David,regarding the yellow boxes...when you talk about the banks not worrying about the risk...I have to wonder why they didn't worry?
Re: your comment on "the story is probably an old one." I think this speaks to the heart of the problem. The government is planning another round of the same process you describe here, but the legislation(regulation) is what is driving it again. Stealing other peoples' money through involuntary, coercive law is the oldest trick in the book. Using the governments coercive power of force is the easiest way to get your hands on big money, not worry about risk and leverage it for a larger return than normal. Read up on the Austrian's Boom/Bust Business Cycle theory and you can learn more about how people loot others using the government.