What are derivatives? Actually my eyes cross (figuratively) when I try to understand these investment instruments but here goes, an FAQ from the ISDA International Swaps & Derivatives Association: http://www.isda.org/educat/faqs.html#1
If you are so inclined, here is the concept release presented by Brooksley Born to the committee. Referred to in The Warning video, it is a “heavy” read, but for the more ambitiously curious, enjoy: concept release http://www.cftc.gov/opa/press98/opamntn.htm
Long Term Capital Management: Maybe the FIRST bailout? But this one was handled with “Big Bank” money, NOT American taxpayer dollars. Fourteen (14) banks would pony up* money to bailout out LTCM. LTCM long term capital management year 1998 http://www.pbs.org/wgbh/pages/frontline/warning/themes/ltcm.html?utm_campaign=videoplayer&utm_medium=fullplayer&utm_source=relatedlink
* pony up. Dictionary.com. Dictionary.com Unabridged. Random House, Inc. http://dictionary.reference.com/browse/pony up (accessed: July 09, 2015).
I hope you have your seat belt secured, I never cared for the roller coaster at the amusement park but the ride that Americans have had so far is like the most dangerous and yet exciting coaster one could ride! Remember that Brooksley Born warned the Federal Reserve etal. in 1998. This was ten (10) years before the housing bubble burst in 2008. One could say the “best” is yet to come, I truly hope that we have seen the worst of it in year 2015.