Gretchen Morgenson writes in the NYTimes that GM “simply used other funds held by the Treasury to pay off its original loan.

The Securities and Exchange Commission, virtually moribund for the last decade while giant vampire squids looted local, state and union pension funds and misled investors, has finally chosen to take on Goldman Sachs for conning everyone. Who knew?

“ISOLATED and imperial chief executives who shun contact with the great unwashed — shareholders who actually own the companies — are a distressingly resilient breed. [...]“

NYT’s Gretchen Morgenson unravels the complexity and self-interest embedded in recent mortgage modification legislation.

EVERY once in a while, if only for sanity’s sake, it is wise to leave our bankrupt era behind and seek out a bit of wisdom from a moral authority. It’s a challenging exercise, given that so many formerly stellar reputations are now shipwrecked and that all those once-smart guys and gals have been reduced to bull-market geniuses.

Morgenson talks to Terry Gross about strategies the government might employ to value the assets taxpayers are buying from endangered institutions — and how regulators might earn back some of the trust they’ve lost in recent weeks.

WE return this week to the subject of the American International Group, the giant insurer that has received $170 billion in taxpayer guarantees, because the clamor over its rescue continues to grow. Of concern to those on both Capitol Hill and Main Street is the secrecy surrounding the $50 billion funneled to A.I.G.’s counterparties since it nearly collapsed last fall.

“DERIVATIVES are dangerous.”

That simple sentence, written by Warren Buffett, begins an enlightening discussion in Berkshire Hathaway’s most recent annual report. Mr. Buffett’s views on derivatives, gleaned from his own unhappy encounters with them, should be required reading for all United States taxpayers.

Why? Because we own almost 80 percent of the American International Group, the giant insurer whose collapse was a direct result of derivatives it sold during the late, great credit boom.

WE are all learning, to our deep distress, how the perpetual pursuit of profits drove so many of the bad decisions that financial institutions made during the mortgage mania.

But while investors tally the losses that were generated by loose lending so far, the impact of another lax practice is only beginning to be seen. That is the big banks’ minimalist approach to meeting legal requirements — bookkeeping matters, really — when pooling thousands of loans into securitization trusts.

““This is your biggest, hugest expense — your home — and when you ask for a life-of-loan history your servicer tells you to get lost,” she said. “And when you ask for a list of charges in the loan history that’s not going to happen.”

So even if loan modifications were to rise rapidly, it is unclear that borrowers can trust what lenders tell them about what they owe.”