"If you're going to panic, do it fast and beat the crowd." ~ Jesse Livermore

Saturday, October 29, 2011

MF Global Draws Down on its Credit Lines

Corzine's MF Global Draws Down on Credit Lines - Bloomberg:
Bonds of MF Global Holdings Ltd. (MF) declined to as low as 35 cents on the dollar after the futures broker run by Jon Corzine drew on its credit lines and Moody’s Investors Service and Fitch Ratings cut the firm’s ratings to junk.

Fitch: 50% Greek Bond Haircut May Equal Default - Bloomberg:
European leaders’ agreement on a 50 percent haircut on Greek bonds may create an event of default if investors accept it, Fitch Ratings said in a statement today.

1. The problem is not solved . . . .2. The markets know it --(watch the Italy/Germany spread). . . .

Credit-Default Swaps as Hedge Threatened by Greek Debt Plan
San Francisco Chronicle
The talks were regarded by many investors as a last-ditch attempt to stem the sovereign crisis, while preventing the contagion to Spain, Italy and Portugal that they worried a trigger for swaps would cause. The involvement of the IIF, which represents ...
Fitch: Greek Debt Deal a Default
Wall Street Journal
"The agreement to materially increase the size of the EFSF's lending capacity to around €1 trillion is a critical first step to enhance market confidence in the ability of policy makers to limit the risk ofcontagion spreading to the core euro-area ...
Erste cuts credit default swap exposure
Financial Times
The Austrian bank said its exposure to credit default swaps – a derivative that pays out if a debtor defaults – had dropped to just €300m, compared with €5.2bn when its position was revealed in a profit warning on October 10. Analysts said the size and ...
Sovereign, Bank Bond Risk Rises in Europe, Reversing Declines
BusinessWeek
By David Goodman Oct. 28 (Bloomberg) -- The cost of insuring against default on European sovereign and bank debt rose, reversing earlier declines, according to traders of credit-defaultswaps. The Markit iTraxx SovX Western Europe Index of swaps on 15 ...
Greek debt haircut constitutes default: Fitch
Globe and Mail
New York, Paris— AP The euro fell against the dollar EUR/USD-I Friday after Fitch ratings agency said the deal reached by European leaders Thursday to cut Greece's debt load would constitute a default for the country. The plan asks Greece's private ...
As student debt grows, so does the number of students who default on loans
Muskegon Chronicle - MLive.com
Growing default rates show the extent of which former students are struggling to pay off student debt, which has grown to monumental proportions in recent years. And because student loans can't be written-off in bankruptcy court, the debt weighs on ...
Commonwealth can grapple with financial crisis: UK
IBNLive.com
Perth: The Commonwealth, which spans 54 countries with a trade network worth $3 billion, can tackle global challenges ranging from the financial crises to a changing climate, said British Foreign Secretary William Hague. Hague made the remark at the...
Greek Creditor Treatment Raises Contagion Risk, BNP Paribas Says
BusinessWeek
“The tough treatment of Greece's creditors increases contagion risks.” European officials ended all-night talks in Brussels yesterday with an agreement to recapitalize banks, boost the euro-area rescue fund and deliver additional financial support to ...
Dousing A Thermonuclear Explosion With A Fire Hose
Seeking Alpha
It also redistributes wealth from non-PIIGS citizens to PIIGS citizens by having the former essentially assume the liabilities of the latter. Since EFSF does very little to actually reduce the probability of an eventual default, then we must ask what ...
Fitch Regards Haircuts on Greek Debt as Default
Firedoglake
If the haircuts are seen as a default event, it would trigger certain credit default swaps, which since we actually don't even know who holds what in that regard (!), would be wildly unpredictable and dangerous. So one of the rating agencies saying ...
Iceland provides lessons for dealing with slumps - Paul Krugman
Houston Chronicle
The doctrine in question amounts to the assertion that, in the aftermath of a financial crisis, banks must be bailed out but the general public must pay the price. So a crisis brought on by deregulation becomes a reason to move even further to the ...
PIIGS At The Trough
Seeking Alpha
The effect of the grand bargain will be to reduce the Greek debt burden all the way down to – drum roll, please – 120% of GDP by 2020, a level typically associated with unsustainable debt dynamics and eventual default. So you can see, ...
Dodd Frank Victory as MF Global Avoids Contagion
TheStreet.com
That is because although MF operates as a broker in the derivatives markets -- where financial contagion can spread like wildfire -- the firm mostly trades exchange traded derivatives moved through a securities "clearinghouse. ...
War of the Words: Haircut Means Default
NewsMax.com
Sounds like a nice term, at least compared to what it really is: A default. Language is precise, and substituting different words makes a vast difference to change perception. Greece's “haircut” is a staggering 50 percent. Imagine putting a substantial ...
The Recent Global Financial Crisis: Impacts On Selected Developing Regions ...
Insurance News Net (press release)
The global financial crisis hit portfolio flows very hard in late 2008 and early 2009, confirming that mere was global financial contagion with a universal flight to safety. Banking stresses were also seen in low-income countries that were expected to ...
Polish Government May Surprise on Fiscal Cuts, Barclays Says
BusinessWeek
Credit-default swaps insure against non-payment. Barclays also recommends buying the zloty and selling the forint as Poland is more resilient to contagion from the euro region's debt crisis, Hewitt wrote. “The external contagion risks for the region ...
Being Pessimistic To Build Optimism
istockAnalyst.com (press release)
The new European plan to deal with the potential of sovereign default and the increasing doubts about solvency of financial institutions was announced two days ago. Financial markets so far seem to like the plan. The plan did not provide many surprises ...
DBRS RMBS ratings now includes loan-level default data
