Roubini Says SIVs Should Have Been Forbidden

Roubini suggests that SIVs, or structured investment vehicles, should have been forbidden from the outset.  He suggests that they are Enron style special purpose entities which performed off balance sheet transactions and did not have to abide by any regulations or capital requirements.  Banks would fund the SIV's with very short dated asset backed commercial paper which would need to be rolled over very frequently at unknown rates.  SIV's banking regulators were asleep at the wheel and should have never allowed these SIVs to get so large.