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<p>[QUOTE=&quot;InfleXion, post: 1617746, member: 29012&quot;]That number was from MarketWatch.com, and considering that in London banks can legally rehypothecate infinitely (re-loan the same debt instrument round robin between banks to balloon balance sheets adding more counter party risk each time), there is no way to accurately estimate how large the derivatives market is. The shadow banking system isn&#039;t even on the books. Whenever they need to hide a loss they just put it there and everything looks fine. Nobody except these banks themselves has any clue how big this market actually is. But you are right that it&#039;s a bunch of counter parties that will net to zero, which is all the more reason it is dangerous and a bubble, and their appearance of solvency, and thus their credit ratings and ability to borrow depends on this artificial ballooning. IMO it&#039;s unrealistic to think that a counter party chain to infinity isn&#039;t going to have a broken link somewhere. It only takes one broken link to fail the entire thing. So I don&#039;t think it matters what the size is as much as that it&#039;s a house of cards balancing on a pinhead. It&#039;s not like a card game though, because everybody gets to take home the winnings as long as nobody asks for any legitimate collateral.[/QUOTE]</p><p><br /></p>

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