Credit Default Swaps (CDS) ... Nuke !

Discussion in 'Trading' started by Digs, Apr 6, 2008.

  1. Digs


    Why would anyone LONG the stock market with these out there.

    There is $45 Trillion of CDS, and there not worth $45 Trillion.

    Why are these not getting headline news...with revaluations downwards...

    .."Warren Buffett famously described derivatives bought speculatively as "financial weapons of mass destruction." In Berkshire Hathaway's annual report to shareholders in 2002, he said "Unless derivatives contracts are collateralized or guaranteed, their ultimate value also depends on the creditworthiness of the counterparties to them. In the meantime, though, before a contract is settled, the counterparties record profits and losses -often huge in amount- in their current earnings statements without so much as a penny changing hands. The range of derivatives contracts is limited only by the imagination of man (or sometimes, so it seems, madmen)." ...
  2. No offense, but have you been asleep for a few years?
  3. Digs


    None taken, and whats your point .. are you telling me CDS are nothing to worry about.
  4. I think he's saying that the market's known about these for a while now.