So basically our economic policy should be "let's practice capitalism, until someone screws up, and then we get the government involved." All this sort of thing does is create more reasons for the government to bail out other bad investors. We already have talk of bailing out the banks that chose to lend money to people they knew would not pay it back. Why stop there? Let's just have a command economy and be done with it.
That’s not what I said at all. There is a reason banks and investment companies are so highly regulated. Its because they are key to our financial system. Would you be willing to suffer through a prolonged depression to avoid having the Fed getting involved in a failing institution?