Buffett's "time bomb" goes off on Wall Street - New England Patriots Forums

***weswelker#83*** · 09-19-2008, 09:07 AM

On Wall Street, specialized insurance known as a credit default swaps are turning a bad situation into a catastrophe.

When historians write about the current crisis, much of the blame will go to the slump in the housing and mortgage markets, which triggered the losses, layoffs and liquidations sweeping the financial industry.

But credit default swaps -- complex derivatives originally designed to protect banks from deadbeat borrowers -- are adding to the turmoil.

Five years ago, billionaire investor Warren Buffett called them a "time bomb" and "financial weapons of mass destruction" and directed the insurance arm of his Berkshire Hathaway Inc to exit the business.

FULL ARTICLE:
Buffett's time bomb goes off on Wall Street | U.S. | Reuters

PatriotsReign · 09-19-2008, 11:09 AM

Quote:

Originally Posted by weswelker#83

On Wall Street, specialized insurance known as a credit default swaps are turning a bad situation into a catastrophe.

When historians write about the current crisis, much of the blame will go to the slump in the housing and mortgage markets, which triggered the losses, layoffs and liquidations sweeping the financial industry.

But credit default swaps -- complex derivatives originally designed to protect banks from deadbeat borrowers -- are adding to the turmoil.

Five years ago, billionaire investor Warren Buffett called them a "time bomb" and "financial weapons of mass destruction" and directed the insurance arm of his Berkshire Hathaway Inc to exit the business.

FULL ARTICLE:
Buffett's time bomb goes off on Wall Street | U.S. | Reuters

The man is a great American. He cares more about the welfare of our nation than he does about making money...wow! what a concept! All corporations should be forced to abide by such motives.