Credit Default Swaps! The trillion dollar shell game! They are secret, of unknown magnitude, and do not require any reserves to back them up! Totally unregulated because, we were told, because the huge financial institutions that would swap them and sell them and make huge profits off of them had brilliant people who wouldn't let anything bad happen.
These insane instruments allow many people, not directly involved, to buy and sell insurance all riding on whether or not some huge financial giant will default. It took a trillion dollars in liabilities and had them insured for nearly 60 trillion dollars. So when the first domino (default) happened, when a money market broke the buck, trillions came due and nobody could pay up and the dominoes all fell.
Now one of the engineers of this situation, Paulson, snookers us into an emergency bailout of $700 billion to help shield some of these speculators from the bitter fruit of their greed! And our idiot representatives in Congress with a few exceptions voted for this shell game bail out WHICH WILL NOT WORK!