Felix Salmon

Greece reaps the benefit of its CDS market

Great news from Greece: its brand-new €5 billion, 10-year bond issue was three times oversubscribed and is already rising in the secondary market, after pricing at a spread of 300bp over the mid-swap rate. Greece is paying a 6.4% yield on the issue, which is pretty affordable in the grand scheme of things, given how much trouble it’s in right now. And now that this bond has gone so well, there will surely be appetite in the market for more where that came from.

Why Greece shouldn’t worry about its CDS

This isn’t the first time that George Soros has wheeled out this particular argument against credit default swaps:

Those weak sovereign credits

Is there any sovereign credit which looks remotely attractive these days? I feel like a bit of a heel talking about fiscal distress even as the attention of the world is rightly concentrated on much more pressing real distress in Haiti. But the drumbeat is getting hard to ignore.

The Dubai mess

If you think that the Dubai situation has pretty much been resolved with that cash infusion from Abu Dhabi, think again. Paul Whitfield and Vipal Monga explain that nothing really has been cleared up at all, and that there are far more — and far bigger — uncertainties surrounding the emirate’s finances than most of us had suspected.

Sovereign default of the day: Foxwoods

Peter Applebome notes that dire financial situation at Foxwoods casino looks much more like a sovereign default than a run-of-the-mill commercial real-estate deal gone sour:

The morals of bailouts

Sudip Roy has gone me one further today. I pointed out the contrast between the expected actions of Sheikh Mohammed bin Rashid al-Maktoum in Dubai, on the one hand, with those of normal homeowners in the US, on the other: while American individuals are ceaselessly told that they have a moral obligation to pay their debts, the ruling family in Dubai is simply defaulting on its non-recourse underwater loans in accordance with the amoral principles of capitalism.

Dubai World: A great precedent

The Dubai World default is big news — big enough that it’s even made it into Gawker. Your one-stop shop for bloggy coverage this Thanksgiving is Alphaville, which features for instance this wonderful chart of the debt structure which is now being crawled over by lawyers around the world.