Greece...

setmefree2

According to Peston

we should perhaps be hoping that Greece defaults tomorrow.
If you fear I've finally surrendered my sanity, here's why a Greek default might be a good thing.
What I mean by a default is that the International Swaps and Derivatives Association, ISDA, decides that there has been a so-called "credit event" relating to Greek government debt, and insurance contracts taken out against this debt, know as credit default swaps, or CDSs, are finally triggered.

if the Greek CDSs were not triggered, Houston there may be a problem.

The point is that Greece's private sector creditors feel they are being forced into accepting a dramatic writedown of what Greece repays them. And if that were not to trigger CDS payments, what would? Or such at least is the question posed by many bankers and investors.
To put it another way, if ISDA's decision-making committee rules that Greek CDSs are useless for compensating those who had bought the CDSs to protect themselves from the very events that are happening, then it is difficult to see how any CDS contract written on any sovereign credit would have a value.
That, for example, would mean that those who had bought $320bn of protection against default by the Republic of Italy would probably have to write off most of that $320bn, because the insurance contract would be seen to be almost useless.
And there would equally be huge losses for those holding $163bn of protection taken out against Spain, $45bn taken out against Ireland, $64bn taken out against the risk of a default by the UK, and so on.
So failure to declare a default on Greece could render useless and valueless $2.7 trillion of other sovereign insurance contracts - and writing those off might well bring down the odd financial institution and even threaten the health of the financial system.
Which is why, as I said, you should perhaps ask for a Greek default, in your prayers tonight, to prevent additional stress in the financial system.

http://www.bbc.co.uk/news/business-17304618

setmefree2

Legal skull-duggery in Greece may doom Portugal

Europe has ring-fenced Greece's debt crisis for now but its escalating recourse to legal legerdemain has shattered the trust of global bond markets and may ultimately expose Portugal, Spain, and Italy to greater danger.

The next spasm of the debt crisis will that much dangerous if it ever comes. As the saying goes: Hell hath no fury like an abused bondholder.

http://www.telegraph.co.uk/finance/comment/ambroseevans_pritchard/9132216/Legal-skull-duggery-in-Greece-may-doom-Portugal.html

zenmaster

We're off to a Greek restaurant tomorrow night.

Reckon I can get away with offering them 30% of the bill?

Graham_Devon

setmefree2 wrote: »

According to Peston



http://www.bbc.co.uk/news/business-17304618

This is all getting silly.

The EU fools have put us into a situation where we will have no where to go soon that doesn't end in needlessly larger losses for all of us.

Default and it's a problem. Don't default and it's equally a problem.

The bigger problem is that we keep feeding money into this to buy time. More and more money to be lost = a bigger disaster and more pain at the end of it.

Let's hope it defaults sooner rather than later. It's already gone on far too long. No doubt billions upon billions will be thrown at this yet, only serving to make us, the EU populace more at risk.

The simple idea here is to default on 107bn of debt so that they can get 130bn of debt.

It's just idiotic. Instead of Greek and EU officials celebrating this audacity, they should be outright ashamed of themselves. Were certainly living through a period that will be referenced in history.

Graham_Devon

"Today the problem is solved," French President Nicolas Sarkozy said.

What a &*%%$%$

Mrs_Bones

Graham_Devon wrote: »

"Today the problem is solved," French President Nicolas Sarkozy said.

What a &*%%$%$

...but a &*%%$%$ with an election to try and win


What really worries me is that he might actually along with some of the other EU heads believe the problem is solved. Saying crap to win an election is normal from politicians. It's when there is a chance that they actually believe what they are saying I find it gets scarey.

Arthurian

ISDA determinations committee says Greek credit event has occurred.

pqrdef

Graham_Devon wrote: »

"Today the problem is solved," French President Nicolas Sarkozy said.

Not quite, but it'll help if he turns his palace into a hostel for Greeks whose pension funds are now screwed.

sabretoothtigger

Its a default if they use CAC to force the extra 10% of bonds into agreement apparently

http://www.reuters.com/article/2012/03/09/greece-cds-isda-trigger-idUSL2E8E9EQ720120309

Default and it's a problem. Don't default and it's equally a problem.

The bigger problem is that we keep feeding money into this to buy time. More and more money to be lost = a bigger disaster and more pain at the end of it.

This was always true. They never had a solution better then bankruptcy.
At least when someone goes under you know the damage is done and over, its then down to the creditors to figure out why they bother to lend to them and avoid a future mistake

Graham_Devon

Arthurian wrote: »

ISDA determinations committee says Greek credit event has occurred.

Well thats a surprise.

Now they just got to figure out who owes who what, as apparently no one knows.

Apparently though, they have figured these CAC's will only cost £2-3bn? So makes you wonder what on earth all the fuss was about in the first place!??