Tag Archives: Derivatives

The Coming Derivatives Crisis That Could Destroy the Entire Global Financial System


By The Economic Collapse

Most people have no idea that Wall Street has become a gigantic financial casino.  The big Wall Street banks are making tens of billions of dollars a year in the derivatives market, and nobody in the financial community wants the party to end.

The word “derivatives” sounds complicated and technical, but understanding them is really not that hard.  A derivative is essentially a fancy way of saying that a bet has been made.  Originally, these bets were designed to hedge risk, but today the derivatives market has mushroomed into a mountain of speculation unlike anything the world has ever seen before.

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‘Inside Job’ obscures ongoing regulator collusion in Wall Street fraud

By Jeff Gates
Arab News.com

Part 4 of 4

A popular documentary, Inside Job, captured kudos at the 2010 Academy Awards. Its hard-hitting analysis marked a milestone among filmmakers for shining light in the dark corners of Wall Street. Writer, producer and director Charles Ferguson provided a public service by exposing key perpetrators.

Laudable yet incomplete, Ferguson’s popular film left unaddressed the all-important “how.” The storyline left moviegoers with the impression that the film’s featured insiders operated virtually alone in perpetrating history’s greatest heist. In truth, the real “inside job” is far more sinister and remains ongoing.

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Obama and Geithner – Back to the Future on Corporate Tax Breaks and Derivatives

Michael Collins

Speculation reigns supreme in your nation’s capital. Who is next in line after the bin Laden operation? The bipartisan coalition directing the war on terror forgot one important fact about the security of the United States of America. It doesn’t matter who they kill overseas, the assault on almost all citizens continues unabated at home. No one is doing anything to stop it. Only the financial and political elite remain immune. (Image-WikiCommons)

According to the National Bureau of Economic Research, the national economic collapse (aka recession) ended June 2009. That’s news to the 55% of the public that believe we’re in either a recession or depression (April 2011).

Official unemployment is around 9%. That excludes the marginally employed and under employed. Adding those two groups takes unemployment up to 15.9%. Add the long-term unemployed and the figure climbs to nearly 23%.


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The Good the Bad and the Ugly in the Dodd Bill

  • Real Economy Project PRWatch March 16, 2010

Here are some highlights regarding the 1,300 page bank reform bill released by U.S. Senator Chris Dodd (D-CN) yesterday.

THE GOOD

1) Capital requirements and leveraging requirements to be set by regulators (although some reformers would like these set in law to makes sure they do the job).

2) Creates a council of systemic risk regulators called a Financial Stability Oversight Council, which is generally a good idea. We don’t want to just leave it to the Federal Reserve.

3) Obama’s “Volcker Rule” included, not perfect, but at least it made the cut.

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Accounting Fraud Continues to Plague U.S. Economy

By Zach Carter, Media Consortium blogger              Care2

Senate Banking Committee Chairman Chris Dodd (D-CT) unveiled his latest financial reform proposal on Monday, and the stakes for the new legislation couldn’t be higher. After consumer groups raised a major ruckus, Dodd has dropped one of his most egregious concessions to the bank lobby—cutting enforcement authority from the proposed Consumer Financial Protection Agency (CFPA). That’s good news: Without a major regulatory overhaul, the U.S. economy’s destructive boom and bust cycle will start all over again.

We’ve been down this road before. The Enron fiasco should have served as a wake-up call for policymakers, but instead, the weak federal response to Enron’s major fraud helped pave the way for the current economic slump.

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