Wednesday, February 29, 2012

Meanwhile….

Isda decides to decide on Greek credit event

ISDA Determinations Committee Accepts Question Related to a Potential Hellenic Republic Credit Event LONDON, February 28, 2012 – The International Swaps and Derivatives Association, Inc. (ISDA), as secretary to the Determinations Committees (the DCs), today announced that a question relating to a potential credit event with respect to the Hellenic Republic has been submitted to, and subsequently accepted for consideration by, the EMEA Determinations Committee. In accordance with the Determinations Committee Rules, a meeting will be held at 11AM GMT on Thursday, March 1 to determine whether a credit event has occurred.

Posted by dill @ 07:32 AM (1308 views)
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8 thoughts on “Meanwhile….

  • When you have bailout mechanisms, you need the bureaucracy to decide when the credit event is. In free market economics, they would have gone bust long ago and we would already be picking up the pieces working towards solutions

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  • mark wadsworth says:

    Awesome work there by Government Sachs!

    First they set up the Euro for huge fees, knowing it won’t work, then they help Greece fudge their books, knowing the fraud will be uncovered, then they sell loads of insurance to people holding Greek bonds and bank the premiums, then it all goes wrong, as predicted and intended, then they parachute in a couple of their own guys to run Greece and Italy, and then they arrange the default in such a way that it isn’t officially a default, then their own trade association ISDA confirms that it was not a default and so GS can keep the juicy insurance premiums without paying a penny.

    Next on the agenda – bank a few billion for sorting out the new Greek drachma. And so on.

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  • libertas – in free market economics the Greeks wouldn’t have gone bust in the first place despite the corruption and waste. The problem was the alliance of corrupt Greek rulers with the Germans, French, the US and to a lesser extent the UK intent on selling Greece weaponry and other products they didn’t need. (In the UK education expenditure is more than twice defence expenditure, in Greece defence expenditure is higher than education expenditure, and on some measures Greece is one of the world’s top 5 arms importers.) This alliance of crooked contractors and venal politicians led to high-interest loans to Greece’s rulers that hardly trickled down to the people. Many Greeks suspect that their leaders worked with the IMF to paint a bleak picture of government finances and to put out the ‘lazy, overpaid Greeks’ stereotype in order to drive Greece into the arms of the IMF and the banks (according to Mikis Theodorakis, the composer, Papandreou and his minister of finance have been indicted in Greece on the first count). This notion is certainly no more absurd than the damaging extend/pretend policy of the IMF/EU/ECB.

    That policy is about buying time until the banking system is stabilised to the extent that it can handle a Greek bankruptcy without setting of a chain reaction in which undercapitalised, over-extended, under-regulated banks fall over like dominoes through losses on bonds and credit insurance.

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  • Icarus, you are completely wrong. Absent bailouts they could not afford the interest payments and would have been forced into default at least a year ago.

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  • Mark. For once, a great post from you. But remember, it is big government that then turns itself on the people in this way. You can’t have it both ways. Any government, given too much power, partners with corporations.

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  • Jim Sinclair was warning about this moment over a month ago and in his interview he was slightly alarmist which apparently is not like him. We shall see…

    http://www.examiner.com/finance-examiner-in-national/jim-sinclair-isda-to-determine-this-week-if-five-major-us-banks-go-insolvent

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  • libertas – depends on the date at which you imagine the Greek economy is ‘free market’. If you start just one year ago then yes, the damage had already been done and they needed some kind of bailout. What if your starting date is four years ago?

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  • Libertass, it’s you who wants Big Government and some groups benefitting at the expense of others, not me or Icarus. You pretend you don’t, but you do really.

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