I agree with you that the regulators are to blame, but wall street (regulators, ratings agencies, banks, funds) seem to consistently break the law with no consequence. All of these are largely responsible for the deregulation that allowed these financial instruments to become legal. We need consequences or this system will remain broken, I think. Fraud is a crime that many lower class people consistently go to prison for. It's times like these that I personally realize that MLK was right when he said the system we have in place is not justice, it makes a mockery of justice. These people/institutions continue to get richer without repercussions, and ready to benefit during the recovery from every crash meanwhile poor people get shafted.