Bill Taylor on why it's going to end badly, again.

At one point, Rose asked the question that scholars, pundits, and plaintiffs attorneys will be debating for years: “Should wise people have known better?” Of course they should have, Buffet replied, but there’s a “natural progression” to how good new ideas go badly wrong. He called this progression the “three Is.” First come the innovators, who see opportunities that others don’t and champion new ideas that create genuine value. Then come the imitators, who copy what the innovators have done. Sometimes they improve on the original idea, often they tarnish it. Last come the idiots, whose avarice undermines the very innovations they are trying to exploit.

The problem, in other words, isn’t with innovation itself — it’s with the imitation and idiocy that follow. “People don’t get smarter about things as basic as greed,” Warren Buffett warned Charlie Rose.