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Originally Posted by Shaze
LOL..exactly what i think. those list of banks are actually the smart ones. like they say there is always money being made by someone even in a recession. AIG is just like one big front to conceal who the robbers are. again, GO USA!!!! for hiding this from the people that our government is suppose to be serving and whose money they are actually using to make the payoffs.
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They created a bunch of contracts guaranteeing insurance on securities.
They never had means to pay this insurance. The CDS contracts are nothing more than a loophole designed to bypass insurance regulations set to prevent this behavior.
Another huge problem is Naked CDS where the firm insuring the security doesn't even own the underlying security. Its just making bets with moral hazard written all over it. These guys could of deliberately fucked up the economy, lets face it the motive is there.
There not tricking us. All the have to do is void all the Credit Default Swaps. What will they lose? The premiums paid to AIG?