Now, another peculiar feature of the derivative bomb is that
most of it sits off the exchanges, and traded over the counter.
Since they stopped the trading last week, now everyone can mark up
the values of their portfolios to a model, which means
everything will be fine, as long as they don't re-open trading on
November, 26 as promised, but keep that troubled market shut
down until year end. We'll have a Santa rally then -g-
Don't ask, don't tell. If a contract trades between 2 parties,
both parties are interested in keeping their mouth shut.
However, the latest fight has not been victorious for the
PPT, as various parts of the credit derivatives market keep
detonating. The big bomb grew to be very large, and it's
now reaching the critical mass at which the whole big bomb
detonates in uncontrollable fashion. -g- In other words,
this market is very resilient to small fires, but the
risk of a huge fire is actually growing exponentially with
the size of the bomb. The huge fire is a total systemic
meltdown, and the Fed will viciously fight that until
the big bomb reaches a critical mass and blows up the Fed. |
