Tuesday, March 03, 2009
Global crash: What preceeded global financial network reset ?
The total US federal debt doubled from 30 000 to 65 000 $ Billion during the Bush second mandate. That is the way how he actually made the US secure: By unsubstantiated financial security means ! $35T belongs to CDO squared !
Current global financial system is in an "undefined state."
After not an individual computer crash, of course, but a computer crash in the sense of Sun Microsystems' erstwhile marketing slogan, "the network is the computer." That is, we have all of these machines in different sectors of the economy, and we've networked all of them together either directly (via an actual network) or indirectly (by using the collective "output" of machines in one sector as input for the machines in another sector), and like any other computer system the whole thing hums along nicely... up until the point when it doesn't.
How the global network actually crashed.
The CDS and CDO markets grew together, feeding on each other. At the end of 2001, there was $920 billion in credit default swaps outstanding. By the end of 2007, that number had skyrocketed to more than $62 trillion. The CDO market, which stood at $275 billion in 2000, grew to $4.7 trillion by 2006.
Current global financial system is in an "undefined state."
After not an individual computer crash, of course, but a computer crash in the sense of Sun Microsystems' erstwhile marketing slogan, "the network is the computer." That is, we have all of these machines in different sectors of the economy, and we've networked all of them together either directly (via an actual network) or indirectly (by using the collective "output" of machines in one sector as input for the machines in another sector), and like any other computer system the whole thing hums along nicely... up until the point when it doesn't.
How the global network actually crashed.
The CDS and CDO markets grew together, feeding on each other. At the end of 2001, there was $920 billion in credit default swaps outstanding. By the end of 2007, that number had skyrocketed to more than $62 trillion. The CDO market, which stood at $275 billion in 2000, grew to $4.7 trillion by 2006.
THIS LINK posted by Joseph Bell : 2:57 PM
