if you deregulate these guys who are using public money and credit

THat is the definition of a "deregulated" regulated non-free-market.

Derivatives are financial tools used to minimize risk to a given of various underling financial products. Their "success" or popularity seems intimately associated with and dependent on massive credit expanding policies of the Fed, massive degrees of overleverging principle with a good a top heavy inverted pyramid scheme that also requires is helped along by the complex nature of the instruments themselves that effectively allows them to be traded and valued in opaque.

From Russ Roberts recent Econtalk, a Stanford Econ expert expresses some concern as well… I'm not alone methinks but I bet in a year or two you will likely be even more in isolation if you continue to defend the practices on Wall Street that have brought us to this brink. You want to derivative on it… I mean do you want to bet on that.

" Under the surface, some unusual happenings that would make anyone worry. Look at financial system, at 3-month bank lending to each other, unusually high. Suggests banks are worried about lending to each other, unusual risk factor. Due to the fact that there are unusual securities out there, mortgage obligations that people don't know how to assess their value. If housing prices continue to fall, those securities will seem even more suspect. But how will that spread to the rest of the economy? So far, though economy is weak, it could be worse."

from EconTalk John Taylor interview.

methinks, what does he mean by, "there are unusual securities out there"?

Are you effing kidding me? I've never seen you defend anything here – nor are you discouraged when ignored. You blather about Glass-Steagall, opitons, Wall Street, Bankers, "corporatists" and assorted other garbage you don't have a clue about. When asked to defend your position you morph from Muirdiot to Muirduck and pretend you didn't see the post. And you call Russell a coward? This is humour, right?

I've read no less then 4 books that have been recommended here. I have listened to over 20 of the EconTalk interviews start to finish. Some of them I've listened to 2-3 times.

You did all that and still learned nothing? I fear for you patients.

It's glaringly clear that no one has a "good" understanding of how the economy runs and how best to run it when al factors are considered.

Sadly, that realization taught you nothing and proves Russell's point.

Posted by: Russell Nelson

Just BS. If you have such great ideas defend them instead of preaching to the choir.

I've read no less then 4 books that have been recommended here. I have listened to over 20 of the EconTalk interviews start to finish. Some of them I've listened to 2-3 times.

I've just listened to the most recent EconTalk where Russ interviewed John Taylor from Stanford on Monetary Policy. It's glaringly clear that no one has a "good" understanding of how the economy runs and how best to run it when al factors are considered. It is your lack of desire to consider alternatives that is truly set in concrete. My mind is also of a biased human being but itis far from being a closed book.

Yes Russell I have drooling vacuities but of course YOU have the truth. Coward!

Muirdiot, Do explain to us (IN YOUR OWN WORDS) what derivatives are, how they threaten the financial system, and what Glass-Steagall has to do with it.

I know you think that everyone here is as stupid as you are and that's why you insult our intelligence by repeating your inane word vomit ad infinitum in the hopes that we will fall over and agree with you from shear exhaustion. However, you're on the wrong blog for that. We require you to make a cogent argument and we don't tire easily.

Dazzle us! Go!