Citigroup Offers New "Pick Pocket" Derivative

According to trade magazine RiskNet, "specialists" at Citigroup are considering launching the first derivatives intended to pay out in the event of a financial crisis. These types of derivatives function like an insurance policy, allowing parties to hedge against risk. "I believe it will reduce the systemic risk in the industry, akin to how the advent of swaps means people don't worry about interest-rate exposures any more -- they just pay a fee to hedge it," said a Citi spokesperson. In truth, such a derivative is only as good as the institution selling it. Fancy derivatives called "credit default swaps" sold by AIG were critical to bringing down the global economy in the 2008 crisis. Citi is a zombie bank with boatloads of bad assets on its books. Because it is "too big to fail" and has been bailed out over and over again by the American taxpayer, it is betting that taxpayers will come to the rescue again during the next crisis and make good on these derivatives. So let's call these derivatives what they are: "pick pocket" derivatives. Citi is kindly offering to pick the pocket of the American taxpayer in the eventuality of a new financial crisis.