Who's really getting bailed out [View All]

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Derivative holders - The current value of derivatives is $1,000 Trillion. The US GDP is $15 Trillion or so. Derivatives are an out of control financial product, like gambling to hedge your bets in all cases. If any financial institution - bank, investment bank, insurance company - goes down and the you know what hits the fan with derivatives, it's "the end." Buffet calls these 'products' "weapons of mass financial destruction."

Here's the best explanation I've read on this, terrific stuff:

Headlined on 9/18/08: OpEdNews.Com (OEN)
It's the Derivatives, Stupid! Why Fannie, Freddie and AIG Had to Be Bailed Out

by Ellen Brown

What's going on here? Why not let the free market work? Bankruptcy courts know how to sort out assets and reorganize companies so they can operate again. Why the extraordinary measures for Fannie, Freddie and AIG?

The answer may have less to do with saving the insurance business, the housing market, or the Chinese investors clamoring for a bailout than with the greatest Ponzi scheme in history, one that is holding up the entire private global banking system. What had to be saved at all costs was not housing or the dollar but the financial derivatives industry; and the precipice from which it had to be saved was an "event of default" that could have collapsed a quadrillion dollar derivatives bubble, a collapse that could take the entire global banking system down with it.

Also see: Money Party to Citizens: Drop Dead! The Money Party (4)