What is the estimated value of the worthless credit default swaps on these estimated defaulted mortgages? How does that affect the situation?
The entire credit default swap market is over $60 trillion.
I don’t know how much of that is on mortgages.
It’s all the same risk, just parceled out into different forms.
People keep thinking that CDS are some sort of multiplier. They’re not. They just take the same original risk and try to hedge against it.