A Major “Derivatives Crisis” Is Coming, The Whole World Would Be Thrown Into A State of Chaos Read
October 14th, 2012
Derivatives are financial weapons of mass destruction, carrying dangers that, while now latent, are potentially lethal,” Warren Buffett wrote in 2002
How the perfect derivative storm could cost you 90% of your retirement
Those on the wrong end of the coming crash are going to be absolutely wiped out.
Most Americans do not understand what “derivatives” are, so they kind of tune out when people start talking about them. But they are very important to understand. Essentially, derivatives are “side bets”. When you buy a derivative, you are not investing in anything. You are just gambling that something will or will not happen. I explained this more completely in a previous article entitled “The Coming Derivatives Crisis That Could Destroy The Entire Global Financial System“….
A derivative has no underlying value of its own. A derivative is essentially a side bet. Usually these side bets are highly leveraged. At this point, making side bets has totally gotten out of control in the financial world. Side bets are being made on just about anything you can possibly imagine, and the major Wall Street banks are making a ton of money from it. This system is almost entirely unregulated and it is totally dominated by the big international banks. Over the past couple of decades, the derivatives market has multiplied in size. Everything is going to be fine as long as the system stays in balance. But once it gets out of balance we could witness a string of financial crashes that no government on earth will be able to fix.