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Politics : Dutch Central Bank Sale Announcement Imminent?
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To: Cynic 2005 who wrote (2630)12/14/1998 9:32:00 AM
From: Zardoz  Read Replies (1) of 81913
 
"LTCM derivative exposure was believed to be over $1 tril."

No, their exposure to a short position in Bonds was believe to be that amount, not their exposure to derivatives. {even the press gets this wrong} But buying or shorting a bond on margin is called a derivative. And as such you can assume the worse case scenario of US default when you come to that $1 Trillion number, if you are so inclined.

""Secured assets" in a highly leveraged and over exposed derivatives market is an oxymoron!"

Once again: How many people realize that a margin account is a form of derivative? How many understand that you can buy/short bonds on nearly a 10% or less margin?

Got more questions: #Subject-22689
Addition: Don't assume that I am defending the Gambling house called LTCM. They where not a hedge fund for years, but a speculation "fund".
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