[wheels]

Derivatives are not complex at all. Moreover, they have existed in various forms for thousands of years and are necessary if you want to eat. If you quit watching Network News and read a book, you would not sound so uniformed.

Here is an example of a derivative.

Farmer Larry plants 100 acres of wheat every Spring. Each Spring he also agrees to sell that wheat at a certain price on a certain date in October, to a certain person. Farmer Larry has just entered into a derivatives contract.

There is probably a good chance your Utility bill is a derivative contract every month. If you agree to pay a fixed monthly rate, like I do, regardless of your amount of usage, then you have probably entered into a derivatives contract.

[Tuco-bad]

Derivatives are not complex at all. Moreover, they have existed in various forms for thousands of years and are necessary if you want to eat. If you quit watching Network News and read a book, you would not sound so uninformed.

Yes there are derivatives and there are derivatives.

The ones you refer to are the simpliest of derivatives.

Enron was dealing in the most complex of derivatives; derivatives even Enron hardly understood.

That's why they're going belly up.