Prepare For A Trading Revolution: Here Come CDS For Retail Investors

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Wed, 02/23/2011 - 18:43 | 990646 Dr. Porkchop
Dr. Porkchop's picture

Can I take one out on America? Since it's already broke, it should be a sure winner.

Wed, 02/23/2011 - 18:44 | 990653 Racer
Racer's picture

You beat me to it.. that is exactly what I want

Wed, 02/23/2011 - 18:52 | 990690 Dr. Porkchop
Dr. Porkchop's picture

How about an Extinction Level Event Binary?

Wed, 02/23/2011 - 19:05 | 990739 johnQpublic
johnQpublic's picture

i'd take one side of that...doesnt matter which one i suppose

Wed, 02/23/2011 - 21:36 | 991125 Cpl Hicks
Cpl Hicks's picture

Funny+...and I'll take the other side.

Wed, 02/23/2011 - 19:19 | 990763 ZerOhead
ZerOhead's picture

Great... just great.

More financial 'hit contracts'... well at least they sound affordable... but I'm still worried about what a disgruntled employee at Smithfield Foods might do to Smithfield's food in order to cash in.

Am I missing something here? Or am I just a moron like all my ex-girlfriends have already told me?

Wed, 02/23/2011 - 19:37 | 990832 NotApplicable
NotApplicable's picture

Missing something? Naw, you just found the trip-wire and how it's connected to the bomb, that's all. 

So now when the SHTF, they will blame it all on those evil speculators that are constantly attacking the markets, and not the Benron cartel.


Thu, 02/24/2011 - 09:16 | 992367 Real Estate Geek
Real Estate Geek's picture

. . . well at least they sound affordable . . .

That's cause they're marginable!  I kinda like the sound of that--it means that we can win BIG!!!


Wed, 02/23/2011 - 19:01 | 990726 unwashedmass
unwashedmass's picture


what? no BAC? too close to the bone?

Thu, 02/24/2011 - 07:14 | 992207 fx
fx's picture

I wonder what you will be able to buy from the $$ that will be paid out to you...

Wed, 02/23/2011 - 18:43 | 990649 Jack
Jack's picture

The market only goes up.  What good are these?

Wed, 02/23/2011 - 19:11 | 990767 AUD
AUD's picture

Another scheme to keep the punters in paper rather than commodities of real utility?

Wed, 02/23/2011 - 19:15 | 990775 Jack
Jack's picture

Good point.

Wed, 02/23/2011 - 19:16 | 990777 Jean Valjean
Jean Valjean's picture

Sell them!  In fact, sell $1,000,000,000 of them!  You can be just like AIG.

Wed, 02/23/2011 - 19:23 | 990795 Devout Republican
Devout Republican's picture

Can one, in fact sell these short?  hmmmm

The company would actually have to go bankrupt?

Put me on the ask for a brazillion Intel CDS's.

Wed, 02/23/2011 - 19:51 | 990870 Zeilschip
Zeilschip's picture

You can sell Intel CEBO if you think they'll never go bankrupt. However the price of the CEBO will go up if Intel's perceived creditworthiness worsens (and vice versa), i.e. your mark-to-market on your Intel positions becomes negative (positive). I've been waiting for ages for retail CDS/CEBO!!!

Wed, 02/23/2011 - 20:03 | 990896 Devout Republican
Devout Republican's picture

Oh I thought it was more like a put. Thanks

Wed, 02/23/2011 - 18:44 | 990658 Michael
Michael's picture

Harvard whiz kids still at it. When will we rid ourselves of the parasites?

Wed, 02/23/2011 - 20:15 | 990917 lynnybee
lynnybee's picture

Michael, your coments are always spot on. you're the man (or woman?) . Harvard wil also turn to ruin, give it another 20 years....this paper - scheme life is going away. Like Jim Rogers says, the farmer in Iowa will be driving the expensive sportscar in the future, not the criminal skull&bones group.

Wed, 02/23/2011 - 20:54 | 991007 Michael
Michael's picture

Thanks LynnyB.

I like your Avatar.

Wed, 02/23/2011 - 20:41 | 990971 unununium
unununium's picture
  • AK Steel Holding Corporation
  • Advanced Micro Devices, Inc.


On the bright side, it's nice to have a list of the biggest CDS positions that the pig men need to offload.


Wed, 02/23/2011 - 18:47 | 990667 Seasmoke
Seasmoke's picture

inside info for all my cousins here at ZERO HEDGE , bet AGAINST ME !

Wed, 02/23/2011 - 20:28 | 990943 Ludwig Van
Ludwig Van's picture


Wonder what the insider-buying reporting requirements will be?


Wed, 02/23/2011 - 18:47 | 990669 Ragnarok
Ragnarok's picture

It's like they opened a new wing in the casino.

Wed, 02/23/2011 - 18:49 | 990680 Rogerwilco
Rogerwilco's picture

Yeah, a new room, and if you look at the back of your jacket in the mirror, there's an "x" in chalk.

Wed, 02/23/2011 - 19:35 | 990830 Sokhmate
Sokhmate's picture

if this new room doesn't offer free lap dances by voluminous Ukrainian nurses, I'm not participating.

Wed, 02/23/2011 - 20:21 | 990925 longjohnshorts
longjohnshorts's picture

"Voluptuous," not "voluminous."

