Comments on: Too Big To Fail http://lonelyconservative.com/2010/04/too-big-to-fail/ Observations from a conservative in a blue state. With a little help from my friends! Sun, 27 May 2012 03:54:17 +0000 hourly 1 http://wordpress.org/?v=3.3.2 By: PhysicsNuthttp://lonelyconservative.com/2010/04/too-big-to-fail/comment-page-1/#comment-20857 PhysicsNut Tue, 13 Apr 2010 15:17:00 +0000 http://www.lonelyconservative.com/?p=19138#comment-20857 The 'too big to fail' catch-phrase is totally misleading because the real issue is the interlinking caused by Credit Default Swaps, which for unknown reasons have exploded in the past 10 years. Because of CDS if AIG goes bankrupt then it will take down other companies with it - and furthermore, nobody knows how to figure out what a company's exposure is as a result of CDS. Nobody can properly evaluate the risks - that is why TARP was not used as originally intended. See John Talbott's book "86 Biggest Lies on Wall St". Actually it is more like 'too complicated to fail' And just to make it more complicated, the lobbyists are making sure it stays that way. Come to think of it - Lobbyists make money because the legal system is too complicated. It is a racket. The ‘too big to fail’ catch-phrase is totally misleading
because the real issue is the interlinking caused by
Credit Default Swaps, which for unknown reasons have
exploded in the past 10 years. Because of CDS if AIG
goes bankrupt then it will take down other companies
with it – and furthermore, nobody knows how to figure
out what a company’s exposure is as a result of CDS.
Nobody can properly evaluate the risks – that is why
TARP was not used as originally intended. See John
Talbott’s book “86 Biggest Lies on Wall St”.
Actually it is more like ‘too complicated to fail’
And just to make it more complicated, the lobbyists
are making sure it stays that way. Come to think of
it – Lobbyists make money because the legal system is
too complicated. It is a racket.

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