Commentator Amelia Tyagi
Commentator Amelia Tyagi - 
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Tess Vigeland: As we continue our coverage of fallout from the financial crisis, an update on the Lehman Brothers bankruptcy. Today a judge approved the sale of its asset management unit Newburger Burman. The price tag -- $922 million. And who's buying? Newburger Burman's employees. The Lehman bankruptcy in September is widely seen as a watershed moment: how could it be that a century-old Wall Street stalwart goes belly-up? And you hear echoes of that question throughout this crisis. How did all of this get so out of control? How did banks allow people with poor credit to get large mortgages? How on earth did we get to this point? According to commentator Amelia Tyagi, it's time to regulate finances at least as strictly as we regulate toys.

Amelia Tyagi: Global mega banks are trading options and derivatives at lightening speed, and yet we're still regulating consumer finance like it's 1699. Nearly all of our consumer safety laws are founded on the notion that citizens should be protected from dangerous products; no one can sell you an Aspirin with a one in six chance of containing arsenic; you can't buy a riding lawnmower with a one in six chance of blowing up the moment you turn it on. But you can buy a mortgage that has a one in six chance of leading you into foreclosure and leaving out on the street -- and that's assuming you use the product exactly as designed, with no changes in your income.

Why the difference? Because the legal system treats financial products as contracts rather than products. The laws of consumer finance are basically the same as they were in the 1600s, built on the assumption that two equal parties are haggling away, coming to an agreement, which the law should enforce. The law assumes that the average Joe is on the same footing as a trillion-dollar bank, and can simply bargain over double-cycle billing or the arbitration clause. Of course, this is absurd.

The solution is simple: it's time to give home mortgages, car loans and other financial products the same safety provisions we afford a tube of lipstick. A financial product safety commission could review products to ensure that they work, without any hidden dangers or unreasonable tricks. Companies would be held to a set or reasonable standards designed for the modern era. Consumers would have more confidence in the financial products. In time, we would see a drop in foreclosures and bankruptcies and take a major step towards avoiding another global financial meltdown. Or we could keep regulating like it's 1699, and the next time your blood pressure goes up because you have a problem on your credit card, you can just send a messenger to your barber/surgeon asking him to ride over on his horse and buggy to put some leaches on your arm.

Tess Vigeland: Amelia Tyagi is cofounder and chief operating officer of Business Talent Group.