Here Come The CACs: CDS Trigger Is Next

Tyler Durden's picture

First comes the CACs. Then the forced debt exchange offer. Finally - default: as defined by both the rating agencies and ISDA, together with triggered CDS.

From Bloomberg:

The Greek government is drawing up legislation that could be used to impose loses on investors who don’t support the debt swap that’s part of the country’s new bailout package, said two euro-region officials familiar with the situation.


The law may be introduced to parliament in Athens in the coming days, said one of the officials, who spoke on condition of anonymity because the deliberations are confidential


Euro region finance ministers are prepared to back the use of so-called collective action clauses if a voluntary debt swap doesn’t draw enough participation, the other person said

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Temporalist's picture

Everyone's swapping spit but nobody wants the mono.

nope-1004's picture

Tyler, aren't the CAC's invoked to stop a CDS trigger?


trebuchet's picture

my understanding is it wont stop holdouts and brings that subordination thingy into peoples nightmares....

.. which will take some time for people to translate credit risk change ACROSS EUROPE (Ouch!!! ) to wider EUR weakness

There is No Spoon's picture

not in this case because this cac would be retroactive.

GOSPLAN HERO's picture

It's time for Greece to flat line.

Chief KnocAHoma's picture

Does this mean American Idol will be canceled?

WALLST8MY8BALL's picture

CDS with CAC's - Kind of funny!

masterinchancery's picture

Sounds like a couple of venereal diseases--very appropriate.

Harlequin001's picture

and all those people who thought they'd got away with it are going to have to pay...

falak pema's picture

anti banksta fire wall of Troy!

PicassoInActions's picture

if such law will exists, why not to use for 100% haircut?

WestVillageIdiot's picture

Not for the politicially connected. 

sankol's picture

So it begins!


Chief KnocAHoma's picture

I have been hearing this for five years now. The sky is falling... a wolf is coming... no really honey I won't blow in your mouth...

Calm down... the World ain't gonna end... but buy some ammo just in case.

Swear to God that was the advice from one of my brokers at a party last night. The question was what should I be accumulating?

His answer - ammo



Martial's picture

haha...crazy thing is I've been given similar advice from people you wouldn't expect to say such things.

Temporalist's picture

If either of you are like the majority of the American Idiots you aren't heeding the advice.

IrritableBowels's picture

Tested both.  FAST shipping @ cheaperthandirt.


Federal 180 gr. .40 cal HST JHP-50 rds. for 19.89. - - - As cheap as plinking FMJ's.


Edit:  Thought the following description would be appropriate:

"A specially designed hollow-point tip won't plug while passing through a variety of barriers and this bullet holds its jacket in the toughest conditions"

Chief KnocAHoma's picture

Hey dude... you would have to know me for more than one minute to determine I am an American Idiot... I went to college and have a job and pay taxes...

What was I saying I lost track. Any way it ussually takes people several days to determine I am an idiot.

JPM Hater001's picture

Somebody please... "CACs"

Conrad Murray's picture

Picture a bunch of technocrats running around desperately trying to find the can they're supposed to kick before it disappears. A rumble comes from the sky. It's a squadron of bondholder bombers. They set their sights on the can, maybe even coyly hoping to level a few technocrats in the process, and let the CDS munitions loose...CAC CAC CAC CAC CAC

Chief KnocAHoma's picture

Too freaking many cans and not enough feet!

resurger's picture

32,000,000,000,000 worth of Pyro ....

EuroBear's picture

Time to load up EUR shorts.

asteroids's picture

Does anyone have an example of a CDS every paying off???

trebuchet's picture

Ouch, keep the REAL newsflow that MATTERS coming Tyler!  

It is much appreciated.


Ive closed out my longs today was a good ride up on the Rumour/Momo machine, looks like one hell of a ride for the weekend ahead

rubearish10's picture

Slow day. Add this to the weekend "drama" list. 

Cognitive Dissonance's picture

"The Greek government is drawing up legislation that could be used to impose loses on investors who don’t support the debt swap that’s part of the country’s new bailout package, said two euro-region officials familiar with the situation."

So......would someone please explain to me the difference between this and good old fashioned highway robbery?

Highway Robbery


BlackSea's picture

The inconvenience of being stopped in order to be robbed has been eliminated.

WestVillageIdiot's picture

"As through this world I've wandered
I've seen lots of funny men
Some will rob you with a 6 gun
And some with a fountain pen"
-  Woody Guthrie

It kind of says it all. 

gmrpeabody's picture

On a scale of 1 to 10 in honesty..., the man with a gun will usually score several points higher than the man with the pen.

BliptoP3's picture

for one, highway robbery is much much quicker.

Uchtdorf's picture

Pity that none of the men being robbed carried a weapon. (BTW, it looks like the stage coach driver is in on it. "Hurry it up, will ya? It's cold out and I want to put me feetsies up in front o' the fire.")

DOT's picture

Maybe they could pass the hair-cut legislation in secret.

Then the secret financial police could (with ECB assistance ) make the collar.

No one needs to know............Shhhhhhhhh.


fonzannoon's picture

Is there a point where the market does not like this stuff?

WestVillageIdiot's picture

Yes.  And to the person that can find it there will be great riches.  And for all of those seeking that magic moment, and time it wrong, there lies much pain and hardship. 

Cpl Hicks's picture

It looks less like a Persian Messenger than Barry Obama wearing an east-African ghetto beanie but the lecturing with the pointer is very apt, given the academic credentials of our Dear TOTUS.

tobinajwels's picture

Does this mean a Default? Final Chapter?

fonzannoon's picture

The volatility index is on the floor with all this about to unfold. Makes sense.

WonderDawg's picture

Makes sense from a complacency/all is well perspective, which appeals to the contrarian in me.