The $60 Trillion Nightmare of Credit Default Swaps

That’s more than the entire world’s GDP combinedThe $60 Trillion Nightmare of Credit Default Swaps - Seeking Alpha: "The 60 plus trillion dollar nightmare of the CDS (Credit Default Swaps) market is a dangerous anomaly of the tail wagging the dog, pushing risk premium higher against a downward spiral of collapsing market capitalization and lowered credit ratings for corporate debt. Imagine, 60 plus trillion dollars in total existing liabilities in the unregulated OTC (Over-The-Counter) market of Credit Default Swaps means that our government, in fact, all governments interconnected in the global economy could not possibly “bail out” that entire amount if ever forced to claim. That’s more than the entire world’s GDP combined!"

WHAT ARE CREDIT DEFAULT SWAPS? MARKETPLACE.ORG > Reaction has been very positive to Paddy’s first lesson on collateralized debt obligations — “Uncorking CDOs.” If you haven’t seen it, he’ll make you an expert.