Posts Tagged ‘Credit default swaps’

Eurozone bailout $955 billion (and counting)

Monday, May 10th, 2010

Full story here from ZeroHedge. Remember when this was $4bn for Greece (about a month ago)? Trying to transfuse the corpse big time. The financial Maginot Line has been constructed. That worked out well–oh wait…

From The Daily Capitalist

“The message has gotten through: the euro zone will defend its money,” French Finance Minister Christine Lagarde told reporters in Brussels early today after the 14-hour meeting.

The eurozone, those countries that use the euro as their currency, is in serious trouble as evidenced by Sunday night’s (here) announcement of a €750 billion bailout to defend the euro from tanking and taking down several sovereigns with it. Greece is only one problem. (more…)

Numerous Euro banks and re/insurers ID’d w/10’s billions in Greek failed repos

Thursday, May 6th, 2010

Full story here from ZeroHedge. It’s like picture day–at the local morgue.

BNP, Commerzbank, HSBC, SocGen, Natixis, BNP, CA, AXA, ING and Rabobank all identified as banks with massive Greek repo exposure. The next question: will writedowns on these now illiquid and, as the Greek bond market is effectively shut down for a second day running, untradeable positions be taken, or will Europe follow the US in pretending tens of billions in valuation gaps will be filled by Hopium? Also, as reports, and as we first highlighted, a variety of French re/insurers are about to get whacked. (more…)

CDS traders agree– the rest of Europe is in deep shit too

Thursday, May 6th, 2010

Full story here from ZeroHedge. OK, I think this is the appropriate music for this…”going down, down, draggin’ me down”

Portugal… Spain…Greece…these are all last week’s news based on CDS trading patterns. Indeed, this week saw the biggest trade unwinds of all top 1000 CDS entities (including all corporates) precisely in these three names. As the PIIGS implosion is finally being appreciated by everyone and their grandmother, the “speculators” are booking massive profits: the net cover/rerisking in Portugal and Spain was a massive $500 million net notional unwinds in each in the week ended April 30. Also known as taking profits. Greece and Ireland were also in the top 5, so as we have repeatedly claimed, the market will no longer make the news in Club Med. So where will it? No surprise there – the UK, France and Germany. The smartest money in the world is now actively betting the core of the eurozone is where the next CDS blow up will take place. With a stunning $630 million, $558 million and $370 million in net notional derisking, France, UK and Germany are the top three most active recipients in negative bets in the prior week, not just in sovereigns but in all names. The greatest non-sovereign derisker in the last week? Goldman Sachs, with $175 million. Nuff said. Yet a tangent on the UK: last week the UK saw $443 million in net notional derisking.  This week the number is even higher: $558 million. There is now over $1 billion in net risky bets made that the UK may not last. And Zero Hedge’s outside bet to be the first core country to blow up, thanks to its massive PIIGS exposure, France, finally made the top spot in net derisking, with $629 million in net notional, or 189 contracts. The smart money is now massively betting that Europe’s core is done for; as the PIIGS have demonstrated, the blow out in spreads for the core trifecta can not be far behind. (more…)

When the patina fades…the rise and fall of Goldman Sachs???

Tuesday, March 16th, 2010

Full story here from Reggie Middleton via ZeroHedge.

I have warned my readers about following myths and legends versus reality and facts several times in the past, particularly as it applies to Goldman Sachs and what I have coined “Name Brand Investing”. Very recent developments from Senator Kaufman of Delaware will be putting the spit-shined patina of Wall Street’s most powerful bank to the test. Here is a link to the speech that the esteemed Senator from Delaware (yes, the most corporate friendly state in this country). A few excerpts to liven up your morning… (more…)

California’s coming war on banks and pre-crisis swaps

Tuesday, March 9th, 2010

Full story here from Business Insider. Notice that the termination fees on these swaps are HUGE. This is not unlike the first Alien movie, and these municipalities are like John Hurt.

