"It is time to break the silence on derivatives," Lyndon LaRouche said yesterday, after observing the carnage in the financial system and the pathetic response from the so-called regulators. "The true, hyperinflationary factor in the situation is the unregulated, insanely leveraged derivatives trade. This is what is killing us. This is the great crime of Alan Greenspan."
LaRouche described the derivatives market as a "hyperinflationary bomb, crushing the international financial system," warning that "Until you just shut down the whole derivatives trade--wipe these gambling obligations off the books of the financial system--you are just kidding yourself."
"Unless and until you deal with this derivatives bubble, which cannot be bailed out, you are just kidding yourself," he continued. "It is time for Hank Paulson to swallow the only real medicine: bankruptcy reorganization of the entire, dollar-based financial system. And the first step in any such bankruptcy reorganization would be the cancellation of these quadrillions of dollars in pure gambling obligations. Without such action, this planet is doomed to a horrible dark age, just like the dark age of the fourteenth century, that followed the collapse of the Lombard banking system."
Blood In The Streets