The real tiger in the woods causing the 2008 financial meltdown, wasn't the mortgage fiasco, but rather it triggered a HUGE problem with the derivative trades on the books. We could discuss that, but I want to bring to your attention that issue has NOT been corrected. and needs to be. Prior to end of 2000 derivative trading was regulated by gaming laws. That in itself should raise eyebrows. At the end of 1999, a law, supported by both repubs and dem president lifted those loose regs. Therefore, allowing the sharks to swim with minnows. Though both are vital to the financial eco system, bad idea. Buffett quickly referred to derivatives as " financial weapons of mass destruction ". Boy was he right, hence the meltdown.
Just 3-5 years or so ago Jamie Dimon fired the most highly heralded female exec in the financial industry (europe) over her ill advised derivative trading that cost the company millions.
Most don't know what CDS's are, ( credit default swaps ) but it's a way of insuring oneself against losses in the financial world. I recently read an article, wish I could link but I can't find it, where a manager is manipulating the market by buying up CDS's on potentially weak credit companies, then offering them attractive financial backing, if they agree to default on debt by only couple days, allowing him to collect on CDS's. Sharks swimming with the minnows.
We need to correct this. All comments welcome. No political party crap, please.
Just 3-5 years or so ago Jamie Dimon fired the most highly heralded female exec in the financial industry (europe) over her ill advised derivative trading that cost the company millions.
Most don't know what CDS's are, ( credit default swaps ) but it's a way of insuring oneself against losses in the financial world. I recently read an article, wish I could link but I can't find it, where a manager is manipulating the market by buying up CDS's on potentially weak credit companies, then offering them attractive financial backing, if they agree to default on debt by only couple days, allowing him to collect on CDS's. Sharks swimming with the minnows.
We need to correct this. All comments welcome. No political party crap, please.
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