Housing Wire
by KERRI PANCHUK Ratings agency DBRS enhanced its loss model and rating methodology for residential mortgage-backed securities this week to include RMBS Insight, which measures defaultprobability statistics at the loan level. ...
Citi: Muni Bonds Still Facing Default Dangers
NewsMax.com
By Forrest Jones Municipal bonds, once a safe-haven investment only to be branded risky by many experts in wake of the Great Recession, have held up despite famously bearish calls, but they're not out of the woods yet, says George Friedlander, ...
EU Bishops calls for long term political vision to deal with financial crisis
Independent Catholic News
COMECE Bishops have called on the European Union and its citizens to refrain from blaming one another, and instead assume co-responsibility for finding solutions to the current financial crisis. They also call on European leaders to adopt a long-term ...
Government had a role in financial crisis
WatertownDailyTimes.com
Mark MacWilliams, in a recent letter, refers to Congress deregulating the financial industries but offers no specifics. In fact, since 1980, Congress has passed four new sets of regulations for every one deregulatory act, and between 2001 and 2008 ...
Short sales put many homebuyers in same boat
Lodi News-Sentinel
The San Diego Associated Press reported that Banks sent nearly 26 percent more default notices to California homeowners in the third quarter compared with the previous three months, stepping up actions against those with delinquent loans in what may ...
Financial market gains ground
The Korea Herald
The fall in CDS premium came as European leaders agreed on a write-down of 50 percent of banks' Greek bond holdings and other measures aimed at tackling the protracted crisis that raised the specter of another financial crisis...
Asia-Pacific Bond Risk Falls, Credit-Default Swap Prices Show
Bloomberg
By Yusuke Miyazawa - Fri Oct 28 01:10:20 GMT 2011 The cost of insuring Asia-Pacific corporate and sovereign bonds against non-payment declined, according to credit-default swap traders. The Markit iTraxx Japan index dropped 18 basis points to 157 basis ...
CMBS defaults fall and spreads tighten
Housing Wire
by KERRI PANCHUK Commercial mortgage-backed securities are benefiting from tightening spreads and a slowing loan default rate, analysts said this week. Trepp, an analytics firm that measures CMBS, reported that the CMBS market on Thursday "had one of ...
An Austrian Perspective on the Financial Crisis - Coordination ...
By Peter Boettke
Peter Boettke| Here is Larry White providing some perspective on the ongoing financial crisis. Austrian Economics and the Financial Crisis from FEE on Vimeo. I will be speaking myself on the topic later today at Delaware State University ...
Coordination Problem
Fitch says 50% Haircuts would Constitute Default; No Official Ruling ...
By noreply@blogger.com (Michael Shedlock)
Under the broad deal reached this week to stem the euro-zone's financial crisis, holders of credit-default swaps on Greek government bonds aren't expected to receive any payout, even though a preliminary agreement between financial ...
Mish's Global Economic Trend Analysis
Greek Default Watch: Greece After the Haircut: Numbers and Politics
By Nikos Tsafos
Greece was able to default without defaulting – it got strong multilateral support and was able to engineer a “voluntary” haircut without going into official default. It was also able to retain the 21 July agreement and it was able to resolve all ...
Greek Default Watch
Truisms of a Financial Crisis | Bear Market Investments
By admin
“It is a central irony of financial crisis that while it is caused by too much confidence, too much borrowing and lending, and too much spending, it can only be resolved with more confidence, more borrowing and lending, and more spending. ... Two out of five Americans with federal student debt can't make monthly payments and either defer, default or are delinquent, according to Mark Kantrowitz, publisher of Fastweb.com, a free scholarship-matching service, and FinAid.org, a source of ...
Bear Market Investments
default but not really a default | ForexLive
So Fitch is saying the Greek haircut is a default event, bond holders will “voluntarily” lose 50% but the ISDA says credit default swaps will not be. ... Not to mention the fear contagion that would come with it. @asier,. I agree it is a default...
ForexLive
The Weak Sisters Should Leave the Eurozone and Default – Here's ...
By Elliott Morss
In this second article in the two-part series on why Greece, Ireland, Portugal and Spain should leave the Eurozone, I offer specifics on how it should be done.
Morss Global Finance
Default, Credit Event, And Too Big to Fail | TF Market Advisors
By admin
It looks like Fitch would declare a 50% write-down a default. And yes, it is a default. No matter how anyone wants to spin it – restructuring, PSI, etc., it is definitely a default. It is NOT a Credit Event. Maybe the name should be changed from ...
TF Market Advisors
Debt Plan Could Deny Those Who Bet on Default — Clearing and ...
By RSS Feed
And many investors have bet against Greece, using billions of dollars in complex financial instruments, called derivatives, that turn a profit when there is a debt default. Worried about the ripple effects of any such default, European leaders announced on Thursday a plan for a voluntary ... I'm all for people betting, but when betting leads to worldwide contagion, I think it needs to be stopped.” Whether investors will really lose interest in derivatives on sovereign debt in Europe is unclear. ...
Clearing and Settlement — Clearing...
Eurozone crisis: contagion must not be allowed to spread, says ...
PM challenged on coalition divisions over Europe at prime minister's questions before heading to Brussels for summit.
www.guardian.co.uk/.../eu-debt-crisis-contagion-cameron-pm...
How European Contagion Could Bring Down The US Treasury ...
Accordingly, it is my belief that if the contagion spreads from Greece to .... is a delicate and politically painful process, by default it almost certainly will not happen ...
www.minyanville.com/businessmarkets/.../us.../37559?...

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