This space is reserved for dodge1664 to introduce himself.
One of the key investment decisions of the last 10 years was to get out of financial stocks by 2007 at the latest. Woodford got that one right as he likes to take a macro economic angle on things. He didn't however get back in in 2009, so didn't benefit from the rebound as much as he might have done. Soc Gen produced their quality…
I'll take a punt on FTSE 4500 or maybe below by year end. I am bearish because (1) we have yet to see a workable solution to the Eurozone crisis. A true fiscal union will be needed, and I don't see the Germans accepting that until we're on the brink of disaster. (2) the US is beginning its fiscal austerity, and there is political opposition…
some more on this topic:http://www.bondvigilantes.com/2011/10/28/if-sovereign-cds-is-no-longer-an-effective-hedge-then-whos-in-trouble/ So the guys most at risk of sovereign CDS losing its credibility as a hedge are in all likelihood the large European banks. It’s the last thing these banks need right now. What will be really interesting is whether or not the banks’ use of sovereign CDS as an effective hedge in accounting definitions remains allowable now that politicians have…
.so it isn't the case that, as dodge suggests "there must be some consequences to effectively declaring that all previously written contracts are null and void".....because the contracts will have been adhered to - to the letter! ok, let me re-phrase: there must be some financial institutions who were relying on a CDS payout in this situation, and who now won't get one. There must…
Maybe the CDS market should never have existed, but there must be some consequences to effectively declaring that all previously written contracts are null and void. Won't large writedowns of Greek debt without any compensating CDS payout appear somewhere in the system?
