5 U.S. Banks Each Have More Than 40 Trillion Dollars In Exposure To Derivatives

“Exposure” = “unrecoverable debt”. KISS those pension funds good-bye and write some good protective law. I read a statement today that said cons know “honest men cannot be conned.” Meaning there must be a little larceny in the mind of the “mark.” What does that say about some judges?

Justice League

Submitted by Michael Snyder of The Economic Collapse blog,

The “too big to fail” banks run up enormous profits from their derivatives trading.  According to the New York Times, U.S. banks “have nearly $280 trillion of derivatives on their books” even though the financial crisis of 2008 demonstrated how dangerous they could be…

American banks have nearly $280 trillion of derivatives on their books, and they earn some of their biggest profits from trading in them. But the 2008 crisis revealed how flaws in the market had allowed for dangerous buildups of risk at large Wall Street firms and worsened the run on the banking system.

The big banks have sophisticated computer models which are supposed to keep the system stable and help them manage these risks.

But all computer models are based on assumptions.

And all of those assumptions were originally made by flesh and blood people.

When…

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