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Finance - Investments Sub-forum: Non-Actuarial Personal Finance/Investing

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  #41  
Old 02-21-2012, 01:10 PM
MathGeek92 MathGeek92 is offline
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I think the chaotic that they reference is triggering CDS. CDS will be just like 2008 all over again. "Quality" writers of the CDS all of sudden become on the hook to pay... thus bringing instability back to the finance sector again.

The troika is doing everything they can to avoid any CDS triggers, whereas most of the private holders of the debt WANT the CDS to kick in, because many of them bought it!
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  #42  
Old 02-21-2012, 01:17 PM
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Quote:
Originally Posted by tommie frazier View Post
can someone spell out for me how these debt deals have avoided the "chaotic default". I get that they avoid the default (officially), but there seems to be a fair amount of chaos/riots/etc. going on.
No one in the financial system has had to acutally realize a loss, which means no realization of capital impairment, no glaring sign of insolvency, and so on. If anyone had to do that, it would be chaotic. If Greek society goes down the crapper, that's OK - it's expendable, as long as it's made clear that the duty of all parties to pay debt is paramount to the well-being of the people as a whole.

BTW, the latest gem from this agreement:
Quote:
Greece will also have to pass within the next two months a new law that gives paying off the debt legal priority over funding government services. In the meantime, Athens has to set up an escrow account, managed separately from its main budget, that will at all times have to contain enough money to service its debts for the coming three months.

These requirements, together with tighter on-the-ground monitoring, are an unprecedented intrusion into the fiscal affairs of a sovereign state in Europe and could eventually see Greece being forced to pay interest on its debt before compensating teachers, doctors and other state employees.
http://www.usatoday.com/money/world/...out/53183092/1

I can't imagine why anyone in Greece would object to something like this.
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  #43  
Old 02-21-2012, 02:31 PM
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Quote:
Originally Posted by Irish Blues View Post
BTW, the latest gem from this agreement:


http://www.usatoday.com/money/world/...out/53183092/1

I can't imagine why anyone in Greece would object to something like this.
Exactly -- this so-called deal is contingent upon the Greek government enacting basically impossible things into law. This is all just so incredibly silly. Greece will default. There are no "deals" that can prevent this.
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  #44  
Old 03-01-2012, 01:40 PM
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http://www.cnbc.com/id/46590070

I'm looking forward to the time in the near future when the remaining bondholders are offered 0.0% and it is still not deemed to be a CDS event.
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  #45  
Old 03-01-2012, 01:49 PM
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S&P considers it a selective default.

http://online.wsj.com/article/BT-CO-...27-717151.html

Of course, that doesn't rule at ISDA
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  #46  
Old 03-01-2012, 02:14 PM
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Originally Posted by campbell View Post
S&P considers it a selective default.

http://online.wsj.com/article/BT-CO-...27-717151.html

Of course, that doesn't rule at ISDA
If a default occurs, I'll be interested to see who votes which way in the ISDA commitee:

http://www.isda.org/dc/committees.html
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  #47  
Old 03-01-2012, 03:10 PM
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CDS seems like a very flawed vehicle if its payout depends on the vote of a committee, and a committee with vested interests, no less.
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  #48  
Old 03-01-2012, 05:06 PM
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Yes, that's obvious to the buyers now.
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  #49  
Old 03-02-2012, 05:03 PM
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The ISDA wins the award for having the most condescending blog in the history of the internet.
http://isda.mediacomment.org/
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  #50  
Old 03-02-2012, 05:22 PM
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The ISDA wins the award for having the most condescending blog in the history of the internet.
http://isda.mediacomment.org/
I don't think that blog is owned by ISDA.

If it is, they need to get a bit more professional in their design/layout at the minimum.
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