fxtrader07

Coming Soon: The $600 Trillion Derivatives Emergency Meeting

sorry, but this is just another example of getting hysteric about a threat of derivatives implosion. the danger is real, yes, but the probability as well as the true amounts involved are grossly overstated imho.
the biggest danger is that the non-lending by banks leads to corporate defaults by otherwise sound companies which in turn would trigger CDS-events. The net-net amounts even in the case of LEH will be far, far less than the fear mongerers predict here. it may be anywhere bewteen 8 billion and 100 but that#s about it and even if a couple of counterparties were to default you may not even hear about it. restv assured, the BIS, the fed, ecb and the IMF are all in close contacts with the big players. the cds market may be absolutely intransparent and unregulated - but right here right now he powers that be will absolutely ensure that it will not go into a collapsing mode.
1 week from now, when the LEH case has been finally settled and the derivatives world has not turned into a supernova people will slowly start to realize that the wordl is not coming to an end. and all of a sudden, bank lending will slowly start again . and stock markets will see some heavy upward spikes.
too optimistic? maybe. but not unlikely. in any case, the staggering notional amounts involved seem to confuse people and lead them to underestimate the vast resources of the combined central banks