Milken's big week

The onetime junk bond king - he'll forever wear that label - hosts his annual global conference this week in Bev Hills, where the usual impressive lineup of financial and political superstars get to lay out their view of the world. This time out, there's a bit more buzz about Milken himself - specifically, whether the current subprime/credit mess can at all be compared to the days of high-risk, high-yield junk that helped revolutionize the way companies get financed. Milken says that people who connect then and now "don't understand markets very well," which is the sort of thing you would expect him to say. The problem, he says, is not securitization (that's when debt gets sliced up and repackaged). The problem is the way securitization has been abused. From the NYT's Andrew Ross Sorkin:

Blaming Mr. Milken for today’s credit crisis is like blaming the inventor of paper money. He may have made some mistakes along the way, but Mr. Milken helped create a new generation of companies and an entirely new way to finance nascent ideas that have helped fuel the global economy far beyond his exit from Drexel. The list of companies that would not exist without him is long: MCI, CNN and Turner Broadcasting (now part of Time Warner), Barnes & Noble and Occidental Petroleum, just to name a few. Toward the end of every bubble, people misuse the financial tools at their disposal, and then a witch hunt begins for the villain. Then, of course, the regulators jump in and try to fix things — and often go a bit overboard.

Milken is worried - and for good reason - that excessive regulation will cause more problems by quashing competition. By the way, Milken says he's optimistic that the worst of the market carnage is probably over.