Απάντηση στον Πόρτα – Πόρτα για τα CDS

Από τον GG

Πόρτα – Πόρτα,

RE:  Καποια ονοματα… και ΜΙΑ ΑΛΗΘΕΙΑ !

ΚΑΙ ΤΩΡΑ Η ΟΜΟΡΦΙΑ…!!!
– “Who will lose out if the insurance is paid out????? ” he said.
– “The two biggest issuers are Goldman Sachs and AIG.

They are effectively being given a bailout by not allowing Greek debt to default. Seven Goldman Sachs ex-employees are in European Union governments. This is crony banking at its worst.”- χαχαχααααααααααααααααααααααααααααχχααα ΠΑΠΑΔΗΜΟΣ !!!

 
Bloomberg begins with some simple math: the concept that is seemingly most disturbing to the status quo, not only in Europe, but now in the US as well.

Guarantees provided by U.S. lenders on government, bank and corporate debt in those countries rose by $80.7 billion to $518 billion, according to the Bank for International SettlementsAlmost all of those are credit-default swaps, said two people familiar with the numbers, accounting for two-thirds of the total related to the five nations, BIS data show.
 
The payout risks are higher than what JPMorgan Chase & Co. (JPM), Morgan Stanley and Goldman Sachs Group Inc. (GS), the leading CDS underwriters in the U.S., report. The banks say their net positions are smaller because they purchase swaps to offset ones they’re selling to other companies.

Which explains why the banks are if not lying, then taking advantage of a gullible public to misrepresent their exposure by as much as a factor of ten!

Five banks — JPMorgan, Morgan Stanley, Goldman Sachs, Bank of America Corp. (BAC) and Citigroup Inc. (C) — write 97 percent of all credit-default swaps in the U.S., according to the Office of the Comptroller of the Currency. The five firms had total net exposure of $45 billion to the debt of Greece, Portugal, Ireland, Spain and Italy, according to disclosures the companies made at the end of the third quarter. Spokesmen for the five banks declined to comment for this story.

Well naturally the banks will represent a far lower and far more manageable number than the one which is sure to inspire nothing short of panic. We wonder: was MF Global’s $6 billion in Italian exposure part of this net exposure? Does this mean that America’s top banks, sans MF, have just, don’t laugh, $39 billion in exposure?
So let’s go back to the math to see what the real exposure is:

The CDS holdings of U.S. banks are almost three times as much as their $181 billion in direct lending to the five countries at the end of June, according to the most recent data available from BIS. Adding CDS raises the total risk to $767 billion, a 20 percent increase over six months, the data show. BIS doesn’t report which firms sold how much, or to whom. A credit-default swap is a contract that requires one party to pay another for the face value of a bond if the issuer defaults.

Shhh, don’t tell anyone, but not only is the total gross exposure many, many times than what the banks have represented, but in fact US banks have been aggressively selling protection in the first half of 2011!
And here is where the lies get downright surreal:

While the lenders say in their public disclosures they have so-called master netting agreements with counterparties on the CDS they buy and sell, they don’t identify those counterparties. About 74 percent of CDS trading takes place among 20 dealer- banks worldwide, including the five U.S. lenders, according to data from Depository Trust & Clearing Corp., which runs a central registry for over-the-counter derivatives.
In theory, if a bank owns $50 billion of Greek bonds and has sold $50 billion of credit protection on that debt to clients while buying $90 billion of CDS from others, its net exposure would be $10 billion. This is how some banks tried to protect themselves from subprime mortgages before the 2008 crisis. Goldman Sachs and other firms had purchased protection from New York-based insurer AIG, allowing them to subtract the CDS on their books from their reported subprime holdings.

 the International Swaps & Derivatives Association, or ISDA, decides whether a debt restructuring triggers CDS payments. The committee that will rule on the Greek deal is made up of 10 bank representatives and five investment managers and needs 12 votes to reach a decision. 
ISDA Determinations Committees (effective 30 November 2011)
EMEA (Europe)


Voting Dealers
Bank of America / Merrill Lynch
Barclays
BNP Paribas
Credit Suisse
Deutsche Bank
Goldman Sachs
JPMorgan Chase Bank, N.A.
Morgan Stanley
Société Générale
UBS


Consultative Dealers
Citibank
The Royal Bank of Scotland
Voting Non-dealers
BlueMountain Capital (Second Term Non-dealer)
Citadel LLC(First Term Non-dealer)
D.E. Shaw Group (First Term Non-dealer)
Elliott Management Corporation (Third Term Non-dealer)
Pacific Investment Management Co., LLC (Second Term Non-dealer)
15 – 4 = 11  (…and needs 12 votes to reach a decision.)

ΔΙΑΒΑΣΤΕ ΑΚΟΜΗ

ΣΧΟΛΙΑΣΕ ΤΟ

ΔΗΜΟΦΙΛΗ

ΔΗΜΟΦΙΛΗ