Economy

I also predicted it in real time and stayed months ahead of crisis as I foresaw it clear as day as it played out.

In a nut shell, I would describe it as "Make the profit but pass the risk"

These assholes thought that they were so smart that they had figured out a mathematical way to eliminate the risk. All they did was create a system that was so complicated that it gave the appearance of shedding risk while hiding the real problems.

They were essentially buying insurance in case things went sideways. They made up fancy names for it was essentially like an insurance. My perception of it is that what they were doing would have worked at the micro level the same way most insurance works. But they were all doing it and no one was asking whether it made sense at the macro level. There was extraordinary systemic risk because they were all counting on the insurance to pay off. At the end of the day, the insurers (with AIG being the biggest) didn't have anywhere near enough capital to cover all the risk that they insured.

The idiots thought they were just making the risk disappear. Which led to the reckless loaning habits. They saw profits and believed they couldn't lose. They were making loans that no one ever had a chance in hell of repaying and did not care because they were insuring the risk and selling the loans to other investors. And then they were dicing them up and selling them again and again and again. And every layer was tapping into the same insurers to make the risk disappear. I saw figures at the time that the volume of insurance vehicles written were exponentially larger than even the loans themselves because they were insuring every layer of the business. Once it went sideways, they owed everyone and were upside down immediately.

In the end, the insurance model doesn't work because it is founded on disbursed premiums covering isolated losses. But in this case, the damages were self inflicted and spread across the entire industry. It collapsed like the house of cards it was.