deMolay wrote:I think this one is going to end badly. http://www.marketwatch.com/news/story/7 ... aspx?guid={024DB809-8506-4AA9-83BB-B053FD4E1C11}&dist=TNMostRead&print=true&dist=printMidSection
vision-master wrote:What ya smoken, nothing in this article about credit cards.
SeaGypsy wrote:vision-master wrote:What ya smoken, nothing in this article about credit cards.
Who is it that 'owns' the bulk of derivative contracts VM?
When banks are unable to balance the books it's only a matter of time before they dishonor credit. I imagine the consumer would be at the blunt end of the contraction in this case. Why else would all of the airlines (who are of course from all over the world) refuse to take European cards? Maybe it's Europe versus the USA for who can hold out the longest in a truth fast?
threadbear wrote:This is, by far, the biggest part of the meltdown story and it is getting very little attention because people don't understand the derivatives, credit default swap market.
Try this link:
http://www.democraticunderground.com/di ... =114x59460
Here is another really helpful link by a woman who studied this issue, on her own, for 3 years. She has described the gambling in a way we can understand.
Derivatives for Dummies--"Dandelion Salad" blog
"Imagine being able to insure a car that you don’t own or use. Imagine it’s the car your neighbors will let their teenage son drive, when he gets his license in a few weeks — and you know the kid is a reckless brat.
Now imagine that, by using financial derivatives called swaps, you can purchase as many insurance policies on this car as you can afford to pay premiums on.
When that car is eventually trashed and scrapped, you — and any friends you clued in on the deal - might collect millions, even billions, of dollars. By contrast, your neighbors, who bought real insurance on a real vehicle, get only its Blue Book value (and, one hopes, a chastened child)"
http://dandelionsalad.wordpress.com/200 ... ne-harris/
very scary, indeed. This is the fatal flaw that could have capitalist countries failing just like their communist counterparts, in the late eighties.
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