Forget about any idea of sub-prime mortgages and other types of toxic waste being the cause of the current meltdown. The real story is the derivatives market, and to understand why, look carefully at the statistics below:
According to the U.S. Comptroller of the Currency (OCC), on June 30, 2008, U.S. commercial banks held $182.1 trillion in notional value (face value) derivatives.1 And, according to the Bank of International Settlements (BIS), which produced a tally six months earlier for the entire world, the global pile-up of derivatives, including institutions in the U.S., Europe and Asia, was more than three times larger – $596 trillion.2
That was ten times the gross domestic product of the entire planet – more than 40 times the total amount of mortgages outstanding in the United States – nearly 60 times greater than the already-huge U.S. national debt.
Citigroup collapses! Banking Shutdown Possible
by Dr. Martin D. Weiss
That is also why there is no simple cure for this collapse other than abandoning the usurious thinking and practice that brought it about.