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What I heard Jon Stewart say last night about a Blackstone credit default swap scam was about the most repulsive thing I've ever heard. Considering what credit default swaps have already done to this nation and the entire world, comedy news is not where the story belongs.

This outrage begins with an October 22nd story in Bloomberg Blackstone Unit Wins in No-Lose Codere Trade: Corporate Finance. Weeding out the Jon Stewart's comedy because there is nothing funny about financial weapons of mass destruction, somewhere between "but did you know that they also don't go to jail for things that should be illegal but for some reason are not at all illegal" and a few laugh lines, this is the way he put it;

Earlier this year Blackstone bought something called a credit default swap on debt that Codere owed to a third party. Which means Blackstone would make money if Codere blew a lone payment to the other guys. So far, so good.

Then a short time later Blackstone offers Codere a $100 million loan with the condition that Codere pay the other loan to the other company late. The loan Blackstone had already bet that they would in fact pay late.

So Blackstone loans $100 million. Codere deliberately pays the other loan two days late. A credit default swap is triggered and Blackstone collects $15 million in insurance money.

Then Jon Stewart compared it to a scene for Goodfellas where it would actually be illegal and got a few more laughs before the rest of the segment. The rest was Samantha Bee investigating how the financial media is not covering these legal stick up artist. It wasn't about how extremely high end gamblers who had managed to bring this nation to their knees by betting against the house are still allowed to place bets against corporate loans where they have no other interest whatsoever.  

I guess it really matter to some that The New York Times didn't cover this insurance scam. Since Bloomberg is financial media I wasn't all that impressed by the lack of media claim. We don't need news, we need protection and regulation. After all the pain and suffering caused to this nation by credit default swaps I only have one question. Who the fuck is running this country and why is a clear cut case of insurance fraud still legal?

This is not about bankers hedging against their own loss but after the giant bailout and the regulations that followed, they are still allowed to gamble on losses where they have no interest other than making large amounts of money betting on a default. How could they ever convince elected officials that such transactions should still be legal? Perhaps they use the same lingo as Goodfellas "Here have a taste."

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