bonddude

Three Card Monte and the Feigned Outrage Against AIG

1. AIG CEO told congress they had to provide almost 100% collateral when CDS contracts were "triggered". - Net effect being probable massive selling bias on all new exchange traded contracts creating more liquidation across all asset classes (excepting Oil and Metals if a major war breaks out).

2. There is a massive amount of other unregulated CDS CDO contracts estimated to be up to $250 Trillion in notional value world wide exerting massive selling pressure on the most liquid contracts- and this should be good for exchanges conducting these trades like selling picks and shovels to the 49ERS.

3. The net effects on the world economy seem to bear out the stag-deflation scenario that Roubini sees. Black Swan?