Wednesday, October 15, 2008

Half a quadrillion dollars

The number $530 trillion is getting bandied about as an estimate of the size of the derivatives market. We are now in figures normally reserved for astrophysicists.

Today's Washington Post makes the astonishing claim:

The global derivatives market topped $530 trillion as of June 30 this year, including $55 trillion in the suddenly popular credit-default swaps; that $530 trillion represents all contracts outstanding. The total dollars at risk is a much smaller, but still a hefty $2.7 trillion, according to an estimate by the International Swaps and Derivatives Association.

UPDATE: Slate has an article in the explainer (using $596 trillion!). I still don't understand.

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