[Warlord]

“You may not think so, but if you look through the thread you will find at least a few people who are very interested in them.”

There is nothing new in the first lesson. That's objective fact. That doesn't mean that the lesson is unworthy of posting. Nevertheless, I concede that my interest in the thread is not the lesson as much as dealing with the idea that somehow the lessons (if the first is indicative of the series) make any sort of case against the general use of derivatives.

[palmer]

any sort of case against the general use of derivatives

Privatized profits, socialized risks. If that's obvious from recent history, then you would need to provide an alternative explanation for the bailouts of derivative counterparties like AIG.

[politicket]

Nevertheless, I concede that my interest in the thread is not the lesson as much as dealing with the idea that somehow the lessons (if the first is indicative of the series) make any sort of case against the general use of derivatives.

Stay tuned for the rest of the Lessons (next one coming in a little while).

I'm not arguing against CDS's, nor combining and using them in CDO's. I'm saying that they can be, and were, abused heavily - without consideration being taken of the downside. That downside is about to bury us financially.