Credit Derivatives

This why I still believe...

that they knew about this "crisis" coming down the pike at least as far back as 2003 when they were using that obscure civil war era banking law to block the state lawsuits against the banking institutions. They knew this was all coming and they needed to get legislation in place that would protect the lifestyles of their rich and blameless allies.

"It turns out that one of the features of the 2005 Bankruptcy bill was to put derivative counter parties [like CDS holders] at the front of the line ahead of other creditors in bankruptcy proceedings. Actually, from what I can tell, they don't just go to the head of the line. They got to skip the line entirely. As the Financial Times noted last fall, "the 2005 changes made clear that certain derivatives and financial transactions were exempt from provisions in the bankruptcy code that freeze a failed company's assets until a court decides how to apportion them among creditors."" - Josh Marshall

Legislation like that doesn't just come out of nowhere.

It takes time for them to figure out what they want to achieve and how they want to achieve it. And then there is the need to find the right time and the right place to slip the junk in.

They could have solved many of these problems years ago and mitigated some of the disastrous results but, instead, they purposefully let it build while protecting themselves and waited for just the right time to unleash the "crisis" on the nation, knowing it would tie the hands of the next administration financially.

IOW: They did manage to drown the government in a Katrina sized bath tub.

Also, I think they were hoping the GOP could capitalize on it politically during the elections. What they didn't count on was John McCain's doe in the headlights reaction looking as stupid as it did, nor the fact that some would figure out how it all really happened so fast that a huge backlash would ensue coupled with the reality that Americans just don't trust republicans with their money anymore and in any way. The GOP is a walking and talking financial zombie.

This was all nothing more than a well orchestrated game of CYA and collusion between politicians and their financial owners. Real, honest "Disaster Capitalism" in an ufetterred free-market-run-amok at its worst.

 [So I was wrong. Clearly edited to reflect less "DUH".]

What's Coming Next, or Is Collapse Over, Nope!

I'm not an economist and the only real numbers I crunch are my personal expenses and when bidding construction jobs putting together those costs and percentages which in these latter years of my life, preferring more to do the work, I have done very little of, except while doing the work to bring a better quality for hopefully a bit cheaper cost in material and professional skill.

Watching what is now taking place in banking and the dream new capitalist economy that's been sold for a number of years isn't really a big surprise to this common man, many were forecasting exactly what would happen if we followed the sales pitch.

Following is a report from CBS that hits on the next shoe to drop or dropping already as we've seen with the collapse of a number of finance institutions but not yet talked about but part of what we the tax payers are already bailing out.