2. the speculative excess had very little to do with the particular form of debt
what, you think bubbles didn't exist before structured financial products?
people were making bad loans. sometimes bad loans default. people who hold the debt took that risk and pay the price. not so complex after all.
if anything, structured products make it easier to shift particular risks to people who are better equipped and more interested in taking those particular risks. it's not the financial product that's the problem, it's the investor taking inappropriate risks and/or not properly hedging that's the problem.
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