This was a very interesting book about how the mortgage backed security and credit default swaps.  These methods of banking and investing were very interesting and made these huge webs of reliance.  Once one part of the web broke all the others were start breaking.  The idea behind these monetary devices was that if you create something and make it seem secure, but then let people know that it may not be as secure as it looks at first in the small print, you can sell it for much more than it will eventually be worth and externalize that risk.  If the buyers of these items had just been people there wouldn’t have been a banking crisis, it would have just hit all the wealthy individuals that had bought them and all the people who had taken loans they couldn’t possibly pay back.  This would have meant that no bailout would have occurred.  Somewhere along the line the banks and investment firms thought that these investments were a great idea and that they were missing out on the money.  Once that happened the market became larger and the interdependencies started to accrue.  Then the monetary devices started to wilt and all hell broke loose.  This makes me think that if you can create a monetary device that seems stable on the surface but is really just a front for a lot of unstable things that you can make an insane amount of money.

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