Greece financial crisis | Latest : Deal reached with even tougher conditions for Greece.

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So who will be cashing in if Greece defaults? :patrice:
Whoever owns CDSs on Greek sovereign debt will cash in. You don't need to own the underlying security to buy the CDS. In that case, the buyer is betting on default and will make sizable profits if it happens.
 

mbewane

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Whoever owns CDSs on Greek sovereign debt will cash in. You don't need to own the underlying security to buy the CDS. In that case, the buyer is betting on default and will make sizable profits if it happens.

That's the thing, I'm interested in knowing who actually would benefit from the default, as in names and where they from. That could explain a lot.
 

Domingo Halliburton

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So who will be cashing in if Greece defaults? :patrice:

not sure because of how little Greek debt being in private hands. It would look pretty bad for someone like the ECB looking like they're profiting on Greek defaults so I doubt these government entities are playing much in the swaps markets.

here's an article on it, it sounds like not many people will cash in because the ECB can do things like swap the bonds out with new ones which isn't considered a credit event and wouldn't trigger a payment.

http://www.reuters.com/article/2015/02/12/markets-greece-cds-idUSL5N0VL2FK20150212
 
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That's the thing, I'm interested in knowing who actually would benefit from the default, as in names and where they from. That could explain a lot.
I would imagine there isn't a way to find that information, as these contracts are traded over-the-counter. Safe to say that it's the usual who's who of hedge funds and institutional bond holders.
 

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I would imagine there isn't a way to find that information, as these contracts are traded over-the-counter. Safe to say that it's the usual who's who of hedge funds and institutional bond holders.

from the article:


BlackRock, Loomis Sayles and Carmignac Gestion are among the asset management firms that hold Greek bonds....

also:

But with no precedent for sovereign default on publicly-held debt triggering CDS payments, many market participants have been uncertain whether their default insurance would pay out in such a scenario.

....
However, a special provision introduced soon after the 2012 restructuring says any obligation undertaken by Greecebefore Feb. 1, 2012 would not trigger CDS payments.
 
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not sure because of how little Greek debt being in private hands. It would look pretty bad for someone like the ECB looking like they're profiting on Greek defaults so I doubt these government entities are playing much in the swaps markets.

here's an article on it, it sounds like not many people will cash in because the ECB can do things like swap the bonds out with new ones which isn't considered a credit event and wouldn't trigger a payment.

http://www.reuters.com/article/2015/02/12/markets-greece-cds-idUSL5N0VL2FK20150212
Isn't the ISDA controlled by the swaps dealers themselves? Kind of a conflict of interest there when they get to weigh in on what constitutes a credit event while they are most likely the ones to be paying out the contracts.
 

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Isn't the ISDA controlled by the swaps dealers themselves? Kind of a conflict of interest there when they get to weigh in on what constitutes a credit event while they are most likely the ones to be paying out the contracts.

yes. If I remember correctly with the default with Argentina I think Jamie Dimon himself was on ISDA basically deciding if JP Morgan should get paid on their swaps or not. huge conflict of interest.

edit: now that I look at it I don't think it was Dimon but yeah it is pretty much made up of the dealers.
 
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yes. If I remember correctly with the default with Argentina I think Jamie Dimon himself was on ISDA basically deciding if JP Morgan should get paid on their swaps or not. huge conflict of interest.

edit: now that I look at it I don't think it was Dimon but yeah it is pretty much made up of the dealers.
Regulatory oversight:troll:
 

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I saw gold slam down this morning and then I saw this was the reason why.

Who does this? Are you not trying to save your country?

They are saving it. They're making those fakkits eat the debt and theres nothing they can do about it.

@krackdagawd Drop that ward smiley :mjlol:
 
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