$60 trillion in derivatives?

[John K. Taber]

Doug Henwood wrote:
> 
> Greg Nowell wrote:
> 
> >How do we get $60 trillion in derivatives in a world
> >economy with total GNP of $22 trillion?  Let's not get
> >overblown, here.
> 
> According to the May 1998 ish of the BIS's International Banking &
> Financial Market Developments, there were $19.2 trillion in interest rate
> swaps outstanding worldwide, and $1.6 trillion in currency swaps, both as
> of December 1996. As of December 1997, there were also $7.8 trillion in
> exchange-traded futures and $4.4 trillion in exchange-traded options. (The
> August issue is out, but the print copy hasn't arrived, and I'm too lazy to
> get it from their website.) That's, what, $33 trillion? Of course, the
> amounts refer to "notional principal" - like the full face value of the
> principal in an interest-rate swap, when the cash at risk is really the
> difference between the two interest streams.
> 
> Doug

This is confusing me. I thought that if things went wrong, and far
enough, the holder of a swap could in worse case be responsible for
the notional amount.

Am I wrong?