Four American banks have $175 trillion of derivatives. JP Morgan, Goldman Sachs, Citibank and Bank of America don’t help in production of food, homes and industrial goods. Just “fugazi” economy.

7 comments

1. Do you know that these derivatives are how they hedge their assets (aka your savings) during downturns?

2. Most of derivatives are used to edge against risks not for speculative reasons. In addition we should look at the net position since you have derivatives in the assets and liabilities of the balance sheet that offset each others

3. Yes, WCGW

4. So what? Most derivatives expire worthless. Derivatives are just a tool to lock in a price in the future. A candy maker or coffee supplier might want to lock in a sugar price or coffee price to assure their supply. A producer might want to lock in a price for their crop to eliminate the vagaries of the market. Speculators on both sides make the market work.

5. What a BS post

6. Meanwhile I keep seeing that finance investment bros name pop up (I think he is a cfo/hier up and Jp Morgan)spouting off bout how bad stagflation is going to destroy USA’s economy. “Bitch you own most of the fucking economics and money of the entire thing!”

7. Everyone defending this as “derivatives are good and healthy!” acting like these very same companies didn’t almost destroy the entire worlds economy with speculative derivatives barely a decade ago.

   Yes, derivatives are a useful instrument in a healthy economy. But also, high amount of speculative derivatives, owned by companies with a track record of dangerous speculation, can turn a healthy economy into a teetering house of cards.

   Considering debt and labor indicators that the average person is not doing so hot right now, paired with simultaneous raging bull market, its not crazy to think were further into house of cards territory than we are into healthy financial instrument territory.