Tell that to the comp and benefits analyst who lost his job when Bear Stearns blew up. Tell that to the facilities manager at Lehman- who not only lost her job, but lost most of her retirement. Oh, and the value of her home plunged by 20% in November 2008 because so many people in her town in NJ were employed by Bear Stearns or Lehman.
The conceptual backing is well and good. Reality on the ground is that somewhere there are products lurking which are NOT valued appropriately given the risk, and a buyer somewhere who is NOT savvy enough to know what is being sold, and a group of lawyers who prepared the documentation who up until last week were working on the M&A team, not the Structured Finance team, but since M&A is slow and Securitization is heating up, they got transferred temporarily.
Too big to fail.