I mentioned the danger posed by derivatives to the world financial system in an article a couple of weeks ago. I've since had a few e-mails from people asking how the problem affects the USA specifically, and the extent of our banks' exposure to this problem. The answer is, they're at grave risk from it - perhaps so grave that no recovery is possible, absent a miracle.
The nine largest banks' exposure totals almost $229 trillion. Here's a graphic representation of the size of the problem, courtesy of Demonocracy. Each of the towers at either side of the image represents a stack of $100 bills totaling $1 trillion.
Note the little man standing in front of the white house. The little worm next to the last football field is a truck with $2 billion dollars. There is no government in the world that has this kind of money. This is roughly 3 times the entire world economy.
There's much more at the link. I highly recommend scrolling through Demonocracy's graphic portrayal of the derivative crisis. Further information may be found in two articles at the Economic Collapse Blog, which are also worth careful study.