We've detected that you're using an ad content blocking browser plug-in or feature. Ads provide a critical source of revenue to the continued operation of Silicon Investor.  We ask that you disable ad blocking while on Silicon Investor in the best interests of our community.  If you are not using an ad blocker but are still receiving this message, make sure your browser's tracking protection is set to the 'standard' level.
Derivatives: Darth Vader's Revenge
An SI Board Since August 1998
Posts SubjectMarks Bans
2704 87 0
Emcee:  Worswick Type:  Unmoderated
According to informed sources as of March of this year the Long TErm Credit Bank of Japan had approximately 50 trillion yen of derivative contracts $725 billion dollars as of the exhcange yen/dollar currency rates of August, 1998.

Now that LTCB is finally acknowledged to be broke what has happened to this exposure? Has $725 billion dollars gone to money heaven?

One worries.

What does this portend for our own banks where all derivative contracts appear to be cross linked?

Is the global financial system about to be swamped with between $100 trillion and $500 trillion in unresolvable derivative contracts?

Where does one hide in this scenario?

According to the Federal Reserve Bank of New York...."activities in the 1996 annual reports of a sample of the largest, internationally active banks and securities firms in the G-10 countries, and notes improvements since 1993. The analysis builds, in part, upon a framework used by the Federal Reserve in analyzing the trading and derivatives disclosures of major U.S. banking organizations.

In total, 79 major banks and securities firms in the G-10 countries comprised the sample reviewed for the 1993-1996 period, representing over $14 trillion in total assets and over $83 trillion in notional amounts of derivative instruments. Disclosures in the 1995 and 1996 annual reports of a major securities firm in Hong Kong were also reviewed.

The analysis revealed that there have been general improvements as well as voluntary innovations in the annual report disclosures of a number of the surveyed firms. In particular, there were notable improvements in quantitative disclosures about market risk in 1996 and 1995. However, despite encouraging advances in disclosure practices by a number of institutions in the G-10 countries, many institutions continued to disclose very little about their trading and derivatives activities".

Please See:

...for the full text of the 37 page report and the abstract.

Personally, I am worried about this.

I am surprised that a discussion of one of the most pressing questions of our time.... has not been addressed sooner.

Thanks for your consideration and, I hope, interest.

Previous 25 | Next 25 | View Recent | Post Message
Go to reply# or date (mm/dd/yy):
ReplyMessage PreviewFromRecsPosted
2704An old reminder money.visualcapitalist.comggersh-12/17/2019
2703Ah, the true "skinny" ... and the new and not so new interlocking pWorswick111/4/2019 President Obama stated during this press conference thaggersh-9/6/2019 No one blinks an eye at $22 trillion in debt, trillion dggersh-9/3/2019
2700Is this yet another bomb in waiting? Surge in corporate debt with negative yielSam18/30/2019
2699Here we go .... July 22, 2019 Gains Pains Capital Is This What Has Got the FeWorswick47/22/2019
2698A Bank With $49 Trillion In Derivatives Exposure Is Melting Down Before Our EyesWorswick27/21/2019
2697Remember this ‘If Iran can't export oil no-one in Middleggersh-6/24/2019
2696Escobar: One Quadrillion Reasons Why Washington Fears Iran's "Maximum CWorswick-6/24/2019
2695Ah, time to post again .... Still posting after years here on this thread: Worswick16/16/2019 By Pam Martens: March 24, 2019 ~ The Office of the Compggersh23/25/2019
2693After "Irreparable Damage" Warnings, Wall Street Finally Cracks Down OWorswick23/6/2019
2692Ah, here we re again with previously unknown problems now unhappily marching forWorswick210/10/2018
2691The ongoing now pervasive world wide unraveling ... First the nonsense of ChinaWorswick19/24/2018
2690At Jesse's Cafe This op-ed is total rewrggersh-9/9/2018
2689When I click on your link, it brings me back to the SI post. With a pdf link at bruiser98-8/6/2018
2688Martin Armstrong made some very good points a few days ago. The excessive amouncarranza2-8/6/2018
2687Agree, the public only has time for their Iphone sadly nothing else matters ggeggersh-7/30/2018
2686Well that is something to wake the nearly comatose isn't it? We seem to be Worswick-7/30/2018
2685We've reached the quad mark? the leap from tril to quad, at the speed of ligggersh17/25/2018
2684Great interview, thanks for posting it.Sam-6/24/2018
2683 Paul Tudor Jones: Here's why the 1987 crash was an accident wWorswick26/24/2018
2682Heavens a dead thread! Worswick16/7/2018
2681Six months since I've posted .... as the world turns When This Debt BubbleWorswick29/20/2017 The swamp that can’t be drained without causing explosionggersh-5/13/2017
Previous 25 | Next 25 | View Recent | Post Message
Go to reply# or date (mm/dd/yy):