Just when you think the fictional economy cannot get any worse, we get this. The Cap & Trade is based on a new derivatives market. Oh gee! Just what the nation needs, yet another fictional mathematics market so a few traders can put the entire global economy at risk!
The banks are preparing to do with carbon what they’ve done before: design and market derivatives contracts that will help client companies hedge their price risk over the long term. They’re also ready to sell carbon-related financial products to outside investors.
Masters says banks must be allowed to lead the way if a mandatory carbon-trading system is going to help save the planet at the lowest possible cost. And derivatives related to carbon must be part of the mix, she says. Derivatives are securities whose value is derived from the value of an underlying commodity -- in this case, CO2 and other greenhouse gases.
Guess what this altruistic market value is? Between $300 billion to $2 trillion. We noted earlier the plan to create a new derivatives market with Cap & Trade. This post has many details, including legislation on what's going on under the guise of helping the environment.
Meanwhile, Naked Capitalism is plain calling Cap & Trade a Scam.
Gets better. Zero Hedge has an alarming post, Woman Who Invented Credit Default Swaps is One of the Key Architects of Carbon Derivatives, Which Would Be at the Very CENTER of Cap and Trade. Zero Hedge also has many posts about Cap & Trade being a scam.
Don't you love it when big finance manipulates your desire for a cleaner planet, all under the guise of making a buck. Read the above posts, for even global warming experts say this isn't going to do a damn thing but enrich our favorite scam artists, those huge financial institutions who brought you the financial crisis of 2008.