Snarky Behavior

Pessimistic

October 10, 2008 · Leave a Comment

The more I read about this crisis, the more pessimistic I become.  The amount of credit defaults swaps out there is just mind-boggingly ridiculous… an estimated $62 trillion dollars.

The 2008 estimated global GDP is only $65 trillion.

That means we have insurance policies out there looking to collect when various banks and other institutions fail for 95% of our global economy.

I don’t really know enough about this to comment anything meaningful, but it seems really quite scary.  You just can’t pay out on policies when everyone is effected.  That’s not how risk-management works.

It’s like the whole world is flooded, and everyone wants to collect on their flood insurance.

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