Well, it's true that counter-party risk, is, well, risk. And, I agree that Corzine should be locked up. But, I'm not sure what that has to do with this.
As for rehypothecation, it's a bit better in the States. The UK doesn't even have a notion of a client segregated accounts at all. At least what Corzine did was a crime in the US.
As for derivatives: I hear this sort of anti-derivatives talk a lot. I don't understand it. If you're saying that things should be pushed to central clearing so that people can't mark-to-myth and cook their complex structured products books until they blow up. I'm all in agreement. All that stuff should be centrally cleared, just as vanilla options are. But, to talk of 'derivates' in general doesn't make much sense. If you have a mortgage, that's a derivative. Derivatives are necessary for farmers, oil companies, and the rest of the economy to function.
As for the 'traders', here's my counterexample: There a many, many people who invest in the market in some way. There are also many people who play the lottery. It is common practice to ask people who win the EuroMillions what their system for picking numbers is? I mean, I think Buffet is an amazing guy with an amazing mind - but, we still can't completely discount the chance that his string of big wins was luck. One in a million things happen to 70,000 people every day.
As I alluded to, even if these guys are the 'real deal' (and they, for some reason, want to give away their strategies for TV appearance fees. Which, if they're great traders seems weird because there's a contradiction that they're trading the ability to make all this money for a pittance. Perhaps they're just generous, or like the publicity. Ok, we'll go with that.) The system that they need to predict. Say the universe of publicly traded 'large-enough' companies and other instruments such as FX, that's probably about 1000 symbols globally. The time frame they seem to operate on is something like a year, perhaps a bit less.
Now look at the system that Bernanke and Brown need to be able to predict in order to set monetary/ fiscal policy. You're talking about the entire economy of a country. The market capitalization of the S&P500 is about $10 Trillion and the FTSE 100 is about £1.5Trillion.
Now, I've just done some very quick napkin arithmetic and it looks like earnings for all $1 Trillion a year at the most. The US GDP is about 15 Trillion a year. So The US economy is at least 15 times harder as an absolute lower bound. I guarantee it's worse than that risk and things tend to get all exponential on you in these sorts of cases. Additionally, publicly traded S&P 500 companies are going to be more homogenous than taking the entire economy, public and private equity and debt, inflation, fx, all that stuff.
Also volatility (taking the usual assumptions) increases with time passed as well, so that's another multiplier.
Point is: it's a different game. I'm excellent at predicting where the market is going in the next few minutes. For personal investments, I buy and hold and never pick stocks. I understand that my knowledge on one time frame is swamped by the increased volatility and complexity of dealing with the economy on that time frame.