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Politics : The Trump Presidency
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To: i-node who wrote (8638)1/29/2017 3:42:25 PM
From: combjelly  Read Replies (2) of 360557
 
No, it was the wide use of credit default swaps and like derivatives. The collapse of all of those mortgages written by Countrywide and its ilk was but the trigger. It could have happened any number of other places. Like the heavy credit card debt.

A growing problem is the debt being carried by third and developing world countries denominated in currencies other than their own. As the dollar strengthens, that will only put more pressure on their ability to pay. And, of course, those loans are often hedged with CDS's. And, naturally, other parties are betting that those loans will be defaulted on by buying CDS's on those loans.
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