Capitalism's latest pastime - Waiting for your grandfather to die

They drove the plane into the ground last year, but America's Capitalists have found a new favorite game: buying up life insurance policies from the old and near death and betting that the policy holders will die. Reported in this article in the Times the main idea of this money making plan will be to offer those desperate and close to death a large sum of money for the rights to payoffs from life insurance when they die. Picture a team of Wall Street bankers standing around Grampa's bed, flipping coins and smoking cigars in their fancy suits, trying to convince your family its time to pull the plug and make good on their payoffs. If you were concerned that Capitalists were bored now that their party in the mortgage market has ended, this new game, backed up by the certainty of death, will alleviate your fears.

But despite the assurance of our mortal fate, this latest design is apparently no less risky - if infinity more morbid - than schemes of the past. Evidently the investors' bets will be threatened by the unfortunate occurrence that 1) improvements in health care and quality of life for the elderly will increase life spans and delay the flow of death money 2) discoveries in medicine will cure diseases like AIDS and Cancer allowing the investments to literally get up and walk away from the capitalist's greedy fingers 3) public health insurance will make people less desperate to exchange life insurance policies for cash up front because they will no longer need to dig up their savings in in order to afford health care.

But if you are afraid that these horrible series of events could sink the capitalists, then worry no further because the risks have spawned all kinds of new innovations:

The solution? A bond made up of life settlements would ideally have policies from people with a range of diseases — leukemia, lung cancer, heart disease, breast cancer, diabetes, Alzheimer’s. That is because if too many people with leukemia are in the securitization portfolio, and a cure is developed, the value of the bond would plummet.

Its great that the investors can spread the risks of their gamble among many routes to death and they can be sure that we will not cure all the worlds fatal diseases at once! Thank innovation of the free market because without the constant push for a new capitalist edge, we might just save the world.