This CBS report looks at the so-called shadow market, where complex financial instruments are privately traded, with little disclosure and very low levels of transparency. The shadow market contributed directly to the contagion aspect of the crisis as all the deals were done directly between institutions, creating high levels of counterparty risk (and one initiative has been to mandate these transactions to be cleared through a central counter party). Securitisation and derivatives certainly have their place, but when they are based on incorrect models, or misused or abused these modern financial techniques and instruments can be very dangerous.
Steve Kroft looks at some of the arcane Wall Street financial instruments that have magnified the economic crisis.
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Finance Documentaries: http://www.financedocumentaries.com/2011/12/wall-streets-shadow-market.html