wolfstrike
10-27-2008, 01:34 AM
in a story played by 60 Minutes, opposite the World Series, the show expained one of the major reasons for our financial crisis.
"Derivatives"
as best i could understand from the 60 Minutes program, since the explanation wasn't very thorough, "Derivatives" are a type of "side bet" offered by large insurance companies that allow people to make wagers against stocks without purchasing them.
insurance companies are not required to prove assets to cover these bets.
investors can wager whether a stock will will do good or will go bad, or on companies or other things.
it's legalized gambling on capitalism.
the effects of this are obvious, too many people in Wall Street would have an extra interest if a company or a stock fails, and would help it to do so if possible.
this practice was already outlawed.
a long time ago parlors were open all over Wall Street where people could purchase these wagers
it was made illegal in 1907 when it caused a recession.
it remained illegal until 2000 when Alan Greenspan (who claimed he had no idea how the current crisis happened) pushed the idea of making derivatives legal again.
the bill was heavily supported by Bill Clinton and passed by the republican majority lead 106th lame duck Congress.
the three major companies that were in trouble did so because of the money owed to these derivatives.
these derivatives can pay dollars to the penny, and there's already several people known to have pulled over a billion from the current financial crisis.
when the bill was passed there was a provision that over ruled the states ability to stop it in their state, so our beloved politicians KNEW this would turn into bad news.
once again we can thank the governemnt, our biggest enemy, on another bipartisan effort to screw us.
"Derivatives"
as best i could understand from the 60 Minutes program, since the explanation wasn't very thorough, "Derivatives" are a type of "side bet" offered by large insurance companies that allow people to make wagers against stocks without purchasing them.
insurance companies are not required to prove assets to cover these bets.
investors can wager whether a stock will will do good or will go bad, or on companies or other things.
it's legalized gambling on capitalism.
the effects of this are obvious, too many people in Wall Street would have an extra interest if a company or a stock fails, and would help it to do so if possible.
this practice was already outlawed.
a long time ago parlors were open all over Wall Street where people could purchase these wagers
it was made illegal in 1907 when it caused a recession.
it remained illegal until 2000 when Alan Greenspan (who claimed he had no idea how the current crisis happened) pushed the idea of making derivatives legal again.
the bill was heavily supported by Bill Clinton and passed by the republican majority lead 106th lame duck Congress.
the three major companies that were in trouble did so because of the money owed to these derivatives.
these derivatives can pay dollars to the penny, and there's already several people known to have pulled over a billion from the current financial crisis.
when the bill was passed there was a provision that over ruled the states ability to stop it in their state, so our beloved politicians KNEW this would turn into bad news.
once again we can thank the governemnt, our biggest enemy, on another bipartisan effort to screw us.