If you squint at my graphic from the Bank of International Settlements, which is denominated in billions, you can (barely) see that the amount outstanding in over-the-counter financial derivatives is on the order of…
Six hundred thousand billion dollars. more than six hundred trillion dollars, $600,000,000,000,000, which works out to $100,000 for every living human being.
It gets worse.
These stats from the Bank of International Settlements only include over-the-counter derivatives, and that’s only about half the market!
In the other main category of “listed derivatives,” there’s approximately the same amount of derivatives all over again, and that brings the grand total of financial derivatives on Planet Earth to slightly more than one QUADRILLION dollars, and that’s about $200,000 for every living human being, but…
It gets worse, at least for us (potentially) very, very unlucky Americans, because we account for about one fourth of the global economy, with a GDP of $16 trillion out of a global GDP of about $65 trillion, and that means that our share is about one fourth of all those financial obligations, which is approximately $300,000,000,000,000, three hundred trillion dollars, or a little more than…
One million dollars for every living American.
And since all my figures only account for the most recent statistics available from BIS and other sources, and all those numbers were actually increasing when last reported, for example, from $547 trillion in December 2008 to $604 trillion in June 2009, the total amount of financial derivations today is almost certainly even more monstrous than what I described.
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Note: Although “official sources” constantly deny that anyone will ever be forced to cover all these monstrous bets, it’s instructive to consider what actually occurred in Iceland, rather than trusting the opaque assurances of financial insiders.
After derivatives bankrupted three Icelandic banks in 2009, liability was assigned to the entire nation of Iceland, in the amount of about $18,000 for every citizen.
An equivalent disaster in the United States would amount to about $5.4 trillion, and since the credit of the United States is already fully extended, to say the least, an additional $5.4 trillion in federal debt could only be generated by a tsunami of “fiat currency” from the Federal Reserve, with approximately the same outcome as Weimar Germany attained when they tried to print their way out of monstrous debts, and 50,000,000 marks wouldn’t even buy you an egg.
