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Greece Issues Statement On PSI, Says €172 Billion Of Bonds Tendered In Swap, Will Enact CACs, ISDA To Meet At 1pm To Find If CDS Trigger
The biggest sovereign debt restructuring in history is now, well, history. The headlines are finally come in:
- GREECE ISSUES STATEMENT ON DEBT SWAP
- GREECE COMPLETES DEBT SWAP
- GREECE SAYS EU172 BLN OF BONDS TENDERED IN SWAP
- GREECE GETS TENDERS, CONSENTS FROM HOLDERS OF 85.8%
- GREECE SAYS 69% OF NON-GREEK LAW BONDHOLDERS PARTICIPATED
We learn that €152 of the €177 billion in Greek law bonds have tendered, which is 85.8%. This means that €25 billion in Greek law bonds have not - these are the hedge funds that could not be Steven Rattnered into participating, and will now sue Greece for par recoveries.This is also the number that ISDA will look at today to determine if, in conjunction with the CAC, means a credit event has occurred.
And yes, the CACs are coming, as is the Credit Event finding:
- GREECE SAYS WILL AMEND TERMS OF GREEK LAW BONDS FOR ALL HOLDERS
As a reminder from February 24:
Finally, as we have said all along, it is the UK-law bonds that are the fulcrum security here:
- GREECE TO EXTEND NON-GREEK LAW BOND OFFER PERIOD TO MARCH 23
And here is Veni:
«On behalf of the Republic, I wish to express my appreciation to all of our creditors who have supported our ambitious program of reform and adjustment and who have shared the sacrifices of the Greek people in this historic endeavour. With the support of our official sector and private creditors, Greece will continue implementing the measures needed to achieve the fiscal adjustments and structural reforms to which it has committed, and that will return Greece to a path of sustainable growth. Our invitations to offer to exchange, and submit consents with respect to, foreign law governed will remain open until 23 March 2012, after which there will be no further opportunity for creditors holding those instruments to benefit from the package of EFSF notes, co-financing and GDP linked securities which form an important and integral part of our invitations.»
Full release:
And ISDA is not wasting any time: it will meet at 1pm GMT to "discuss the question and to determine whether a credit event has occurred."
Finally, as a reminder, the ISDA vote today will be made by the following dealers and non-dealers. It will be up to them to decide if they wish to destroy the last trace of "integrity" of the CDS market and in effect commit institutional suicide. Because if they do in fact find that there has been no trigger event, then watch CDS bases go negative across the board, as any last pretense of CDS as a hedging instrument is thrown overboard, and the only "hedging" instrument left is to sell.
Voting Dealers
Bank of America / Merrill Lynch
Barclays
BNP Paribas
Credit Suisse
Deutsche Bank
Goldman Sachs
JPMorgan Chase Bank, N.A.
Morgan Stanley
Societe Generale
UBS
Consultative Dealers
Citibank
The Royal Bank of Scotland
Voting Non-dealers
BlueMountain Capital (Second Term Non-dealer)
Citadel LLC(First Term Non-dealer)
D.E. Shaw Group (First Term Non-dealer)
Elliott Management Corporation (Third Term Non-dealer)
Pacific Investment Management Co., LLC (Second Term Non-dealer)
...And finally, congratulations to all Greek pensioners. You have now all been Corzined. Further instructions will be mailed in your next monthly pension statement.
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My gold's just gone down by...nothing...
run for he Hills - http://hedge.ly/gFWVSm
Nope... Still desperately trying to give a shit and... er... no.
OKAYYY
how about we JSUT SAY FUCKALL CREDIT DEFAULT SWAPS ....just for fun and lkess see whahpenzz...... i mean at this point ugootta thorw sum fiking darts
If this ain't default I'm Tarzan once again
OOOAoaoaoaoaohhhahahh
In plain english please, what is likely to happen to stocks if ... and why:
1)if cds are triggered
2)if cds aren't triggered
Thanks in advance for any input
Dammit Jim......I'm a doctor, not a financial psychiatrist.
