derivatives

what is a Derivatives & how does it relate to the Housing market?
Q. I barley understand what this is. I found what it mean's on a few websites. However I can not comprehend them. I want to explain Derivatives and how it affected the housing crises to my son.
Asked by czyszczon - Fri Apr 23 08:36:42 2010 - - 1 Answers - 0 Comments

A. If a bank loans you $100,000 for a home loan, it is a "security" instrument. You owe them money each month. If you don't pay, the bank has the security of taking your house from you in a foreclosure. Each month the bank receives the entire mortgage payment. It is possible for the bank to divide that $100,000 loan into 10 parts. Then they sell $10,000 worth of that home loan to 10 different investors. Each of those people does not own a "loan" on a house. They own a "derivative" of that loan.
Answered by Ed Atun - Fri Apr 23 18:53:25 2010

How are asset trades and dividend payments are related to derivatives?
Q. Hi folks, I need help for the question in the subject? Can you give samples of that question? What other transactions related to derivatives? How are they related to derivates? Thank you.
Asked by firstquality72 - Sun Apr 12 12:59:14 2009 - - 1 Answers - 0 Comments

A. Derivatives are legalized gambling. All derivative trades are asset trades of some sort. I would not trade a derivative if I did not think it had some sort of value to me. Even a worthless derivative will be on the balance sheet as an asset even though its market value can be different then it's notional value. I took an entire semester on these and they are almost impossible to explain. The asset trades I think you are talking abotu are something simple like an interest rate swap they are very popular probably because they are the easiest to understand. These are the only ones I have actually worked with in real life an dthey are a pain to account for. Because they are highly liquid you can account for some as if they were cash. … [cont.]
Answered by Jon S - Sun Apr 12 13:29:45 2009

What is the real life meaning of the third and the fourth derivatives?
Q. I mean we always talk about only the 1st and the 2nd derivative. I mean we use those two often. But can anyone explain me the real life meaning of the third and fourth derivatives or what actually they represent and helps us to figure out?
Asked by Ayan - Tue Feb 7 02:07:18 2006 - - 2 Answers - 0 Comments

A. Life it has a meaning and loving purpose - you just have to find your purpose and live it. I believe every person is here for a definite purpose. Each person is special and valuable; that refers to me, you, your family, friends, in fact everybody! There is a loving plan for each of our lives here on earth and there is no such thing as coincidence. I don't believe that anything in life happens by chance and that every aspect of our lives points to something deeper. You need to decide now to live for God rather than for yourself. You spend your life on Earth preparing yourself (as best you can) for death. I don't see death as a scary, negative experience, but birth into a bliss filled eternal life with God. I believe that this is… [cont.]
Answered by France - Mon Feb 13 16:18:11 2006