Comments on: Worrying about Greece’s CDS for the wrong reasons http://blogs.reuters.com/felix-salmon/2012/03/02/worrying-about-greeces-cds-for-the-wrong-reasons/ 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: scythe http://blogs.reuters.com/felix-salmon/2012/03/02/worrying-about-greeces-cds-for-the-wrong-reasons/comment-page-1/#comment-36656 Thu, 08 Mar 2012 06:51:50 +0000 http://blogs.reuters.com/felix-salmon/?p=12312#comment-36656 good explanation of the contractual realities and subsequent negotiations

and the key message needs to be repeated:

(quote, felix) “Greece hasn’t actually defaulted yet: every payment it has promised to make has, to date, been made in full and on time… If a government explicitly repudiates its outstanding debt, then that can count as an event of default even before a payment is missed. But Greece hasn’t actually done that. And most of the time, default swaps only pay out when there’s a default. Which is as it should be.”

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By: Junkbond1 http://blogs.reuters.com/felix-salmon/2012/03/02/worrying-about-greeces-cds-for-the-wrong-reasons/comment-page-1/#comment-36634 Wed, 07 Mar 2012 22:08:06 +0000 http://blogs.reuters.com/felix-salmon/?p=12312#comment-36634 This guyz a retard

Here’s some eloquently written claptrap about Bear Streans in 2007.

http://www.portfolio.com/views/blogs/mar ket-movers/2007/06/29/why-margin-calls-n eed-not-destroy-the-cdo-market/

How can people still read this dumbnumb’s article.

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By: CNDMX http://blogs.reuters.com/felix-salmon/2012/03/02/worrying-about-greeces-cds-for-the-wrong-reasons/comment-page-1/#comment-36588 Tue, 06 Mar 2012 19:49:21 +0000 http://blogs.reuters.com/felix-salmon/?p=12312#comment-36588 Excellent article is financial mechanics have to be explained so people take smart decisions and evaluations about the risks they are facing

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By: TrapperPettit http://blogs.reuters.com/felix-salmon/2012/03/02/worrying-about-greeces-cds-for-the-wrong-reasons/comment-page-1/#comment-36473 Sat, 03 Mar 2012 00:37:03 +0000 http://blogs.reuters.com/felix-salmon/?p=12312#comment-36473 http://noisyroom.net/blog/2012/01/31/bre aking-news-ellis-martin-report-with-jim- sinclair/

Jim Sinclair called it. Worth a listen my friends. Tick Tock, Ti—?

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By: anonhfm http://blogs.reuters.com/felix-salmon/2012/03/02/worrying-about-greeces-cds-for-the-wrong-reasons/comment-page-1/#comment-36466 Fri, 02 Mar 2012 18:59:37 +0000 http://blogs.reuters.com/felix-salmon/?p=12312#comment-36466 @spectre855

He’s consistent, and i think it works this way. If the auction were to happen before old GGBs disappear, then someone who holds CDS can simply deliver old GGBs. That way CDS is worth precisely 100 minus recovery on old GGBs. There is no uncertainty. Right now, recovery on old GGB looks like 24ish.

If the auction happens AFTER old GGBs disappear, then CDS will settle based on the cheapest-to-deliver still outstanding. By PURE HAPPENSTANCE, the longest new GGB (2042 maturity) is indicated at 23 bid and 25 offer. So CDS will be worth about the same as in the “quick auction” scenario. But that is just dumb luck! The product is still broken.

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By: spectre855 http://blogs.reuters.com/felix-salmon/2012/03/02/worrying-about-greeces-cds-for-the-wrong-reasons/comment-page-1/#comment-36460 Fri, 02 Mar 2012 17:47:04 +0000 http://blogs.reuters.com/felix-salmon/?p=12312#comment-36460 I wish I understood this stuff better. I thought the big issue now was the timing of the auction?

Here you say, “If and when the CDS is officially triggered, there will be an auction, and the CDS will be found to be worth roughly 75 cents on the dollar.” but doesn’t that contradict your previous point or am I missing something?

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By: FinanceChicken http://blogs.reuters.com/felix-salmon/2012/03/02/worrying-about-greeces-cds-for-the-wrong-reasons/comment-page-1/#comment-36457 Fri, 02 Mar 2012 17:04:46 +0000 http://blogs.reuters.com/felix-salmon/?p=12312#comment-36457 Marking the ECB’s bonds as separate securities IS subordination NOW.

If the ECB want’s to prove that statement wrong, then they only need to offer to sell some of the new bonds and show that they would generate the same price in the market… Safe to say that the new bonds will NOT trade at the old bonds price… VERDICT: pari passu? not so much.

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By: streeteye http://blogs.reuters.com/felix-salmon/2012/03/02/worrying-about-greeces-cds-for-the-wrong-reasons/comment-page-1/#comment-36456 Fri, 02 Mar 2012 16:23:29 +0000 http://blogs.reuters.com/felix-salmon/?p=12312#comment-36456 you’re right, but given they way they’re communicating and the way they operate, would you trust ISDA? Seems like insiders making up the rules as they go along. I think Barry and others have a point when that there shouldn’t be this kind of vague clique-y shenanigans going on and they bring disrepute and systemic risk to the markets. Sure, they’re all big boys, up until the point when everything blows up and then it’s all the government’s fault and they need to step up with a rescue.

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