Tons of bloggers have posted these two segments from 60 minutes. The plain talk explanations are worth reposting.

The first talks about how Dr. Michael Burry got richer on Credit Default Swaps of CDOs…and AIG jumped in on the CDS party at the behest of Goldman Sachs.
Lewis maintains its stupidity, more than corruption. I am not so sure of that. Government regulation should be used to make sure markets properly penalize the stupid and the corrupt.

Lewis explains things very well, but he is no raging populist. “You Should stop and say this shouldn’t be done” – Michael Lewis on the Wall Street Banks who bought CDS from AIG on overrated CDOs filled with junk mortgages that were bought with funds levered 20, 30 or 40 to 1. He still assumes some sort of conscience can push through group think and convince people that they should somehow blow up a system that pays them 10s of millions in bonuses just for showing up.