Chrs Devrs Tumblg How many social networking sites do we need, anyway?

Say I’m a sausage grinder. My sausage is selling great.  Until one day, my customers say they don’t want the ends, the ones with those nasty knots.

Pretty soon, I’ve got all these end bits piling up on my counter. I’m worried it’s going to turn off customers.

So I shove the end bits back in the grinder and make new sausages.  Brilliant. Of course, customers don’t want those end bits either.  So, I throw them back in the grinder.

This works for a while.  But eventually, I’m making sausages that are made up entirely of nasty end bits.

“So, this is exactly what happens with subprime CDOs,” Bernstein says. “The investment banks take the worst parts of the CDO and they put it into new CDOs, recycling it again and again, until pretty soon, the CDOs that you’re left with are made up of the worst parts of the stuff.”