kevyn: (meme)
( Nov. 12th, 2008 12:49 pm)
The economic collapse continues. We've been through the housing mortgage bubble bursting. We're still weathering the meltdown of the financial services market.

Now here comes the credit card implosion. The Wall Street Journal is reporting that American Express is the first to come, hat in hand, to the taxpayers for a bailout:

American Express seeking $3.5 billion as part of government bailout program

One excerpt from the article really made me sit up and take notice:

"American Express relied on packaging pools of credit card debt and selling them to investors in the securitization market. As investors have shied away from purchasing all but the safest forms of debt, the market for credit card-backed securities has dwindled."

Sound familiar? It should. It's exactly the same thing that led to the mortgage meltdown: bundling debt -- especially bad debt -- and selling it as financial derivative products.

We are so screwed.

Keep your seat belts fastened and your hands inside the cart at all times, until the ride comes to a complete halt, and enjoy the rest of your visit to Disneyland.
.

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