The market for credit default swaps is unregulated, untransparent, and highly dangerous. And its estimated worth is over three times the total value of US equities. “A CDS is a bit like a blind date,” says Andrew Snyder, “at first, they sound like a fantastic idea. But we all know differently.”

The US subprime and credit crisis has cost the world over $7.7 trillion, according to a report released in February by Bank of America.
The worst could yet be to come. Shah Gilani in Money Morning says the $62 trillion market for credit default swaps (CDS) is a ticking bomb.
The derivative instruments – which offer insurance against default – are neither transparent nor regulated. But they are all at risk. And they are already causing huge writedowns in the banking sector…

Sometimes when you’re scouring the news, you see a statistic that renders you almost speechless. You can’t quite get your head around what it really means, you just know that it’s a knockout number.

Sometimes when you’re scouring the news, you see a statistic that renders you almost speechless. You can’t quite get your head around what it really means, you just know that it’s a knockout number.

Reading this Bloomberg story about the increasing demands being made on the Fed, I couldn’t help but think of the theme song to the vintage TV series “Car 54, Where are You?”