• EconMatters
    04/27/2015 - 14:18
    If the DOJ and CFTC is going to be consistent, then they have to indict the entire financial community from the CME, Exchanges, Brokers, Institutions, Investment Banks, Hedge Funds, Management Funds...

Sovereign Risk

Tyler Durden's picture

Sovereign Risk Update





I will keep harping on this theme until such time as harping is no longer necessary. Equity market rippage has resulted in essentially zero change in overall country risk profiles (and deteriorating risk in Japanese risk). There is a massive disconnect between equities and credit, especially sovereign credit which is becoming a defacto proxy for corporate risk via extended short-term guarantee programs and assumed liabilities.

 
Tyler Durden's picture

Sovereign Risk Update





I will keep harping on this theme until such time as harping is no longer necessary. Equity market rippage has resulted in essentially zero change in overall country risk profiles (and deteriorating risk in Japanese risk). There is a massive disconnect between equities and credit, especially sovereign credit which is becoming a defacto proxy for corporate risk via extended short-term guarantee programs and assumed liabilities.

 
Tyler Durden's picture

The Inversion Of Corporate and Sovereign Risk, Or The Sovereign Basis Trade





The recent spillover of the threat of an Eastern European collapse, and its gradual spread into the Eurozone, has manifested itself best in the dramatic widening of sovereign CDS. The so-called socialization of risk had resulted in a tightening of corporate and bank default risk at the expense of the respective sovereign domiciles.

 
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