I'd rather bet on a one legged marathon runner than bet the isda will rule this a credit event. All cds are going to become worthless, and bonds rates are about to skyrocket
There is zero hedge now
This event will destroy any cheap money the US government gets. The US government will default. This is why ZH is looking at the CDS so closely. This is the "Black Swan" event.
so basically they have emptied out most their bucket so they can start filling it again...
debt is cut so they can borrow more....
Rinse and repeat.....wow......that came out of left field.
Who wudda thunk it?
Tyler, did any of the English law bonds lived to tell? It would be nice to get paid in full while everybody else volutarily got screwed just to prove how rotten the system has become!
Why doesn'y everybody just say' To hell with these pension funds, I'm not putting any more in?" Oh they can't, can they, 'cos it's tha law isn't it...
Everybody needs a 'Stakeholder' pension I say, 'cos that way everybody has a 'stake' in the future of the country, no matter how deep in shit it is, or how short lived it might be...
ding ding ding
US govt default is the gigantic, ugly, smelly, elephant in the room that is eating its own shit, and NO ONE in the press is acknowledging it.
ding ding ding
US govt default is the gigantic, ugly, smelly, elephant in the room that is eating its own shit, and NO ONE in the press is acknowledging it.
They can print it for the cost of ink and paper, or go the economical route of hitting a few keystrokes.
True, they can do that - once. And it will work - for a little while. And then the whole system collapses. Our whole debt-based system is dependent not only on issuing new debt but on rolling over existing debt. If the Fed/Govt really starts to go down the road of printing unsterilized currency they will almost immediately have to roll over the entire debt because there won't be any more private or foreign buyers.
"It will be up to them to decide if they wish to destroy the last trace of "integrity" of the CDS market and in effect commit institutional suicide. Because if they do in fact find that there has been no trigger event, then watch CDS bases go negative across the board, as any last pretense of CDS as a hedging instrument is thrown overboard, and the only "hedging" instrument left is to sell."
The key word "sell" meaning the big boys will be making a run for the exits in any paper. This is sometimes referred to as a bond market crash.
But is only 15% that are holding out, lets make a law that says "there will be no hold outs, hold outs will not be tolerated,
After all you gave us one Euro and your getting 30% back and if you wait 30years we will give it to you, the whole 30%- promise. And for the steak knives we offer you a special dividend in any year Greece has a euro to spare.
Whats not to like- lower interest (which we will borrow) longer terms and special dividends when we are an economic power house and earn a surplus in goat meat and olive oil trades.
Banks - can't live with them and can't live without them - but they just got bailed out again
Reminds me of my EX wife. Loved me when I had it left me when I didn't and sued me for what didn't exist .............
And WON
It will be up to them to decide if they wish to destroy the last trace of "integrity" of the CDS market and in effect commit institutional suicide. Because if they do in fact find that there has been no trigger event, then watch CDS bases go negative across the board, as any last pretense of CDS as a hedging instrument is thrown overboard, and the only "hedging" instrument left is to sell."
The key word "sell" meaning the big boys will be making a run for the exits in any paper. This is sometimes referred to as a bond market crash.
This is correct. The question is always of timing - when. The CDS market is destroying itself. If ISDA does not say an event is triggered, eventually, participants will abandon this market because it is worthless and corrupt - but the question is when. If an event is triggered, then the CDS will collapse the banking system.
This is the same way debt is structured. CDS is simply a derivative of debt.
French Frogs: "... what is likely to happen to stocks if cds's are triggered"
Bank stocks would fall as investors tried to figure out who is most exposed and where the contagion might be. Everyone will be trying to figure out who the weak link banks are, and the vultures will come flying in to tear them apart -- leading likely to more QE. I would also expect a general "risk off" trade until investors see where the chips fall.
But you know all that LTRO2 money that the banks took and then immediately turned around and redeposited it with the ECB ... well, that's likely to go to zero in short order.
