Comments on: $1 Quadrillion of Unregulated Debt At Core of Coming Derivatives Crisis

By: henk korbee

henk korbee — Tue, 30 Sep 2008 06:38:03 +0000

Although I am an EU citizen living in Holland the last few years I read about the ‘Derivative bubble’.(Wish that would exist in math.) An US-friend of mine is helping the homeless somewhere in the USA and two years ago she told me it was bad, the last year she wrote that it was very bad. During the time I know her I also read that the rich were doing quite well. Hence forwards I took the decision that a ‘disaster will happen soon’ and now it will come. Accept the ‘700 billion’ and vote for someone who will clear the situation for the coming decades.

By: Mark

Mark — Mon, 29 Sep 2008 15:23:32 +0000

Has anyone ever thought about how the Governmant is getting away with using our tax dollars to fund takeovers of private institutions. Nowhere in the Constitution does it authorize the Gov. to do what they are doing. However, most of the sheeple just stand by and let them do what they will with OUR MONEY! So as we watch our country crumble into oblivion and all of the criminals get away with murder just remind yourself of this fact, we let it happen and continue to let this happen. Read our Constitution and Bill of Rights and you will see what is going on.

By: asdf

asdf — Sun, 28 Sep 2008 20:46:28 +0000

@Punks: “The problem is that we (the official owners)..”

You (US citizens) are not the owners of ‘your’ money. The owner is the FED.

By: Punks

Punks — Sun, 28 Sep 2008 14:16:44 +0000

It is a biggest identity hijacking in history! Fed Res is using your identity and has access to your credit card and is buying anything it wants. The problem is that we (the official owners) and calling our bank (US govn’t) to report the theft, but are told that not only it isn’t true and it is not happening, and that we are crazy to believe that “non-sense”, but also, they are saying that it is us, who has a false identity and Fed Res is the true self! So now, they gave credence to a thieve knowingly so, because the thefts are the real owners of the bank, those we mistakenly thought that we can trust our assets. Why would they do that, you may wonder, because all the conditions were right for it to happen. the last brick as been laid. It took them over a century to acoumplish this (when Fed Res first was started), but now it is in a full out view. Our assets are being transferred to a biggest criminal organisation in history!

Check your CC statement lately?

Stand up for you future!

Punks.

By: Anne

Anne — Sun, 28 Sep 2008 12:22:44 +0000

Andrew Butter writes:

I always thought that it was illegal to take out insurance on your next-door neighbor’s house in case it burnt down. What CDS’s allowed the banks to do was to write a hundred policies, and now one house in fifty is in danger of burning down, and the guys that wrote a hundred policies on each house are in danger of defaulting. And the way the system is structured that could set of a domino meltdown of CDS’s,

http://www.marketoracle.co.uk/Article6495.html

By: Paulson is an idiot

Paulson is an idiot — Sun, 28 Sep 2008 08:12:24 +0000

Do Logic, what do you mean by “unwound”?

Everybody and their grandmother on Wall Street is INSURED against LOSSES. So if a bank fails, or a stock goes down or whatever, there is probably a DERIVATIVE to “cover” it.

What’s “funny” is that even the financial institutions which create these derivatives contracts are “insured” by other derivatives contracts.

In other words, its like a poker player who insures himself against losses by purchasing derivatives contracts offered by another gambler he is PLAYING against. Each gambler insures the other against losses! And they have been calling this GDP(!!!) for 20 years!!!

Its a ZERO sum game. Its FICTIONAL. The WHOLE THING was fictional for 30+ years! The ratings agencies were PAID to provide strong ratings, and they were OWNED by the very companies they were rating!!!

Purchasing the derivative is cheap, but PAYING the derivative (as AIG found out) is orders of MAGNITUDE more expensive.

By: Do Logic

Do Logic — Sun, 28 Sep 2008 07:23:59 +0000

Alex,

I understand that the NOTATIONAL value given the global derivatives market by BIS earlier this year was 1.14 quadrillion, about half of which falls within some regulatory regime and about half which does not. I also understand that if these were unwound the total loss would be a single digit trillion. The larger figures the writer and you, where did these come from? The BIS figure is not to be taken at face value (I couldn’t resist). I know what the BIS is as do you, why should we believe what they say? Could this number be nothing more than a “spell” cast upon the mind of the masses to stun us into immobility?

By: Paulson is an idiot

Paulson is an idiot — Sun, 28 Sep 2008 07:06:43 +0000

You know what this is?

This is basically a matter that is often heard in sports.

This is a matter of WHO WANTS IT MORE.

The one who WANTS it more will win this thing. Do the billionaires and millionaires on Wall Street WANT IT MORE, or do the American people WANT IT MORE?

This is our opportunity to take our country back from the clutches of the fascist cabal.

The government can create credit. The Fed does not want us to create credit.

So I ask again. WHO WANTS IT MORE???

By: rich

rich — Sun, 28 Sep 2008 02:40:34 +0000

that’s an astonishing figure, surely the house of cards is falling !!!!!!!!!!!!!

http://www.youtube.com/watch?v=Vma8wnb6UmI

By: Alex

Alex — Sat, 27 Sep 2008 19:49:38 +0000

The amount of derivatives at risk is actually closer to $1.5 quadrillion. Many of those contracts however are hedged – or offsetting, however they are so highly leveraged that tiny moves in the basis translate to gigantic moves in the contract yields or losses.

I think that if all of them were just wiped off the books it would probably tranlate to a loss of about $5 Trillion or so.

The real reason for this bailout is not toxic mortgages, thats small potatoes and easily written off. even Bush admitted that the vast majority of mortgages are good. The banksters want their derivatives bailed out. That’s the REAL money. Ther mortgages might be painful to write off but they are not bank killers. Derivatives collapsing onto a singlarity can and will destroy the fortunes of the elite, even the old time money.