in general i find the discourse here has, over the years, become more fragmented, and less theoretical. early on, there were long discussions that eventually established a set of shared understandings. i think, in particular, of finster and his incredibly shrinking tape measures, and how what seemed obvious about his inflation harangues eventually penetrated deeper into my thinking than i had realized possible.

now that the credit bubble has burst, at least that part expressed in the housing securitization market, and incipiently in the sovereign debt market, i think that the area we have yet to explore is the derivatives market. i remember being short jpm for a while, with the thought that its derivatives exposure would lead to a great conflagration triggered by the housing collapse. but it was not to be.

the relationship of interest rate derivatives to the huge flows in the currency market perhaps has some relevance to kapoom theory, but the derivatives world is too opaque - to me at least - to say much about it.

perhaps there are members here who can shed some light on the this set of issues?