Next bubble: $600 trillion?

Discussion in 'Economics' started by bearice, Apr 20, 2010.

  1. Perhaps we have to consider the political implication of a worldwide bankrupcy again..:D

    A world government:

    A) fascist

    B) Communist

    C) Constitutional democratic federation

    People in power, just got to understand the inter-connections that bind them all together.

    They see everyday, angry crowds in Thailand and dragging-on Insurgency in Afghanistan.

    They also have to consider the mess, failed states cause around with North Korea constantly on the verge of widespread famine.

    Things will get solved, hopefully some relevant cases of fraud will advance the case of financial reforms

    Even if that feed public disgust toward everything big, you don't cook eggs without breaking them first.
     
    #21     Apr 24, 2010
  2. Yes, i know..derivatives are not 10 times world GDP.

    But they're worth worrying, along with trade relationship, nuclear proliferation, electronic criminality and climate change.
     
    #22     Apr 24, 2010
  3. World GDP is $60 Trillion whereas derivatives are worth $600 Trillion. So derivatives are 10 times world GDP. I think few people know this truth/fact.
     
    #23     Apr 26, 2010
  4. That's silly... Derivatives are NOT worth $600 trln. How many times does this have to be said?
     
    #24     Apr 26, 2010
  5. AK100

    AK100

    Surely with a $10, $20 or even $30billion+ endowment it doesn't need to make any more money?

    Just match inflation, plus 1% (that might not be as easy as it sounds with such a large amount) and you've got millions and millions and millions to invest in teaching and teaching facilities.

    Am I missing something?
     
    #25     Apr 26, 2010
  6. GTS

    GTS

    Yes, you are missing how much Harvard spends on teaching and teaching facilities.
     
    #26     Apr 26, 2010
  7. Derivatives were worth $1,400 Trillion or $1,100 Trillion. Now the derivatives are worth $600 Trillion only.
     
    #27     Apr 26, 2010
  8. As I keep saying over and over again, the gross total notional amount of $600trn has nothing whatsoever to do with how much derivatives are worth (the NPV) and what risks they represent. That is about as trivial a fact as you could get.
     
    #28     Apr 26, 2010

  9. Bro, no offense, u are trying to sound smart but you are not really saying anthying. can you elaborate please.

    the figure of 600 trillion as i understand it is a geustimate of total outstanding notional values.

    if you are trying to use NPV as a barometer, lets say an IRR is like 5%. 5% i am using arbitrairly, does this drastically change anyting.

    NPV in reality has nothing to do with counterparty risk. bottom line is, if the exposure that someone was trying to hedge becomes naked bc of lets say a bond default, a counterparty can loose the whole value of the contract and cause a dominoe efffect. who gives a fuck about NPV.

    what would u geustimate is an accurate measure of exposure.
     
    #29     Apr 26, 2010
  10. I have already done it in another thread, maybe even two threads. Here's one:
    http://www.elitetrader.com/vb/showt...0&perpage=6&highlight=eurodollar&pagenumber=1
    Here's another:
    http://www.elitetrader.com/vb/showt...393&perpage=6&highlight=notional&pagenumber=1
     
    #30     Apr 26, 2010