The simple explanation for this is that the market is an emotional place. As Princeton psychologist Daniel Kahneman told Jason Zweig in the book Your Money & Your Brain, "Financial decision-making is not necessarily about making money. It's also about intangible motives like avoiding regret or achieving pride." So ask yourself, "WHY DO YOU TRADE?"
Read the following link for an explanation of CDO's and the subprime mortgage mess. Bad loans are still bad loans. To paraphrase Bershire vice chairman Charlie Munger, "If you mix m&m's with turds you still have turds."
http://wcam.com/files/Feb08_NL_Web.pdf
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