Rosen makes the statement that WMI held no MBS, and that they were all sold off to GSE's....ergo, WMI held no derivative contracts.....in addition, before the 2008 financial crisis, Brooksley Borne, attended a meeting with Alan Greenspan, in which she foretold of an eminent crisis in the UNREGULATED MARKET for CDS, as well as other derivative trades being done outside the purview of government regulations.... said another way: derivatives was a form of INSURANCE against losses from failed CDS, but WAS NOT BEING REGULATED BY ANY GOVERNMENT AGENCY....ERGO NOT ENFORCEABLE IN CASE OF LOSSES!!!!!!!....these derivatives were sold in the market by the CBOE as options contracts: said another way: the buyer , or seller of these contracts had avenues to mitigate losses by buying or selling out the contracts....in no way was the U.S. government responsible for losses in Derivative contracts....AIG was the chief seller, or buyer of these contracts, and as you may be aware, the TARP program had to "bail them out" when they sustained huge losses on their contracts.... said another way:.. AIG could not pay off on the counterparty contracts.....my point?.... Brooksley Borne was removed from the meeting between Greenspan, and Larry Summers as being a quack, and dismissed... what followed was the 2008 financial crisis when the MBS started to lose value, and the roof caved in....so, the US government funded TARP, settled all the derivative contracts of AIG, and cleaned up the losses on the Banks books, and the US economy took off again in 2010... as a sidenote, the US government DID NOT LOSE ONE DIME, AS ALL THE TARP MONEY WAS EVENTUALLY PAID BACK.... thanks Obama....... Lodas
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