You've heard of the . Our financial system is a gigantic . Every day, there are newer and crazier cons.
I will describe what a derivative is: a bet. Yes, after you deconstruct a derivative, it is merely a bet. Like the shell game, assets are hidden under layers of hidden assets. What the article is talking about here is a derivative of many other derivatives.
Many years ago, mutual funds were born. That was essentially a derivative: a fund consisting of multiple stocks. This allowed you to bet on those stocks. Now you have ETFs. These are derivatives too. They trade like stocks. You have . These allow you to bet on the weather. The interesting thing with these, is you can cheat by modifying or weaponizing the weather. But I digress...
The article talks about the ultimate derivative by essentially aggregating all the other derivatives and creating one gigantic derivative. Simply consider that there is more money tangled up in derivative contracts than in stocks themselves. We're talking about multiple trillions of dollars in derivative exposure. Take a look at alone. I can't even imagine what will happen when Deutsche bank has to unwind their derivative exposure. Truly frightening.
You've heard of the [shell game](https://startpage.com/sp/search?query=shell+game). Our financial system is a gigantic [shell game](https://startpage.com/sp/search?query=shell+game). Every day, there are newer and crazier cons.
I will describe what a derivative is: a bet. Yes, after you deconstruct a derivative, it is merely a bet. Like the shell game, assets are hidden under layers of hidden assets. What the article is talking about here is a derivative of many other derivatives.
Many years ago, mutual funds were born. That was essentially a derivative: a fund consisting of multiple stocks. This allowed you to bet on those stocks. Now you have ETFs. These are derivatives too. They trade like stocks. You have [weather derivatives](https://startpage.com/sp/search?query=weather+derivatives). These allow you to bet on the weather. The interesting thing with these, is you can cheat by modifying or weaponizing the weather. But I digress...
The article talks about the ultimate derivative by essentially aggregating all the other derivatives and creating one gigantic derivative. Simply consider that there is more money tangled up in derivative contracts than in stocks themselves. We're talking about multiple trillions of dollars in derivative exposure. Take a look at [Deutsche bank](https://startpage.com/sp/search?query=db+derivative+exposure) alone. I can't even imagine what will happen when Deutsche bank has to unwind their derivative exposure. Truly frightening.
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