You so STU-PIIIIIIIIID!

Other shoes keep dropping as the credit crisis unfolds, but this one is really impressive:

Beginning in 1999, the Turnpike Authority entered into complex arrangements - known as credit swaps - with three investment banks as a means of raising cash to pay off rising Big Dig debt. Essentially, the banks paid the Turnpike Authority cash for the right to swap interest rates with the agency on future debt payments. The deals, while immediately raising $71.5 million in cash for the agency, left it vulnerable to fluctuations in interest rates.

So the Turnpike insured banks against interest rate changes?  Why would they do something like that?  They have no counter hedge.  Perhaps the Turnpike Authority has a death wish - an insatiable appetite for risk that can only be filled by taking outsized bets on global financial conditions.  (Or, as Bostonians might speculate, perhaps the Turnpike Authority is run by morons.) 

Wait...I've heard this before...the choice of a known quantity or some unknown that might be better, but maybe not...why does this seem familiar?  Oh yes!

Kuni: Ahhh, red snapper. Mmmmm, very tasty. Okay, Weaver, listen carefully. You can hold on to your red snapper...[Hiro-San emerges, carrying a table with a box]...or you can go for what's in the box that Hiro-San is bringing down the aisle right now!!! What's it gonna be? [Phyllis Weaver decides between the Red Snapper and the box. The audience points to the box]

Phyllis Weaver: I'll take the box. The box! [the audience applauds]

Kuni: You took the box! Let's see what's in the box! [Hiro-san opens the box, and the audience gasps: the box is completely empty!] Nothing! Absolutely nothing! STUPID! You so STU-PIIIIIIIIIIID!