ANSWERS: 2
  • I absolutely agree. I didn't know much about credit default swaps until last week. Now I am terrified. The market is between $$50-70 Trillion - I mean, they can't even figure the number within $20 Trillion? Yikes! When that domino falls, I think it will squish a whole lot of people who didn't even know it was there. Here are some great videos on credit default swaps if anyone is interested in learning more about these 'financial weapons of mass destruction'.
  • People borrowing money that they had no capacity to repay is at the base of the problem. CDS's are terrible but they wouldn't have been invented if the underlying loans had been sound. And it is a credit crunch-what do you want to call it, Ralph? The equity infustion that the U.S. government put into banks is being sat on, not lent-causing an additional $3.25 Trillion liquidity squeeze.

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