No, only 172 Billion or so...
The rest will balloon to trillions very soon...
ISDA will not find an event of default (CDS issuers cannot afford to pay out) but this will have no impact on CDS markets because institutional investors will buy CDS as a hedge just as they always did, and for the very same reason -- because it is the right thing to do to protect investors.
You think there is a disconnect? There is no disconnect. This is a Ponzi operation, top to bottom, everyone has to play along in order to be paid. They are getting rich, they don't give two shits if their logic seems insane to anyone else.
Thanks to all for the various and varied points of view
Greece will default in the end. There is no other end result.
http://silverliberationarmy.blogspot.com/
"If the consents to theproposed amendments to the Republic’s Greek law bonds are accepted, the sum of the faceamount of those bonds that will be exchanged and of the other bonds subject to theinvitations for which the Republic has received tenders for exchange and consents to theproposed amendments will total approximately €197 billion, or 95.7% of the total face amountof the bonds subject to the invitations"
This is the biggest horseshitsquared statement made by the Greek government yet. It assumes the hold outs on the non greek legislated bonds willl agree to the terms of the CaC (which can't be applied to the to the non greek legislated bonds anyway so why the feck would they agree) and they have until March 23 to think about it. FFS.. They then include the 95% figure so the 5% hold outs on the greek legislated bonds can't collect on their CDS as no Cacs will be implemented IF all the non greek legislated bonds agree to the terms of the CaC... are they for fucking real?
+10^2 LOL
The ISDA willno doubt say they are waiting until March 23 to see if the extra 5% of the non greek legislated boindholders can push the active participation of the PSI over 90% which does not define a credit event.
I hope the CDS and bond markets goes apeshit in the meantime to send a clear message DON'T FUCK WITH THE RULES
Markit Group and Creditex Group said credit default swaps traders established initial recovery values of Northern Rock Asset Management bonds at 99.25% and 98.5%, depending on the maturity. Northern Rock triggered a restructuring credit event last year when it repurchased subordinated debt.
http://www.smartbrief.com/news/isda/storyDetails.jsp?issueid=D831DEF0-9D...©id=CB109B63-C24A-4F07-A4CB-359D611F87E5
its already at 95%
Using the CAC is a credit Event
lol
Knowing that the bankers, MSM, and the Greek government are all involved spinning the info in the best possible light, I expect more than 100% participation. And those airheads on CNBS will be totally serious when they break the "good news"!!!
How much Greek debt is being discharged in this deal? In billions please.
greece defaulted a long time ago -- they are just postponing that reality in banking delusions and profit-taking vampirism.
Same as the US. We are among the living only due to our reserve currency status, otherwise we'd have gone Weimar long ago.
Yea no kidding, wait until the pensioners see that their pension payment for next month is cut in half. If they don't call this a credit event, then everything is a joke.
fuck
Not just yet thanks but maybe some other time...
Bullish right?
I stayed up for this like waiting for Santa Claus....
Wow... So... what now?
What now? Just about every last subordinated bond holder in Europe is looking to get CAC proof right quick.
Pay back Time!
No, I don't think they're going to get paid back...
"I stayed up for this like waiting for Santa Claus...."
Did you leave out cookies and milk? What did your letter say?
He left me coal (sigh).
At least I'll have something to burn in the fireplace at the end of March.
already swapped your FRN's for gold eh?
No, silver...gold's too pricey for me.
Interesting...so they and who they are I have no idea...but they got it done.....why I do not know...boy the bankers have unlimited powers it seems...
Twas nothing that certain items changing hands under tables couldn't overcome.
more like "government excluding Greece." talk about a "cramdown provision"!
http://www.youtube.com/watch?v=MVX2NgoJwTY&feature=player_detailpage
To CDS or not....I think it will be called a non CDS event...
Oh absolutely. And trumpets will sound declaring the crisis has passed. Again.
