Credit CRUNCH?

As much as I appreciate the recent flurry of activity in auditing the FED, someone needs to look at the banks that own the FRBNY. These institutions have the ability to make the books look like whatever they want. One of the key tools they use to accomplish this goal is the derivatives market. As shown in the chart below, the market is huge. That number you see at the bottom of the page is $174 trillion. That is the total notional value of all contracts held. By bank the numbers are startling. JP Morgan has total notional bets of 41 times their equity. Notional volumes are reflections of business levels. It does not appear that volumes have slowed in this contrived crisis. The amount of derivatives contracts held by U. S. commercial banks in the fourth quarter increased by $24.6 trillion, or 14%, to $200.4 trillion. Derivative values are 21% higher than a year ago.




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