This is the complementary monograph to
Derivatives for Dummies & Journalists,
which targets layman and journalists, to provide a clear
down-to-earth explanation of the workings of the derivatives
Here, the focus is on a detailed, albeit pedestrian, account of
the history and factors leading to and following the "melt-down of
2008", with sufficient explanation of the workings of derivatives to
permit even the layman to understand easily the issues at hand.
The considerably amount of hard data shows that the primary cause of the
melt-down was the US Government and its agents (the GSE's Fannie,
Freddie, et al). While bankers have a share of the blame,
their contribution is seen as primarily that of "speed" of collapse.
The primary issues is the US Government's 1.5 Trillion dollar
"shadow bail-out" of the GSE's and the effective cover-up of the US
Government's culpability in the melt-down due their 7 Trillion
dollar over-supply of the sub-prime mortgage markets, and the repeal
of the Glass-Steagall Act.
For "market professional" level products, see also the