That is how Warren Buffet defined derivatives back in 2003 in his famous and plain-spoken “annual letter of shareholders” excerpts which was published by Fortune Magazine and quoted by BBC News in their article Buffet Warns on Investment Time Bombs. Up until 2007 only very few people actually knew what a derivative was. But even now many have heard of that word but very few actually know what it means.

Derivatives are weapons used against us to destroy us financially. But in the hands of the gunmen, the elites, it is a tool of mass wealth creation out of nothing. A general definition of a derivative is, “A substance that can be made from another substance.” For example, an orange juice is made of oranges, therefore orange juice is a derivative of orange. My blogs and articles are derivatives of me.

One easy definition to understand what a financial derivative is, is summed up in the following sentence that I read in the book Conspiracy of the Rich by Robert Kiyosaki.

One definition of a financial derivative is having a value from an underlying variable asset.

A derivative only has a value because of the underlying asset. By itself, it is nothing. One easy example for this is money. Money is a derivative of gold. That is if it is backed by gold. When Nixon took the greenback off the gold standard, the paper money that is sitting their in your bank accounts or wallets, would really be worth only the paper it is written on. However, today the US dollar is still a derivative of something. It is a derivative of debt.

Today you see all America is being taught to work hard and earn money, save some and invest some in stocks or mutual funds. What Americans are not taught is that all those are only tools the elites are using to rob you off your financial health. They are weapons used for mass destruction – YOUR destruction.

Here is why. A common share of stocks is a derivative of a company. The funds of it is a derivative of stocks. Mutual fund is a derivative of the funds. Now when there is too many derivatives created out of another derivative that is created of another derivative that is created of another derivative and so on, the investment becomes toxic and volatile. People who start investing in derivatives of derivatives of derivatives, they are easy target of a financial destruction.

In 2003, before the market collapse in 2007 – 2008, the derivatives market exploded. The future sounded promising for inexperienced investors because millions of dollars worth of investments were being sold by banks to clients. But Warren Buffet, currently the number 9 richest man of all time according to AskMen.com, did not agree.

Mr Buffett argues that such highly complex financial instruments are time bombs and “financial weapons of mass destruction” that could harm not only their buyers and sellers, but the whole economic system.

Learn more how derivatives were used to bring this economic meltdown into our world today. Click here.

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