OMG: $707 TRILLION in Derivative Contracts?

[expat_panama]

Another problem with all this CDS and MBS nonsense...the brokers take their fees up-front and sell the risk down the road, i.e. the guys (or gals) creating all this risk are not the ones who will get burned if it all goes bad. De-coupling risk from gain is a very, very bad thing...

There is a loss as always happens when things change. 50 years ago the farmer would get a mortgage from the man at the savings'n'loan and then make payments to the same man and everyone knew everything. Now the local tech start-up floats a loan and the paper's sold to some clown in China who's piling it on to 300 others. Nobody knows nothin', except the average US household wealth adjusted for inflation is double what it was 50 years ago. Repeat; today's families are twice as rich as our grandparents were.

Sure, the crybabies will whine about the big hit we just took, that we're 20% down from the '07 peak and we're back down to where we were in '03. We're still double what we were in '61.

Expat, I just have to say, you can't start out by saying that you're going to show us how CDS's can work in the real world and then present a scenario where a million dollar loan is left with just $1 remaining on it. Come on...

LOL! I get that all the time, it's how the world works being made up of those of us who work for a living and them that complain, criticize, and live with their mothers. Some of us are those that do, and others are those that gripe. Let me know when you want to offer a better example.

 

[JimBowie1958]

Another problem with all this CDS and MBS nonsense...the brokers take their fees up-front and sell the risk down the road, i.e. the guys (or gals) creating all this risk are not the ones who will get burned if it all goes bad. De-coupling risk from gain is a very, very bad thing...

There is a loss as always happens when things change. 50 years ago the farmer would get a mortgage from the man at the savings'n'loan and then make payments to the same man and everyone knew everything. Now the local tech start-up floats a loan and the paper's sold to some clown in China who's piling it on to 300 others.

So there is no responsibility for making bad loans in the market because those bad loans can always be passed on to suckers in China? No, dude, because when all those bad loans happen and all the credit given for those loans is destroyed, it reduces available credit for business start ups and expansions globally.

Nobody knows nothin', except the average US household wealth adjusted for inflation is double what it was 50 years ago.

There are plenty of people that know what is going on quite well and have a verifiable record on calling these things. You act like no one ever does, which is bullshit.

Repeat; today's families are twice as rich as our grandparents were.

Yeah, but are young adults today richer than the parents were twenty years ago? no.

And when we fall below the standard of living for our grandparents, I guess you'll start comparing things today with how our great-great-grandparents lived? How far back we you go for comparisons?

Sure, the crybabies ....

Only to you Polyanas. The rest of the world calls it 'Realism'.

will whine about the big hit we just took, that we're 20% down from the '07 peak and we're back down to where we were in '03. We're still double what we were in '61.

So the destruction of eight years of wealth accumulation is OK because we are better off than we were FIFTY YEARS AGO? lolololololol

Expat, I just have to say, you can't start out by saying that you're going to show us how CDS's can work in the real world and then present a scenario where a million dollar loan is left with just $1 remaining on it. Come on...

LOL! I get that all the time, it's how the world works being made up of those of us who work for a living and them that complain, criticize, and live with their mothers. Some of us are those that do, and others are those that gripe. Let me know when you want to offer a better example.

Let me know when you decide to accept reality and stop claiming to be some kind of authority because you no longer live with your mom.

 

[expat_panama]

...the paper's sold to some clown in China who's piling it on to 300 others...

So there is no responsibility for making bad loans in the market because those bad loans can always be passed on to suckers in China? No, dude, because when all those bad loans happen and all the credit given for those loans is destroyed, it reduces available credit for business start ups and expansions globally...

NO RESPONSIBILITY --WE'RE DOOMED!!! OK, before we call for Captain Hyperbole lets get a grip and return to the Planet Earth. In real life 98 1/2% of loans are being paid back and 94% are completely on time with great credit.

...Only to you Polyanas...

Good to know we're dropping economics to start talking about me because economics is settled. Welp, the only thing I can add about me is that I find talking about me boring.

Cheers.

 

[editec]

Jim and EXpat.

You might both benefit from a perusal of this.

http://www.newyorkfed.org/research/staff_reports/sr458.pdf

TORO is another player here whose input on this report would greatly interest me.

Boys I think we're really all on the same side here.

WE all want to get at the TRUTH.

 

[JimBowie1958]

...the paper's sold to some clown in China who's piling it on to 300 others...

So there is no responsibility for making bad loans in the market because those bad loans can always be passed on to suckers in China? No, dude, because when all those bad loans happen and all the credit given for those loans is destroyed, it reduces available credit for business start ups and expansions globally...

NO RESPONSIBILITY --WE'RE DOOMED!!! OK, before we call for Captain Hyperbole lets get a grip and return to the Planet Earth. In real life 98 1/2% of loans are being paid back and 94% are completely on time with great credit.

...Only to you Polyanas...

Good to know we're dropping economics to start talking about me because economics is settled. Welp, the only thing I can add about me is that I find talking about me boring.

Cheers.

Ridicule and sarcasm are all you got, troll, and you are wasting my time no more.