Geopolitical Implications of the World Economic CrisisQuicklink submitted by John Smith Permalink
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|The origin of the crisis lies in deregulated credit derivatives of various types. The proper way to understand derivatives is that they are some form of paper based on paper. Anytime we are more than one step removed from an underlying asset we are dealing with derivatives. The Bank of International Settlements admits that there are around ~$600 trillion in derivatives out there (4). This is more than ten times the entire GDP of the Earth, which is about ~$58 trillion. Other sources indicate that the outstanding amount of derivatives of all types approached ~$1.5 quadrillion, and has now fallen to a mere ~$1 quadrillion .|
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