, which made it possible for speculators and the arbitrageurs (remember them?) to literally send a company into bankruptcy using the open market, or at the very least, scare the hell out of everyone by causing the stock price to drop just a few pennies above zero.
Starting to get the picture of what's going on here?
Wait, there's more:
In 1999, Bill Clinton Signed into law the Gramm-Leach-Bliley Act, allowing mega corporations, wielding ungodly sums of money, to merge together and begin speculating in the derivatives and OTC market. It also made the now famous credit default swaps legally impossible to regulate.
Adding to the volatility of the market, oil prices were soaring to never before imagined heights, due mostly to the speculative activities of institutions fomenting higher prices with their 10s of billions of capital and low margin requirements:
world consumption of oil at 87 million bpd was far exceeded by the "paper market" for oil, which equals about 1.36 billion bpd, or more than 15 times the actual market demand.
A study of the oil market by Masters Capital Management was released which claimed that speculation did significantly impact the market. The study stated that over $60 billion was invested in oil during the first 6 months of 2008, helping drive the price per barrel from $95 to $147 per barrel, and that by the beginning of September, $39 billion had been withdrawn by speculators, causing prices to fall.
And that's not even the half of it, but the rest, as they say, is history.
Here we are, slumped over, bailing out the very institutions that caused this mess