Tuesday, October 21, 2008

Untangling Credit Default Swaps

Credit Default Swaps are sort of the nuclear power of the finance world. They have the potential to be a cheap source of enormous energy but when they go bust, you get this: the financial world's version of Chernobyl:

Uncorking CDOs

Here is a second video from Marketplace that does a pretty good job of explaining the arcane world of Collateralized Debt Obligations or CDOs:

The Credit Crisis Explained

I came across these videos from Marketplace that are perhaps the clearest, simplest illustrations of the credit / financial conflagration that started on Wall Street and has now spread around the world. I never actually thought that there was any easy way to explain credit default swaps or CDOs but these guys do a pretty damn good job of it. This is the first video:


The Credit Crisis as an Atlantic Expedition