For more information on Derivatives and what they have to do with all this bailout mess and the credit crisis, please see the article Why Fannie. Freddie, and AIG had to be Bailed out. This is a direct result of the failed Derivatives market which is going to come crashing down in an unprecedented fashion because it is a 1 freaking Qaudrillion Dollars MONSTER!

The $700 billion will only ensure the safety net for the select few executives and top investors from those firms because there is a MUCH BIGGER ISSUE - a much larger and extraordinary MONSTER about to be unleashed on the American economy and it's people and we are wasting $700 billion dollars because of our own stupidity.

For God's sake everyone, WAKE UP and get up and DEMAND that this $700 billion Bailout bill not be passed. Then take some time to learn about what the hell is going on and independently THINK about what we need to do to fix it so that EVERYONE is protected, especially the future for our children and grandchildren.

McCain doesn't have the answer and neither does Obama. It is IMPERATIVE that the people rise up and demand change and do not allow this $700 billion Wall Street bailout to go through.

Laura/whereabout
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$1 Quadrillion of Unregulated

Debt At Core

of Coming Derivatives Crisis

By John Tiffany

Despite
all the blather and swearing-on-the-Bible pronunciamentos from
establishment “pundits,” our house-of-cards financial system is not
fundamentally sound.

Expect such indices as the Dow to tumble even much lower when the Pandora’s box of derivatives is fully opened.

Believe
it or not, the Dow is still not far from its all-time peaks, with a lot
further to fall. The depression is still in its early stages. We are
looking at $1 quadrillion of unregulated debt, with much of it at risk.
(And we used to think $1 trillion was a lot.)

These are
literally inconceivable sums. Counting one dollar per second, it would
take 32 million years to count to one quadrillion.

The stock
market in this era of the privately owned Federal Reserve Bank is a
giant craps shoot. Much of it is quite unregulated, especially the
invisible market of derivatives. The sub-prime mortgage market
collapsed, which is now being followed by a giant credit crisis. Now we
are looking at the possible collapse of the derivative market.

President
Bush failed at every business he has been associated with. He has
always had his dad to bail him out to avoid bankruptcy. But this time
his dad and even Henry Paulson can’t keep Bush from facing the failure
of his economic policies at the helm of the U.S. economy.

America’s
oversized debt pyramid has just begun to wind down. The Federal Reserve
has announced that it is giving an $85 billion loan to American
International Group (AIG), the world’s largest financial conglomerate,
in exchange for a nearly 80 percent stake in the firm.

The Associated Press calls it a “government takeover,” but as Ellen Brown, J.D., author of The Web of Debt,
says, this is not a real nationalization like the purchase of Fannie
Mae/Freddie Mac stock by the U.S. Treasury. “The Federal Reserve,” she
points out, “has the power to print the national money supply, but it
is not actually a part of the U.S. government.

It is a private
banking corporation, owned by a consortium of private banks. The
private banking industry just bought the world’s largest insurance
company.” But they used taxpayer money to do it.

Proposals for
reforming the banking system are not even on the radar screen of
establishment politics, but the current system is collapsing at
train-wreck speed. Says Brown: “We need to stop funding the culprits
who brought us this debacle at our expense. We need a public banking
system that makes a cost-effective credit mechanism available for
homeowners, manufacturing, renewable energy, and infrastructure; and
the first step to making it cost effective is to strip out the swarms
of gamblers, fraudsters and profiteers now gaming the system.”

John
Tiffany is the copy editor for American Free Press. He is also the
assistant editor of THE BARNES REVIEW (TBR) historical magazine. For a
sample copy of TBR (editor’s choice) send $3 to TBR, P.O. Box
15877,Washington, D.C. 20003.


Just What Are Derivatives?

Derivatives
are financial instruments whose value changes in response to the
changes in underlying variables. The main types of derivatives are
futures, forwards, options and swaps.

The main use of
derivatives is to reduce risk for one party. The diverse range of
potential underlying assets and pay-off alternatives leads to a wide
range of derivatives contracts available to be traded in the market.
Derivatives can be based on different types of assets such as
commodities, equities (stocks), bonds, interest rates, exchange rates
or indexes (such as a stock market index, consumer price index
(CPI)—inflation derivatives—or even an index of weather conditions, or
other derivatives). Their performance can determine both the amount and
the timing of the pay-offs.

Stock index futures and options are
known as derivative products because they derive their existence from
actual market indices, but have no intrinsic characteristics of their
own. In addition to that, one of the reasons some believe they lead to
greater market volatility is that huge amounts of securities can be
controlled by relatively small amounts of margin or option premiums.
One reason derivatives are popular is because they can be transacted
off balance sheets.