One of life’s rules is that there’s bad in good and good in bad. The total collapse of the US financial system is no exception. Even in the midst of the current financial despair we can look around and identify many collateral benefits.

A lot of attractive office space seems to be opening up in midtown Manhattan, for instance, and the US government is now getting paid to borrow money. And so as Morgan Stanley chief executive John Mack blasts short-sellers for his problems, and Goldman Sachs Group Inc. CEO Lloyd Blankfein swans around pretending to be above this little panic, we ought to step back and enjoy the positives.

To wit:

1) We finally get to see what’s inside these big Wall Street firms. We’ve just witnessed the largest bankruptcy in US history and we know neither the inciting incident, nor the deep cause. But there’s now a pile of assets and liabilities smouldering in New York awaiting inspection.

We may well find out that Lehman Brothers Holdings Inc., in liquidation, has a negative value of hundreds of billions of dollars. In that case the natural question will be: How much better could things be inside Morgan Stanley and Goldman Sachs, both of which were in the same line of business?

2) We are creating the financial leaders of tomorrow.

Remember when everyone believed in Alan Greenspan? He’s left not only a mess but a void. No matter how well-educated we become in our financial affairs, we still need public officials to look up to.

And there’s nothing like a government bailout to create new public sector heroes. Hank Paulson, 62, is probably too old; in any case, he’s tarred by his association with George Bush and Goldman Sachs. But 47-year-old Tim Geithner at the New York Fed is perfectly positioned to make Americans feel as if their financial system is in good hands.

Whatever happens to the US financial system, someone is bound to get the credit for something even worse not happening and, as no one really understands what Geithner does, he’s the obvious choice.

3) Ordinary Americans get a lesson in low finance.

It’s been expensive but, then, so is kindergarten.

Our willingness to believe that we can hire some expert to tell us how to outperform markets is a big problem, with big consequences. It underpins Wall Street’s brokerage operations, for instance, and leads to a lot more people giving out financial advice than should be giving out financial advice.

Thanks to the current panic, many Americans have learnt that the experts who advise them what to do with their savings are, at best, fools. Those people will now think twice before they listen to their brokers ever again.

4) We have lots of new houses.

Not all of them have people in them, sadly, but that’s a minor detail. Even better, no one has had to pay for them, and probably never will. I’m betting that the US government will soon have no choice but to take the final step and guarantee every bad mortgage loan ever made by Wall Street.

5) Huge numbers of Wall Street executives will have the time to raise their children.

Wall Street has been far too lucrative for a certain kind of energetic and ambitious person to justify anything but the most perfunctory personal life. Now that the market for his services has collapsed, he has time to go home and figure out which of the children roaming around the mansion are actually his. In time, he will learn to love them and they him, and they will gain the benefit of his wisdom and experience. Perhaps one day they will put it to use as traders and investment bankers, on the Wall Street of the future. There, slowly, they can earn the money they would need to pay off the mortgages defaulted upon by their forebears. Bloomberg

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