But then what happens to all the other CDS's in the world? Wouldn't they instantly become (even more) worthless?
ass trumpets
I think it will be called a credit event horizon
100% PSI soon!
this ponzi will not end well.
I have read every " dog gone" Tyler post on this topic! One conclusion comes to mind! Tyler was right from week 1, and the Credit default Swaps are going to be Triggered.
More Importantly, this is a wake -up notice. Welcome to European Politics. Better yet, welcome to a more socialist France. That scenario is UGLY!
I seem to recal Tyler said the CDS would not be triggered as the ISDA is made up of the same banksters that sold the CDS.
"Keep in mind, as criminal as this appears, and as damaging to the CDS market, the real trigger will be what ISDA does determines following the end of the PSI process[ i.e. now]. If there is no credit event then either, especially when the CACs are triggered as expected - an event which will certifiably be a trigger event under Section 4.7, then ISDA is truly hell bent on blowing up the CDS market as a hedging vehicle in its entirety."
Source "ISDA Unanimous - No Payout On Greek CDS", March 1
i'm wondering how (in the event of an ISDA non-event ruling) this affects claims of net notional CDS positions then. everyone knows that gross is ballpark $700T, an unfathomable sum, but the shock of that number is mollified by assertions that the exposure is almost prefectly hedged. as ZH has mentioned repeatedly, that claim is already absurd because of counterparty risk. but what happens when >50% haircuts can be deemed "voluntary"? $700T is only hedged but for the grace of ISDA?
No, the notional of CDS is NOT $700 trillion. The vast majority of swaps are plain vanilla interest rate and other similar type swaps, not CDS. The notional of all CDS is still very large but nowhere near $700 trillion.
CACs voted in
Intention to trigger CACs announced
...but CACs haven't actually been triggered yet
Quit jumping the gun. It ain't over until the fat V lady sings "Endless Foreplay"
["Careless Whispers"]
This looks to be a black swan because it is a dambed if you and don't scenario. Damned if it is a credit event because it triggers CDS. Damned if you don't because it blows up the CDS market.
Beautiful.
So how will they change the rules to get out of this?
Hear me out. Suppose I am a CDS issuer and a voting member of the ISDA, in the end it is all about money, not reputation, not what is right, just numbers. If I declare no credit event what is the worse that can happen? The CDS market blows up, I will concede that. However if I already collected the proceeds at issuance the only thing I am losing is the future proceeds of new CDS issuance. Since I don't have reserves set aside to cover the CDS anyway that may be the most pallatable decision, give up the CDS market. The secondary market takes the hit.
However, if the CDS issuer is also holding counterparty CDS as an accounting gimmick to offset enourmous risky portfolio exposure, what happens to their balance sheet when they need to re-value those CDS hedges? Oh I forgot, 'assets' are no longer required to be marked to current value, they still win.
Time to see if CNBS was right about CDS being irrelevant and how good that firewall truly is.
Lehman 2.0 mother fuckers.
I agree...I bet there are many under the table deals.....guarantees for the pensions that when that bailout money comes...they get it back...amongst others....
WTF does all this mean?
It means that we have to wait AGAIN for the ISDA to tell us it's not a credit event AGAIN...
otherwise they lose their jobs...
thanks, time for blues clues
.
But as Tyler pointed out, "If there is no credit event then either, especially when the CACs are triggered as expected - an event which will certifiably be a trigger event under Section 4.7, then ISDA is truly hell bent on blowing up the CDS market as a hedging vehicle in its entirety."
...So what happens if the CDS market is destroyed as a hedging vehicle? Someone else pointed out there's 700T of gross CDS out there... what would it mean if it's impossible for a CDS to ever be triggered?
It means a primary driver of the TBTF business model would be shot to hell.
if not a credit event does isda get sued? with trillions in value one assumes somebody paid something and thought they were getting more than life insurance which said oh but you're not dead nor will you ever be dead.
