Comments on: Friday links mess things up again http://blogs.reuters.com/felix-salmon/2009/04/17/friday-links-mess-things-up-again/ A slice of lime in the soda Sun, 26 Oct 2014 19:05:02 +0000 hourly 1 http://wordpress.org/?v=4.2.5 By: Matthew http://blogs.reuters.com/felix-salmon/2009/04/17/friday-links-mess-things-up-again/comment-page-1/#comment-561 Sat, 18 Apr 2009 07:12:03 +0000 http://blogs.reuters.com/felix-salmon/2009/04/17/friday-links-mess-things-up-again/#comment-561 For some time there have been worriers about this issue (CDS/Bankruptcy) with regards to EM Sovereign CDS.

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By: KenG http://blogs.reuters.com/felix-salmon/2009/04/17/friday-links-mess-things-up-again/comment-page-1/#comment-560 Sat, 18 Apr 2009 06:55:28 +0000 http://blogs.reuters.com/felix-salmon/2009/04/17/friday-links-mess-things-up-again/#comment-560 on credit swaps and bankruptcy:

Imagine you sell fire insurance to homeowners. one day, a customer has a small fire in their kitchen. they can put it out with some damage, but instead they decide to let the whole house burn down, so they can collect insurance. Who is going to want to sell insurance to people like that?

My guess is the same people who sold CDSs. The geniuses who know how to assess risk.

So maybe one of the defenders of the swap out there can provide the names of some CDS sellers who can actually price risk somewhere in the ballpark of reality. I’m guessing not.

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By: vm http://blogs.reuters.com/felix-salmon/2009/04/17/friday-links-mess-things-up-again/comment-page-1/#comment-558 Sat, 18 Apr 2009 06:06:40 +0000 http://blogs.reuters.com/felix-salmon/2009/04/17/friday-links-mess-things-up-again/#comment-558 Felix–

Mostly I have been in agreement that CDS are generally a good thing, but I had never considered the BK angle before. Reducing incentives to negotiate an outcome other the BK seem to be a fairly horrible side effect, maybe one worse than CDS benefits. thoughts?

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By: The Epicurean Dealmaker http://blogs.reuters.com/felix-salmon/2009/04/17/friday-links-mess-things-up-again/comment-page-1/#comment-553 Fri, 17 Apr 2009 23:39:17 +0000 http://blogs.reuters.com/felix-salmon/2009/04/17/friday-links-mess-things-up-again/#comment-553 Thanks, Felix. I’ll be sure to send you a review copy once I get John Grisham to ghost write it for me. By the way, I think I may owe you royalties.

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