Whamo, that's an excellent point. Most private transactions take place using SSL (https). I think that this means anything sent between your computer and the server you are connected to is encrypted using RC4 128-bit. Even if the information is intercepted by packetsniffers, it can't be read without decrypting it. I don't care if someone sees that I read elitetrader, but I do care if they get my account numbers and passwords. Can anyone confirm that theory? Is browser level encryption crackable now, or is it still safe/immune to packetsniffers?
In my opinion, most everything can be cracked at some point in time. That's why they keep coming up with stronger encryption. But don't sweat it, you're taking more risk trading than making a secure transaction. The probability that a neighbor is going to crack 128 bit encription to steal your credit card number, of which you'll be liable for ~$50 of it, is minimal.
Firewalls are to prevent intruders into your PC... they do nothing if someone is listening to your data in-transit. As mentioned before, cable systems broadcast the packets to multiple subscribers, it is up to the cable modem to decide what data is for you (send it to your pc) and what data is for someone else (discard it). If someone hacks the cable modem to make it promiscuous (i.e. listen to everyones data) then it doesn't matter what firewalls you have on your pc... your data has been comprimised unless it is going encrypted (SSL) between your PC and the server at the other end. DSL is a 'private path' back to your telco office... at this point, you are trusting the telco (and the rest of the internet path) to not eavesdrop on your data. Having said all that... a technical article at http://www.sans.org/rr/homeoffice/sniffing.php from one year ago talks about the difficulty of 'sniffing packets' on a cable network.