Billionaire Eric Sprott Just Made One Of The Most Dire Predictions Of 2015Today billionaire Eric Sprott warned King World News that massive derivatives losses have already taken place and they are currently being hidden from the public. He then issued one of the most dire predictions of 2015.

Eric King: “What is going to trigger the disaster that brings the world back to reality?”

Sprott: “There is no doubt in my mind that we are in the disaster. It is a disaster when a currency falls by 30 percent. These things that are going on are absolutely insane….“The biggest issue is what’s happening in the derivatives market. It’s just staggering to think that we have one quadrillion dollars of derivatives.

Look at the chaos. You have no idea what’s going to happen to a currency the next day. Brazil’s currency is crashing. We’ve had oil fall (over) 50 percent and various other commodities have collapsed. Bond yields have gone up today, so some guy who is levered long the bonds — he’s getting killed today. There has to be a lot of hurt going on out there.

I don’t even know if we will ever see it (the enormity of the financial destruction), Eric, because of these changes in accounting policies. The FDIC is supposed to take care of derivative losses at major banks. This was passed in a recent resolution by Congress. We may not see it manifest itself because they (major banks) don’t have to mark-to-market. But any sane person has to know what’s going on.

You can’t have one quadrillion dollars on either side of a market and nobody is losing money. Somebody is losing money and the amounts are way beyond anyone’s ability to pay. So that would be my biggest fear here — that there have to be some huge losses being taken. For example, when Switzerland abandoned the (currency) peg, some hedge fund that had $850 million in it got wiped out in a day. The leverage that’s out there is just staggering and that’s just one example.

And someday there is going to be a claim on some entity where that bank will not be able to honor the claim. Nobody has any idea what’s going on in these banks with their huge derivatives positions. Nobody knows what’s happening. Full Story