Is this man Wall Street’s #1 threat?


Meet LA Councilman Richard Alarcón.

He’s the one leading the city’s charge to repudiate a pre-crisis interest rate swap agreement that it made with Bank of New York Melon. Doing so would save the city $19 million per year, and with a budget gap of over $200 million, LA needs every dollar it can get its hands on.

The swap — one it made on a water bond pre-crisis — was supposed to protect the city against higher interest rates, though of course rate have collapsed, meaning the city remains on the hook for protection it doesn’t need. This is a hot topic, as numerous cities around the country are in a similar situation, a topic which Gretchen Morgenson covered yesterday. (more…)

Washington must ban US credit derivatives as traders demand gold

Monday, March 8th, 2010

Full story here from Janet Tavakoli. Like a hand grenade in a barrel of oatmeal…

Congress should act immediately to abolish credit default swaps on the United States, because these derivatives will foment distortions in global currencies and gold. Failure to act now will only mean the U.S. will be forced to act after these “financial weapons of mass destruction” levy heavy casualties. These obligations now settle in euros, but the end game is to settle them in gold. This is so ripe for speculative manipulation that you might as well cover the U.S. map with a bull’s-eye.   (more…)

No wonder the economy isn’t improving

Wednesday, March 3rd, 2010

Full story here from Zero Hedge.

“I’ve read countless news headlines recently about how economists are “surprised” over an “unexpectedly bad” economic indicator.

But it’s not surprising at all. It’s no mystery.

The government hasn’t taken the necessary actions, and has instead been doing all of the wrong things.

Let’s recap. (more…)

Financial firms receiving widespread subpoenas–euro-shorting collusion

Monday, March 1st, 2010

Full rumor here from ZeroHedge. Oh, for the day we can watch banksters get slapped around like some tart in a Marcello Mastroianni movie: “You stupid beeeetch!!!”

“As of last night, a variety of financial firms have received subpoenas seeking information on collusion to short the euro. We are currently pursuing more information and will post once we get it. Certainly sovereign CDS traders can not be far behind (especially those who traded with a less than bullish bias over the past month) from the wrath of the Greek, Spanish and British secret services, and now – various US legal and criminal administrations, which are currently convinced that it is just speculators who are at fault for 15 years of fraudulent eurozone budgetary presentations and countless bond offerings based on fake financials,  finally coming to the fore. Seriously, sell anything, and you will soon be facing the business end not of misdemeanor, but real-deal felony charges, and possibly with sprinkles of treason to boot.”

Wall St’s credit crisis bailout hustle

Monday, March 1st, 2010

Full story here from Matt Taibi via Market Oracle.

“Matt Taibbi writes: Goldman Sachs and other big banks aren’t just pocketing the trillions we gave them to rescue the economy – they’re re-creating the conditions for another crash.

On January 21st, Lloyd Blankfein left a peculiar voicemail message on the work phones of his employees at Goldman Sachs. Fast becoming America’s pre-eminent Marvel Comics supervillain, the CEO used the call to deploy his secret weapon: a pair of giant, nuclear-powered testicles. In his message, Blankfein addressed his plan to pay out gigantic year-end bonuses amid widespread controversy over Goldman’s role in precipitating the global financial crisis. (more…)

Geithner’s Gotta Go

Wednesday, February 24th, 2010

Full story here from Mike Whitney via CounterPunch.

“Would it be wrong to take out a $1,000,000 policy on your wife and then put strychnine in her double-tall nonfat mocha?

Not if you are Goldman Sachs it wouldn’t. In fact–according to an article on today’s Bloomberg News–that’s exactly what they did. They slapped together $17.2 billion in garbage CDOs and then insured the hell out of them with credit default swaps (CDS) issued by AIG. As soon as the CDS blew up, G-Sax collected 100 cents on the dollar for their ingenuity. (G Sax received $14B altogether) (more…)