Credit Default Swaps

Credit Default Swaps

The idea of credit default swaps was that an insurance policy could be bought so that if a stock went down, the insurance policy would cover the loses.

The idea of all insurance is that if something bad happens the insurance policy will pay for the cure for the problem.

The assumption of every type of insurance is that only a small fraction of the stocks will go down, or that only a small fraction of the people have a problem.

The Economic Disaster of 2008 has proven insurance does not work if a large fraction of the stocks go down. Insurance will not work if a large fraction of the people expect to get anything from insurance.

Insurance and socialism are closely linked, because they are a way to avoid personal responsibility. You can take a greater risk if you have the safety net of insurance.

People must return to personal responsibility.

The best way to achieve personal responsibility is by following Christian Principles, but that requires accepting Jesus Christ as Lord/Savior and committing to following the commandments/doctrines of the Bible.