Credit Default Swaps and Option ARMS: A Killer Kombo.

Greetings...

As you might guess, your author has become a total financial junkie.

The reason is simple... I fear that we are headed towards Judgment Day.

With every bailout, bankruptcy, and foreclosure, we as a nation are walking through the minefield like a blindfolded, stone-cold drunk Wino.

We have no idea. Our Money Masters have no idea. Our politicians (except for Dr. Ron Paul) are more than useless.

We're fucked.

With that bit of positive news out of the way, there are three important articles I would like you to read, as they are all interconnected.

First up, please click here to read about AIG and the Brave New World of Credit Default Swaps (CDS).

It is thoroughly chilling, and absolutely likely that we will inadvertently step on a CDS landmine that not even Fedgov can fix without...

...printing (monetizing) massive amounts of debt. Indeed, according to AFS, the U.S. Treasury is selling 40 billion worth of bonds in order to help the Federal Reserve, a private central banking cartel repair the damage done to its balance sheet in the course of bailing everybody and their momma out, in addition to accepting toxic debt from a multitude of institutions.

Now, if the Fed, or the Treasury begins, this early in the game, to create massive amounts of money and credit to finance rescue operations for insolvent banks (like Washington Mutual, for example) and finance companies...

... imagine how insane things are going to get when the REAL mortgage crisis gets underway!!

In summary...

Please read the referenced material. I believe that if you do so, you will clearly understand what's at stake here.

My nightmare scenario goes like this...

Some direct or indirect financial complication is going to trigger a derivatives mega-event that only Fedgov (since they are the only ones with the power to create new money and credit) can handle. It will most likely occur as a bank or major financial house, crippled by the horrendous spike in defaults and foreclosures that will take place in 2009, will cause a chain reaction of derivatives obligations to be incurred that will force the government to act.

When this extinction level event takes place, it will deplete the reserves of the Fed and of the government bodies involved, (such as the FDIC) which will force the government or the Fed to create money and credit on an impossible scale.

This printing will trigger hyperinflation at worst, or seriously damage the country's economic rating on the world markets at the minimum. Once either of these occurs, its all downhill from there.

So will events transpire as I think they will??

Let's hope not. But in any event, these are the things you need to know, think about, and seek a qualified financial adviser to prepare for... in order to insure your and your family's economic survival.

One Love.