Buffett's time bomb goes off on Wall Street | U.S. | Reuters

Buffett's time bomb goes off on Wall Street | U.S. | Reuters: "credit default swaps are turning a bad situation into a catastrophe"

I always thought these were a bad thing. They can't easily be understood and are just asking for trouble.

"This is the derivative nightmare that everyone has been warning about," says Peter Schiff, the president of Euro Pacific Capital at the author of "Crash Proof: How to Profit From the Coming Economic Collapse."

"They booked all these derivatives assuming bad things would never happen. It was like writing fire insurance, assuming no one is ever going to have a fire, only now they're turning around and watching as the whole town burns down."