there will be a ton of paper written on the current crisis. but this para
below is the msot sacry:
http://mrzine.monthlyreview.org/labotz240908p.html
'The mortgage paper, however, formed only one wing of a much larger house of
cards that had arisen in the last couple of decades as financiers created new,
almost entirely unregulated instruments called derivatives. While derivatives
such as such options and futures (gambling on the future value of a stock or a
commodity) have been part of the capitalist financial system virtually since
its inception, other derivatives, such as credit default swaps, were more
recent creations. Essentially a form of insurance against the failure of an
investment arrived at by private contract and unregulated by the government,
swaps were an attempt to hedge against the very nature of competitive
capitalism. These swaps now amount to more than $60 trillion.'
the 60 number is huge and must involve assets and liabilities!
back in the eighties the Basel agreement curtailed japanese banking adventures
abroad. but when the cds's came through, the sky was the limit.
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