Big day for arrests.

First, we have the arrest of the two former Bear Stearns hedge fund managers Ralph Cioffi and Matthew tannin on charges of conspiracy, securities fraud and wire fraud as part of the arrangements that had them allegedly misleading investors.

Apparently, the tell-tale evidence is in some emails. These included some correspondence that had Tannin telling Cioffi that the "subprime market looks pretty damn ugly'' and could be "toast'' and another where Tannin told Cioffi they close the funds immediately if a colleague's projections for the collateralized debt obligation market were "anywhere close'' to accurate. More details from Bloomberg.

The extraordinary part about this is that these two were dumb enough to put it in email. "The two managers simply didn't think it through. There's been plenty in the press about e-discovery. But e-mail has become an innate tool," Denise Valentine, senior analyst at Aite Group told the Wall Street&Technology blog.

Still, these two two might have promising careers ahead of them with TheStreet.com suggesting they follow Merrill Lynch's Henry Blodget into the media as commentators.

Just after Cioffi and Tanni's arrest, the Justice Department has announced that 466 defendants have been charged in 144 mortgage fraud cases. The FBI has also targeted 19 companies, reports Dow Jones.

The mood is ugly. The Bush administration, keen to deflect attention away from an economy and market that's in trouble, wants scalps.