John Pitera's Market Laboratory Message Board

STOCKTALK

We've detected that you're using an ad content blocking browser plug-in or feature. Ads provide a critical source of revenue to the continued operation of Silicon Investor. We ask that you disable ad blocking while on Silicon Investor in the best interests of our community. If you are not using an ad blocker but are still receiving this message, make sure your browser's tracking protection is set to the 'standard' level.

Strategies & Market Trends : John Pitera's Market Laboratory

Public Reply Prvt Reply Mark as Last Read File

Previous 10 Next 10 Previous Next

To: John Pitera who wrote (7188)	9/15/2005 12:51:39 PM
From: John Pitera	Read Replies (3) of 33421

I am pretty sure that the problems with credit default derivatives especially the inability to accurately assess counter-party risk and counter party solvency are going to be a major factor in the next financial system blow up. The timing of this will probably coincide with an upcoming quick 275- 300 basis point sprint in the 10 year yield. The bottom line is that with the daisy chaining of these sales and resales of the credit default protection contracts. Some players will end up overextended and unable to cover their default exposures. The Valuation issue begs for misuse and future litigation as hedge fund managers etc get sued for overstating the value of their contracts and getting paid 20 % of the inflated estimated value. John

Report TOU Violation

Share This Post

Public Reply Prvt Reply Mark as Last Read File

Previous 10 Next 10 Previous Next