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

Your rating: None

- advertisements -

Comment viewing options

Select your preferred way to display the comments and click "Save settings" to activate your changes.
Fri, 02/17/2012 - 13:45 | 2170332 Temporalist
Temporalist's picture

Everyone's swapping spit but nobody wants the mono.

Fri, 02/17/2012 - 13:50 | 2170365 nope-1004
nope-1004's picture

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


Fri, 02/17/2012 - 13:57 | 2170406 trebuchet
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

Fri, 02/17/2012 - 14:06 | 2170456 There is No Spoon
There is No Spoon's picture

not in this case because this cac would be retroactive.

Fri, 02/17/2012 - 14:30 | 2170620 GOSPLAN HERO
GOSPLAN HERO's picture

It's time for Greece to flat line.

Fri, 02/17/2012 - 14:00 | 2170417 Chief KnocAHoma
Chief KnocAHoma's picture

Does this mean American Idol will be canceled?

Fri, 02/17/2012 - 13:46 | 2170336 WALLST8MY8BALL
WALLST8MY8BALL's picture

CDS with CAC's - Kind of funny!

Fri, 02/17/2012 - 19:39 | 2171831 masterinchancery
masterinchancery's picture

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

Fri, 02/17/2012 - 13:46 | 2170337 Harlequin001
Harlequin001's picture

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

Fri, 02/17/2012 - 13:46 | 2170338 falak pema
falak pema's picture

anti banksta fire wall of Troy!

Fri, 02/17/2012 - 13:46 | 2170340 PicassoInActions
PicassoInActions's picture

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

Fri, 02/17/2012 - 13:50 | 2170363 taniquetil
taniquetil's picture

It's only a matter of time.

Fri, 02/17/2012 - 13:57 | 2170408 WestVillageIdiot
WestVillageIdiot's picture

Not for the politicially connected. 

Fri, 02/17/2012 - 13:46 | 2170345 sankol
sankol's picture

So it begins!


Fri, 02/17/2012 - 13:50 | 2170369 Martial
Martial's picture

This is it!

Fri, 02/17/2012 - 14:06 | 2170446 Chief KnocAHoma
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



Fri, 02/17/2012 - 14:11 | 2170494 Martial
Martial's picture

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

Fri, 02/17/2012 - 14:25 | 2170592 Temporalist
Temporalist's picture

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

Fri, 02/17/2012 - 14:42 | 2170663 IrritableBowels
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"

Fri, 02/17/2012 - 15:19 | 2170871 Chief KnocAHoma
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.

Fri, 02/17/2012 - 13:48 | 2170348 JPM Hater001
JPM Hater001's picture

Somebody please... "CACs"

Fri, 02/17/2012 - 13:53 | 2170386 Conrad Murray
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

Fri, 02/17/2012 - 14:07 | 2170469 Chief KnocAHoma
Chief KnocAHoma's picture

Too freaking many cans and not enough feet!

Fri, 02/17/2012 - 13:56 | 2170401 The Swedish Chef
Fri, 02/17/2012 - 13:48 | 2170350 resurger
resurger's picture

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

Fri, 02/17/2012 - 13:48 | 2170354 EuroBear
EuroBear's picture

Time to load up EUR shorts.

Fri, 02/17/2012 - 13:49 | 2170360 asteroids
asteroids's picture

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

Fri, 02/17/2012 - 13:55 | 2170395 resurger
resurger's picture

They willl pay when hell freezes over.


Fri, 02/17/2012 - 13:59 | 2170413 NotApplicable
NotApplicable's picture

GS was paid nicely by AIG, errr... make that you.

Fri, 02/17/2012 - 14:08 | 2170475 Chief KnocAHoma
Chief KnocAHoma's picture


Fri, 02/17/2012 - 13:50 | 2170362 trebuchet
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

Fri, 02/17/2012 - 13:51 | 2170373 rubearish10
rubearish10's picture

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

Fri, 02/17/2012 - 13:52 | 2170375 Cognitive Dissonance
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


Fri, 02/17/2012 - 13:56 | 2170400 nevadan
nevadan's picture

It is legal...(cough cough)

Fri, 02/17/2012 - 13:56 | 2170403 BlackSea
BlackSea's picture

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

Fri, 02/17/2012 - 14:02 | 2170425 WestVillageIdiot
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. 

Fri, 02/17/2012 - 14:10 | 2170492 gmrpeabody
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.

Fri, 02/17/2012 - 13:59 | 2170415 BliptoP3
BliptoP3's picture

for one, highway robbery is much much quicker.

Fri, 02/17/2012 - 14:00 | 2170416 NotApplicable
NotApplicable's picture

You'll get a receipt?

Fri, 02/17/2012 - 14:39 | 2170648 Uchtdorf
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.")

Fri, 02/17/2012 - 13:51 | 2170376 DOT
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.


Fri, 02/17/2012 - 13:52 | 2170381 fonzannoon
fonzannoon's picture

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

Fri, 02/17/2012 - 14:03 | 2170439 WestVillageIdiot
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. 

Fri, 02/17/2012 - 22:08 | 2172108 WonderDawg
WonderDawg's picture


Fri, 02/17/2012 - 13:53 | 2170384 williambanzai7
williambanzai7's picture


Fri, 02/17/2012 - 19:32 | 2171814 Cpl Hicks
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.

Fri, 02/17/2012 - 13:53 | 2170388 tobinajwels
tobinajwels's picture

Does this mean a Default? Final Chapter?

Fri, 02/17/2012 - 13:53 | 2170389 fonzannoon
fonzannoon's picture

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

Fri, 02/17/2012 - 22:10 | 2172113 WonderDawg
WonderDawg's picture

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

Do NOT follow this link or you will be banned from the site!