[energyfight]

Can someone explain what the heck an CDS is?

It sounds like the same type of financial instrument used for subprime mortgages, the "securitization" part, was applied to other parts of the US economy. This includes corp debt, insurance risk, municipal debts, state and fed debt - and all the other hidden debts that needs to be hidden in order to maintain a happy go lucky feeling.

It just seams that the credit market was busy using these instruments to keep growth going... and then PO came along and screwed up everything.

Anyway it looks like the US abused the heck out of beatifying bad loans, and if we can't maintain economic growth, that this pause in the economy, caused by PO, will take the entire system down.

I do not see much blame placed on PO for the credit crises, but if energy was cheap forever, world liquidity could continue forever, and everything would have been just peachy. And we could have shuffled bad debt to the "markets"...

But at this stage, it looks like every gimmick or financial instrument invented by US financial folks never considered anything but growth. Nobody was ever thinking about contraction or a pause.

Just seams to me like we are totally screwed.

[Jack]

LINK

A quick & dirty intro.