But, hey, everyone to their taste.

Wed, 02/23/2011 - 20:34 | 990962 Sokhmate
Sokhmate's picture

I meant voluminous. I like volume.

Wed, 02/23/2011 - 21:06 | 991039 Seer
Seer's picture

Placed correctly, "voluminous" = "voluptuous" :-)

Wed, 02/23/2011 - 19:44 | 990855 A_MacLaren
A_MacLaren's picture

There can never be enough gaming tables, can there?

Wed, 02/23/2011 - 18:47 | 990671 Scottj88
Scottj88's picture

Holy crap, you have to be kidding me...

That and silver will be all the rage...


What kind of sick world do we live in with all of this nonsense derivative stuff...

Wed, 02/23/2011 - 18:48 | 990674 Gold 36000
Gold 36000's picture

a very poor hedging tool.  I've easily lost 50 percent on a stock and it stayed in business.

CEBOS for the masses!

Wed, 02/23/2011 - 18:49 | 990675 apberusdisvet
apberusdisvet's picture

Can I take one out on my neighbor who has 2 helocs, 2 kids in college and a wife who "saves" money by hitting the sales at Gucci and Tiffanys?

Wed, 02/23/2011 - 18:48 | 990676 Convolved Man
Convolved Man's picture

Off track betting where you win when your horse loses?

Wed, 02/23/2011 - 18:56 | 990703 Seasmoke
Seasmoke's picture

they already have that....its call a betting exchange !

Wed, 02/23/2011 - 18:48 | 990678 tmosley
tmosley's picture

How do I bet against the company issuing this crap?

Pretty sure bankrupted insurance agencies don't pay on their policies.

This development will revolutionize the market right into the garbage can (where it belongs), but I'm not sure that I would bet on getting paid in the long run.  Risk is all centralized, such that bankruptcy is all or nothing.  Either no companies fail, or the government AND ALL of the companies fail.

I just made myself sad :(

Wed, 02/23/2011 - 20:50 | 990998 Sheba Poe
Sheba Poe's picture

You may have asked a rhetorical question, but I'll answer nonetheless. Insurance "agencies" strictly speaking don't pay claims. They sell insurance on behalf of an insurance company, which bears the risk in exchange for premium. The agency is often the liaison between the insurance company and the policyholder. There are agencies called MGAs which may do some claims administration and in rare cases bear a portion of the insured risk, but this, I've surmised, is beyond the scope of your post. In order to bear risk, insurance companies must contribute to a state guaranty fund, which pays claims in the event of carrier insolvency. So, the answer you (don't?) want to the question you didn't ask is: "we do". Finally, the comparison between CDS and insurance is misguided and should be discontinued here at ZH.

Wed, 02/23/2011 - 18:49 | 990679 Cyan Lite
Cyan Lite's picture

I've been waiting years for these.  As a retail investor who invests directly into corporate bonds, this now provides me a way to hedge my bond portfolio.  I could also theoretically get long by selling CEBOs and collect premium upfront.  I would sell tons of CEBO contracts on any of the TBTF banks.

Wed, 02/23/2011 - 19:11 | 990764 AccreditedEYE
AccreditedEYE's picture

I've been waiting years for these.

+1M Me too. It's about damn time!

Wed, 02/23/2011 - 19:35 | 990828 Gold 36000
Gold 36000's picture

finally a voice of reason.


Gold 36000

Wed, 02/23/2011 - 18:49 | 990681 ReallySparky
ReallySparky's picture

What will they think of next? Unbelievable. Tyler do you ever bang your head on the desk?

Wed, 02/23/2011 - 20:36 | 990966 DosZap
DosZap's picture

If he does, he has company, this place is a friggin ZOO.

Their ALL on ACID I am telling ya!.

Thu, 02/24/2011 - 04:42 | 992128 StychoKiller
StychoKiller's picture

Things I experienced on Vitamin-A made some sort of sense in a holistic fashion, the market(s):  not so much lately!

Wed, 02/23/2011 - 18:49 | 990682 Financial_Guard...
Financial_Guardian_Angel's picture

Give me a thousand contracts on Illinois. Ok, I'll take an extra 1000 on the US Dollar. May I be allowed to purchase these using FRNs?

Perhaps a few extra on Gadhafi?

Wed, 02/23/2011 - 18:50 | 990683 ZeroPower
ZeroPower's picture

Bets on which CEBO will 'win' first?

MBIA anyone?

Wed, 02/23/2011 - 18:51 | 990685 Loco Vida
Loco Vida's picture

and what did Ted Kazinsky do wrong again????????

Wed, 02/23/2011 - 19:07 | 990748 johnQpublic
johnQpublic's picture

he got caught

Thu, 02/24/2011 - 04:43 | 992129 StychoKiller
StychoKiller's picture

He picked the wrong targets.

Wed, 02/23/2011 - 18:52 | 990686 Ragnarok
Ragnarok's picture

Wake me up when I get to create my own CDOs.....

Wed, 02/23/2011 - 18:52 | 990687 Gold 36000
Gold 36000's picture

YOu know what?  This is a scam!  The SEC invented this as  a way to smoke out small insider traders.  This is the SEC version of the bait car.

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