Someone else was also corrected, in that the majority of the notional derivative total is from Interest Rate Swaps (JP Morgan heavy), not CDS.
So, does this mean I'm supposed to buy AAPL or IBM or what?
There's never a RoboTarder around when you need one.
RoboTarder
LOL.
good for crude oil I guess ?
CNN still has this article "nearly 95% of bond holders accepted the swap" ...
Well, I believe there may be egg in my eye in a financial sense here...
Oh well, if I bought the line I can do the time.
It's like that double rainbow video:
WHAT DOES IT MEAN??
CNBC has been running a story all day about the 95% private creditor participation rate, no CACs no CDS. What's up with that? Futures dont seem to mind any of it at the moment.
"The Republic has decided to extend the invitation period in respect of each series of itsbonds issued under laws other than Greek law until 9:00 p.m. (C.E.T.) on 23 March 2012, toallow holders of those bonds who have not yet tendered them for exchange or submittedconsents to do so."
They are extending it.....hmmmmmm...wierd
surprised to see that bonds under foreign-law jurisdictions got invitation extensions until march 23, 2012. most CDS holders were probably in this camp, so the CDS might not trigger until then. am i missing something?
I think you are right...but we all are MISSING a lot.....
Maybe that's what ISDA will argue tomorrow.
You expected Teotwawki again for the umpteenth time?
One time you might be right and thankfully
face Judgement immaculately unencumbered
by worldly possessions.
Doesnt look like CDS will trigger. Guess that means i have to go to work tomorrow
DEFAULT BITCHEZ
Waga Waga
Sell the news?
cds will be triggered, what now?
http://www.jinrongbaike.com/
http://www.cnhedge.com/
It's net nothing, honest, FT said so.
Can someone fill me in on the mindset of an investor in Greek sovereign debt? It occurs to me that you have two flavors of sovereign bond buyers: those with aversion to risk (e.g. buyers of short-term US) and those who expect default (e.g. buyers of Greece). With the yield where it is, why is it necessary (or suprising) that this circus act starts up when such news comes out? Seriously, I'd be interested in constructive insight.
Constructive insight inbound mate. Take cover.
http://www.bloomberg.com/news/2012-03-06/goldman-secret-greece-loan-show...
Thanks for the link HD. While reading it occurred to me that while GS can totally screw an unknowing novice like Greece, it takes a much bigger smokescreen to screw "more sophisticated" govts like UK and US. Either that or the leaders of those govts need to be totally in bed with the banks themselves. That couldn't be the case... could it??? [sarc]
Thanks for the link HD. While reading it occurred to me that while GS can totally screw an unknowing novice like Greece, it takes a much bigger smokescreen to screw "more sophisticated" govts like UK and US. Either that or the leaders of those govts need to be totally in bed with the banks themselves. That couldn't be the case... could it??? [sarc]
ISDA - Safe and Efficient market ... BITCHEZ!
So much for trailing stops?/sarc
They will never under any circumstances call it a credit event - they can't. The only thing worth less than endless fiat are CDS contracts.
But wouldn't not calling it a credit event result in an implosion in all other CDS contracts? Who would buy a CDS if a clear default isn't called a credit event? (Then again, who would buy one now?)
CDS is a cancer plain and simple. This entire crisis was centered around the now worthless CDS. When you deregulate bankers this is what you get - an orgy of greed that brings the world the brink.
CDS will be unwound on an ocean of fiat and inflation. They have to destroy the CDS market.
Deregulation isn't a problem if you let failures fail, or let people voluntarily choose their medium of exchange.
I agree. What we have now is effectively the power given to the bankers to fuck with the currency(s) pretty much any way with they like, in order to extract the wealth of us peasants, without possibility of taking a real loss if they get it wrong... and we are forced to use that currency to the exclusion of all others.
Serfdom
Yep, that's why I love this situation. This can only result in a financial implosion no matter what happens. It's almost game over for Ponzi.
