The CDS growth was marked by a back-office breakdown: Unsigned confirmations proliferated and general confusion reigned over who owed what or even how many CDS had been written. Timothy Geithner, then president of the New York Federal Reserve, and one of his predecessors, Gerald Corrigan, attacked this disorder in 2005, leading a drive that has greatly improved the infrastructure of CDS the plumbing, so to speak, that connects one derivatives party with another. Corrigan, a top Goldman Sachs executive since he left the Fed, is proud of the progress that, has been made, advances that have been compared by others to taming the Wild West. Without these process improvements, Corrigan recently told Fortune, what happened over the past couple of years could have been “much worse.”

That’s a head-snapper for sure, considering that despite this progress we suffered a disaster so cosmic that it crushed the economy and brought down an appalling collection of famed U.S. financial companies. Consider the main wreckage of 2008: Bear Stearns, bought by J.P. Morgan Chase; Fannie Mae and Freddie Mac, taken over by the U.S., the parent that didn’t want them; Merrill Lynch, bought by Bank of America; Lehman, gone bankrupt; AIG, rescued by the U.S.; Wachovia, bought by Wells Fargo.

It was the earliest casualty of these, Bear, that brought a new concept—“too interconnected to fail”—to the forefront. Going in, the government really did not want to save the company. Robert Steel, a ranking member of Henry “Hank” Paulson’s U.S.