Public Bottomless How To Explain This To The General Public, In Layman's Terms?

How to explain this to the general public, in layman's terms? - public bottomless

The explanation of the credit crisis (by Ben Stein)

The crisis has occurred) to simplify (clearly, because the system enables financial institutions to Paris, whether the mortgage was paid never occurred. You still have to make a mortgage to Paris. These paris, called credit default swaps are complex. But in sum, that someone will benefit immensely - surprisingly - when a large number of subprime mortgages are not paid and subsequently allows.

The benefits can be fully combined in proportion to the actual number of defaults, because speculators can reduce the price of instruments for the subprime mortgage beyond what was the actual rate of loss. As I said earlier, the advantages here is beyond imagination. (In fact, it may be so large that one wonders if the whole subprime fiasco was not created solely in order speculators profit wildly on its collapse ...)

Credit default swaps written written credit was (like insurance) is as private contracts. There is no government regulation of them. Who writes these policies? Banks. Investment banks. Insurance. Now, should the buyers of credit default swaps on junk mortgage debt trillions of dollars. This responsibility is the abyss of the responsibility for the financial institutions in America.

As these companies never dreamed that the financial giant subprime securities as they fall, not a potential liability for these CDS policies give you somewhere near their true liability - which could in turn, is almost bottomless. You do not have a countervailing asset to pay the debt.

That would never happen. Now, that has already occurred, should the taxpayers pay for speculators millionaires through its paris? What the hell are we to do?