Nightmare Scenario? The Law of Unintended Consequenses?
Plummeting Oil Prices Could Destroy The Banks That Are Holding Trillions In Commodity Derivatives
From the article:
Could rapidly falling oil prices trigger a nightmare scenario for the commodity derivatives market? The big Wall Street banks did not expect plunging home prices to cause a mortgage-backed securities implosion back in 2008, and their models did not anticipate a decline in the price of oil by more than 40 dollars in less than six months this time either.
Quite frankly I don’t know if I believe this….Wall Street had no idea how this would play out? Come on now…they don’t think that far ahead? To me it’s seems more likely they play the game and get out early. And they know when to get out. (The cards are stacked.) Then, they let the chips fall where they may.
You and I aren’t not part of the equation. Except that we’ve been had and are on the hook. Is it really more complicated than that?
It has been estimated that the six largest “too big to fail” banks control $3.9 trillion in commodity derivatives contracts. And a very large chunk of that amount is made up of oil derivatives.
And this is why the bill in the previous article protected the banks.