Promoted. Originally posted 2008-10-04 13:53:38 -0500. -- GH
Update: Just saw this on 60 minutes.. 60 Minutes: How Some Arcane Wall Street Financial Instruments Magnified Economic Crisis (An eye opening investigation - buzz word is "swap.")
...this market is almost entirely unregulated.
The result is a huge shadow market that may control our financial destiny, and yet the details of these private insurance contracts are hidden from the public, from stockholders and federal regulators. No one knows what they cover, who owns them, and whether or not they have the money to pay them off.
One of the few sources of information is the International Swaps and Derivatives Association (ISDA), a trade organization made up the largest financial institutions in the world. Many of them are the very same companies that created the vast shadow market, lobbied to keep it unregulated, and are now drowning because of unanticipated risks.
It's like what Luaptifer worries about: We have the people who created the mess in control of the mess.
The hits just keep on acoming!.
In that piece, they talk about some of the people who did these deals... like the guy who was a bartender until he became a mortgage backed securities guy, or the guy just out of college, doing the same thing as Mike and making $100,000 a month.