When, for whatever reason, the Federal Reserve allowed banks to hold trillions of dollars in derivatives trades "off the books," they created the monster that took our financial system down.
Banks still hold trillions of dollars in derivatives off the books and the Fed is doing nothing about it. All the Fed wants to do is to demand that banks trade derivatives though a clearinghouse. That's a first step, but it doesn't remove the bag of losses that banks are still holding.
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