It is. But, after the dust settles, they'll only replace it with a new one. Sure, we might get a sorta-kinda-gold standard type arrangement, backed by real commodities, for a few years first. But in the end, they'll restart the Ponzi. They have to; it's the only way they can compete with the rest of us. On a level playing field, the super rich's wealth would erode over a few generations as smarter people soak up the money, since intelligence and talent will always rise to the top of any profession if the game is played honestly (which naturally can never be allowed to happen in the real world; not in finance, business, education... nowhere!) - they aren't the best and brightest mankind has to offer.. and they know it perfectly well!
Anytime I hear about Credit Default Swaps being activated; I get nervous..
I just count my stack again. It helps me calm down.
?
CNBC Europe talking heads are looking for a reason the FX markets (dollar suddenly stronger) and U.S. futures turned negative on news.
Hmmmmm.....
You don't suppose somebody inside knows something ????
barliman
Desperation sweat time in Europe
CNBC Europe talking heads entertaining idea this headline is meaningless ...
(Our producers are screaming in our ears because the talking putz just asked a guest why her firm declined to participate.)
Very quick cut to commercial - second commercial break in five minutes.
barliman
Know something? You mean like the fact that Greece is going to nix 25 billion in bonds with a few line outs on contracts? And furthermore, do you suppose people know that this will have an effect on other PIIGS debt markets...as folk try to get as CAC proof as possible? You mean know stuff like that?
No offense ... but no
More like "the Greek bastards are lying about the numbers and somebody in Germany just let the word out on the back channel"
barliman
Ah...I see...like a second derivative conspiracy theory. Got it.
I'm going to stick with my angle...that of other European yields rising.
I am with you on that - up go the yields.
And frankly I hope the CDS market is dead and burried.
For simpletons like me they have made the bond markets untradeable. Any market where the price of a derivative (with a comitee determining its legitamacy) has become more important than the price of the underlying is bad news. Bring back markets where `discount to yield` & `cheapest to deliver` calculations are sufficient to determine price and then we will see in plain daylight where the underlying does trade.
Except Ben and Mario will just buy everything anyway. R.I.P price discovery & efficient allocation of capital, we miss you.
FYI
The blonde and the albino just pointed out those items
Other chap just pointed out that there are huge bets being made that Spain, Ireland, Portugal, Greece etc etc can be turned around in 18 months and that is NOT going to happen.
European cynicism breaking through
barliman
The blonde and the Albino?
uhmmmmm
Chunky blonde with stringy looking hair and Italian accent (Anna Armstrong) and OK, the "albino" doesn't have pink eyes but he couldn't be ANY whiter, I missed his name and he's from some German bank, I think ... They have now been excused.
barliman
Jeesus? String-ey Hair? I'm not taking sides. Southern BUSH PIG?
Leave your short trades open. Don't T/P. This is going to be a slow melt down.
From your mouth to the markets ears...
HD you are Obviously well versed. Why waste your time with my posts?
I agree with the idea of a slow melt down. I think the market is less likely to suddenly implode as it is to slowly bleed to death...
Thank You. Have a Great Week End.
ISDA, just a big circle jerk.
The meanings of this are several.
One is that a sovereign government can default, offer you some return greater than zero (which is what you get in default), and if you take that non zero return (which is much lower than what you were owed in your holdings), this constitutes "agreement" and "consensual refinancing" and doesn't trigger swaps.
This means sovereign swaps really have no value at all. Countries will ALWAYS do this. They will always offer something less than you are owed, but something more than zero, and the holder facing a zero return will always take the offer -- which looks consensual and thus not a swap trigger.
This HAS to remove swaps as a viable sovereign hedge tool. Unhedged, no one will want to own these bonds.
Rates are going to go up.
Thank you, that was the clearest explanation I've read so far.
Good points, but the banks will continue to buy the bonds because they must to keep the game going.
