{"id":8474,"date":"2015-05-26T06:07:42","date_gmt":"2015-05-26T11:07:42","guid":{"rendered":"http:\/\/olduvai.ca\/?p=8474"},"modified":"2015-05-26T06:07:42","modified_gmt":"2015-05-26T11:07:42","slug":"is-the-505-trillion-dollar-interest-rate-derivatives-bubble-in-imminent-jeopardy","status":"publish","type":"post","link":"https:\/\/olduvai.ca\/?p=8474","title":{"rendered":"Is The 505 Trillion Dollar Interest Rate Derivatives Bubble In Imminent Jeopardy?"},"content":{"rendered":"<h3><a href=\"http:\/\/theeconomiccollapseblog.com\/archives\/is-the-505-trillion-dollar-interest-rate-derivatives-bubble-in-imminent-jeopardy\" target=\"_blank\">Is The 505 Trillion Dollar Interest Rate Derivatives Bubble In Imminent Jeopardy?<\/a><\/h3>\n<p>All over the planet, large banks are massively overexposed to derivatives contracts.\u00a0 Interest rate derivatives account for the biggest chunk of these derivatives contracts.\u00a0 According\u00a0<a title=\"to the Bank for International Settlements\" href=\"http:\/\/www.bis.org\/statistics\/dt1920a.pdf\" target=\"_blank\">to the Bank for International Settlements<\/a>, the notional value of all interest rate derivatives contracts outstanding around the globe is a staggering 505 trillion dollars.\u00a0 Considering the fact that the U.S. national debt\u00a0<a title=\"is only 18 trillion dollars\" href=\"http:\/\/theeconomiccollapseblog.com\/archives\/it-is-mathematically-impossible-to-pay-off-all-of-our-debt\">is only 18 trillion dollars<\/a>, that is an amount of money that is almost incomprehensible.\u00a0 When this\u00a0<a title=\"derivatives bubble\" href=\"http:\/\/theeconomiccollapseblog.com\/archives\/tag\/derivatives\">derivatives bubble<\/a>finally bursts, there won\u2019t be enough money in the entire world to bail everyone out.\u00a0 The key to making sure that all of these interest rate bets do not start going bad is for interest rates to remain stable.\u00a0 That is why what is going on in Greece right now is so important.\u00a0 The Greek government has announced that it will default on a loan payment that it owes to the IMF on June 5th.\u00a0 If that default does indeed happen, Greek bond yields will soar into the stratosphere as panicked investors flee for the exits.\u00a0 But it won\u2019t just be Greece.\u00a0 If Greece defaults despite years of intervention by the EU and the IMF, that will be a clear signal to the financial world that no nation in Europe is truly safe.\u00a0 Bond yields will start spiking in Italy, Spain, Portugal, Ireland and all over the rest of the continent.\u00a0 By the end of it, we could be faced with the greatest interest rate derivatives crisis that any of us have ever seen.<\/p>\n<p>The number one thing that bond investors want is to get their money back.\u00a0 If a nation like Greece is actually allowed to default after so much time and so much effort has been expended to prop them up, that is really going to spook those that invest in bonds.<\/p>\n<p>&#8230;click on the above link to read the rest of the article&#8230;<\/p>\n","protected":false},"excerpt":{"rendered":"<p>Is The 505 Trillion Dollar Interest Rate Derivatives Bubble In Imminent Jeopardy? All over the planet, large banks are massively overexposed to derivatives contracts.\u00a0 Interest rate derivatives account for the biggest chunk of these derivatives contracts.\u00a0 According\u00a0to the Bank for International Settlements, the notional value of all interest rate derivatives contracts outstanding around the globe [&hellip;]<\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"closed","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_monsterinsights_skip_tracking":false,"_monsterinsights_sitenote_active":false,"_monsterinsights_sitenote_note":"","_monsterinsights_sitenote_category":0,"footnotes":""},"categories":[2],"tags":[1733,1269,195,1668,5698,4899,281,1167,418,5699,431,434],"class_list":["post-8474","post","type-post","status-publish","format-standard","hentry","category-economics","tag-bank-for-international-settlements","tag-bis","tag-debt","tag-derivatives","tag-derivatives-bubble","tag-economic-bubble","tag-europe","tag-greece","tag-imf","tag-interest-rate-derivatives","tag-interest-rates","tag-international-monetary-fund"],"_links":{"self":[{"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/posts\/8474","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/olduvai.ca\/index.php?rest_route=%2Fwp%2Fv2%2Fcomments&post=8474"}],"version-history":[{"count":1,"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/posts\/8474\/revisions"}],"predecessor-version":[{"id":8475,"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/posts\/8474\/revisions\/8475"}],"wp:attachment":[{"href":"https:\/\/olduvai.ca\/index.php?rest_route=%2Fwp%2Fv2%2Fmedia&parent=8474"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/olduvai.ca\/index.php?rest_route=%2Fwp%2Fv2%2Fcategories&post=8474"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/olduvai.ca\/index.php?rest_route=%2Fwp%2Fv2%2Ftags&post=8474"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}