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| User Info | More Bernanke Follies - Bank Debt Rollover in forum [Ticker] | |||
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Genesis Posts: 71435 Incept: 2007-06-26 
KD^2 
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http://market-ticker.org/archives/1610-M....
---------- "The monetary base in ALL modern monetary systems is the sum of unencumbered assets against which one is both WILLING AND ABLE to borrow." - Me
2009-11-10 14:29:37
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Sqmo Posts: 388 Incept: 2009-09-14
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I'm guessing that could impact profit margins at AIG.
2009-11-10 14:46:29
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Rutben Posts: 900 Incept: 2007-07-27
Phoenix, AZ
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Hadn't been thinking about the interest rate swaps because they are considered so "normal" and "low risk", however that will not be a good day for the official who has to announce the taxpayer bailout for those counterparties. They claim there is much less risk because they will "net out", but when all the counterparties are devoid of capital, how do you net them out without taxpayers? I guess you could have offsetting voided contracts but we know that will not happen and financial institution balance sheets probably could not even take that hit.
2009-11-10 14:53:18
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Genesis Posts: 71435 Incept: 2007-06-26
KD^2
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The IR derivatives are the 900lb Gorilla in the room. They're ****ing HUGE and the novations and such all wind up SOMEWHERE. Who is holding that bag? ---------- "The monetary base in ALL modern monetary systems is the sum of unencumbered assets against which one is both WILLING AND ABLE to borrow." - Me
2009-11-10 15:10:40
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Pika-steph Posts: 39200 Incept: 2007-09-11 
^Why I keep^ fighting; so he is not fighting for nothing.
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Come January 1st they're going to have the CRE paper rollover nightmare too.
---------- Stop the Looting; Start Prosecuting - http://www.FedUpUSA.org  "America is at that awkward stage. It's too late to work within the system, but too early to shoot the bastards."
2009-11-10 15:11:57
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Lowbeyond Posts: 6905 Incept: 2008-02-11 
CO Online
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I like how the future minefield keeps getting denser. It will make for interesting times ---------- Maybe it was a birdy bread-bomber from the future?!
2009-11-10 16:08:09
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Mondocondo Posts: 3143 Incept: 2007-12-03
Miami
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Deleted--wrong thread.
Last modified:
2009-11-10 16:27:51 by mondocondo
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Cobradriver Posts: 51 Incept: 2009-08-04 Port Charlotte,Fl
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Quote:Who is holding that bag? James Brown? Sorry... Chris
2009-11-10 17:10:22
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Mrholty Posts: 1015 Incept: 2007-07-27
Wisconsin
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Here is the thing that has me struggling recently. The guys who made the most money last year were the guys who sold MBS in 2006 and waited for it to turn. I couldn't do that because I don't have the $ but how can I win on this. This is the part that I am willing to wait on.
2009-11-10 17:58:06
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Larsenebezzle Posts: 168 Incept: 2009-05-05
Land of Oz
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I think the IR derivatives explain why Bernanke and the FOMC are holding the interest rate at 0% even if it means a carry trade in the dollar. Even a small rise in interest rates blows up the IR derivatives exposing the counterparties as insolvent, which instantly blows up the world’s financial system. Total destruction. Bernanke's action is a desperate plan to stave off total collapse. He is a drowning man clutching at straws and he thinks the carry trade in the dollar is a better alternative, destructive as it is to America, than a total collapse of the world’s economy. ---------- I am heavily positioned in lead and lead delivery systems.
2009-11-11 13:05:55
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