It has long been obvious that the modern financial industry floats high above us normal folk, untethered by the laws of economic theory or mathematics. How else to explain that as defaults, foreclosure and bankruptcies have skyrocketed over the past decade, so have banking profits? In other words, the faster...

Ben Bernanke's Friday surprise temporarily lifted markets around the globe, but it also fueled speculation that a major American lender was on the brink of becoming the next Enron. Months after New Century's failure, the subprime mortgage crisis has unquestionably "infected" major financial institutions, from Countrywide, to Kohlberg Kravis Roberts...