Its like writing a software program for a virtual reality matrix world. There are no real rules that can't be broken by writing another program to temporarily fix the glitch. The hard drive eventually failing from lack of capacity is another issue is another issue. As long as the real world can be locked into the fantasy program long enough for them to be looted, the banker programmers will rule the machine.
Very soon !
They will claim that 85 percent is not a reason to trigger CDS
The world is full of BS and this situation is at the top of a very smelly pile of it
I would bet that they already have ISDA buy-in and promise that no CDS will be triggered even before they got the deal done.
what will the call it? A credit event? or A fish fry? Do you want tarter sauce on your irradited Fukashima fish?
Gap down Friday?
We're overdue.
the real question is can the Greek protestors ignite the Parliment building? And hopefully if they can the building will be full.
WOW!
Back from commercial ... focus on drop in China CPI
("Anything but Greece, FX & Futures you fecking idiots!!!")
barliman
It doesn't matter. The English bonds are going to be the trigger! Relax and enjoy the call spreads! You people are commanding the "U' Boat!
How many Greeks does it take to screw in a lightbulb? None, there's no electricity anymore.
swap this, swap that... man its all meaningless for the stock market... http://tinyurl.com/6pdb52k
greece now, portugal, ireland, the cards have been shown. They are next but the central banks will print as much as necessary to back stop the system. Stocks the place to be, CDS event... who cares. Debt swap... who cares. Central banks across the globe furiously printing money??? Buy stocks..
+1 for the Vicky Vette av
What started this other than fiscal mismangement was the God Worker Bank helping Greece hide its true liabilities in order to gain acceptance into the Euro.
When people cover up the true facts in a contract that is usually a deception called fraud in a criminal court.
Why Goldman Sachs isn't being pursued by the criminal courts is beyond me. After all the counterparty Greeks probably had no clue what they were signing, they were just told it was legitimat and would fix their balance sheet for a little while.
GS OWNS the courts. Hell, they got rid of two elected clowns, even though they were clowns, and put in two bankster pencil neck thugs liyerally taking over countries in a coup de ta and no one said a word. And you think they are going to be prosecuted? By who?
GS owns nothing! I have dealt with their Minions. Relax, and hold your position.
Correction: The courts are owned by the same people that own Goldman.
Omnes viae Romam ducunt.
...I do not see ''independence'', I see Wardens and punk'd out pathetic pushovers. Come on Greeks!!! Who are you? Really! Are you Greek? ...or are you something ''other''? http://www.youtube.com/watch?v=q7iXcKKpdx0
Now that it is official that sovereign bondholders have no rights and that contracts can be unilaterally abrogated, only hedge funds (whose 2 and 20 don't care if haircuts were voluntary or not) will avoid sovereign paper. Banks, whose bond desks are playing with OPM and who get bonused for accounting gains but suffer nothing for real losses, will continue to buy as if nothing happened.
And whither Greek pensions, who just accepted an effective wipeout? Might as well liquidate the fund, which means cash out and buy Ouzo for those who no longer have a retirement.
Finally, extend and pretend has now gone to 23 March, which allows time for at least half a dozen new "Greek progress" rumor rallies in UK Law-issued bonds. Will UK Law follow the Greek road and alter CAC terms to a pre-2004 and pre-2003 69%?
If CDS aren't triggered, I'd like to know which stupid muth fuggas are still buying CDS...what's the point? They don't pay on a default, maybe they pay on a super duper collapse of the global financial system type default...wait, well, maybe they pay in beans or something.
MAGIC beans at that.
Vanishing beans *POOF*...but Mr. Corzine's on the case.
I'll tell you EXACTLY which stupid mother fuggas are still buying CDS...
Pension funds, Superannuation Funds and Insurance Companies with peripheral eurozone sovereign debt who continue to value the worthless paper at historical cost.
Their balance sheets have giant black holes in them, covered up with the accounting alchemy of bond insurance.
These sovereign CDS are not even brought to be triggered... just to perpetuate the accounting fraud on their own customers/policyholders.
Disgusting.
lack of an alternative.