I mostly lost patience with the Big Dog a long time ago, but this kind of honesty is refreshing:
“On derivatives, yeah I think they (Rubin and Summers) were wrong and I think I was wrong to take [their advice] because the argument on derivatives was that these things are expensive and sophisticated and only a handful of investors will buy them and they don’t need any extra protection, and any extra transparency. The money they’re putting up guarantees them transparency,” Clinton told me.
“And the flaw in that argument,” Clinton added, “was that first of all sometimes people with a lot of money make stupid decisions and make it without transparency.”[….]
Clinton said he regretted not trying to regulate derivatives, but that Republicans would have stood in the way. “Now, I think if I had tried to regulate them because the Republicans were the majority in the Congress, they would have stopped it. But I wish I should have been caught trying. I mean, that was a mistake I made.”
I’m not a Summers-hater or a Rubin-hater. But there should be a consensus that they screwed the pooch on CDO regulation.