The ISDA has, in fact, determined a "credit event has occurred with respect to Greece," and...

The ISDA has, in fact, determined a "credit event has occurred with respect to Greece," and schedules an auction date of March 19 for the defaulted bonds to set the CDS payout price. (earlier)

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Comments (22)
  • SoldHigh
    , contributor
    Comments (991) | Send Message
    This overdue decision merely acknowledges reality. Amazing and disturbing that it took this long.
    9 Mar 2012, 02:54 PM Reply Like
  • Vitautas
    , contributor
    Comments (137) | Send Message
    Huh? So far they payed all matured bonds and interests. It's not the task of the ISDA to foresee the future.
    10 Mar 2012, 07:28 AM Reply Like
  • Stoploss
    , contributor
    Comments (1713) | Send Message
    Hope every one has their crash helmets handy.
    9 Mar 2012, 02:55 PM Reply Like
  • blueguy19
    , contributor
    Comments (27) | Send Message
    This was in the making, but recent weeks it wasn't that clear because of the stance ISDA members were taking and credit analyst expectations.


    If you look at it, it merely caused $3B CDS payouts compared to raw Greece deal where private investors are taking more than $100B forced write down in lieu of new bonds with lower coupon but yield as high as 14% to 17% (when they start trading in secondary markets - causing further inherent write down of about 30% to 40% face value of new bonds).


    Further more as Bill Gross said, it put permanent dent on sanctity of the Bond Contracts.
    9 Mar 2012, 03:06 PM Reply Like
  • Bird-man
    , contributor
    Comments (1162) | Send Message
    Might be only 3 billion. We will see. It could just be the thin edge of the wedge too. The market looks unfazed, even bullish at the moment but we should note the spike in the dollar today and that is a warning. Especially as gold also rose. There must be some conflicts in the algos over this one or we really do need to get out the crash helmets by months end.
    9 Mar 2012, 03:38 PM Reply Like
  • Comotoast
    , contributor
    Comment (1) | Send Message
    "Might be only 3 billion"


    It's good to hear some else questioning this figure. If CDS is supposed to be insurance and the assets in questions total well over 100 billion, Then where's the rest? Not to mention all the "naked CDS" and side bets that were allegedly in the system.


    This is the same as getting 30k worth of insurance on a million dollar house. It doesn't fit.
    10 Mar 2012, 02:29 PM Reply Like
  • Bird-man
    , contributor
    Comments (1162) | Send Message
    Thanks Comatoast. This story is not all told yet. More to come.
    11 Mar 2012, 12:41 AM Reply Like
  • 2PP
    , contributor
    Comments (343) | Send Message
    I'm surprised they announced it before the markets closed, kind of like an Obama Friday night document dump. Fewer people watch the weekend news and it kind of slips by unreported.
    9 Mar 2012, 03:06 PM Reply Like
  • Jason B
    , contributor
    Comments (629) | Send Message
    $3B? LOL big deal.
    9 Mar 2012, 03:07 PM Reply Like
  • schatzl
    , contributor
    Comments (391) | Send Message
    Yes, 3billion $ is no big deal,


    just funny they know the exact net position, when that what the industry fears most is the lack of transparency in the unregulated market. So far the market is believing that number. It could well just be a storm in a teacup, but we'll eventually find out on Monday.
    10 Mar 2012, 04:52 AM Reply Like
  • NIRP
    , contributor
    Comments (632) | Send Message
    9 Mar 2012, 03:15 PM Reply Like
  • blueguy19
    , contributor
    Comments (27) | Send Message
    Did you lose money and have to pay out part of $3B?
    9 Mar 2012, 03:19 PM Reply Like
  • chucksteaks
    , contributor
    Comments (3) | Send Message
    ifin u wer plyin da mrkt, u wanted to watch wat was hapin in.?! opitions waz da way to go.
    10 Mar 2012, 08:26 AM Reply Like
  • thechaser
    , contributor
    Comments (769) | Send Message
    check out zerohedge's comment on KA Finanz; enlightening; also has some very detailed data as does on the nuances of this credit insurance; and Gross called the pig the pig when he said man, the private money world will begin to question all bonds
    9 Mar 2012, 06:22 PM Reply Like
  • chucksteaks
    , contributor
    Comments (3) | Send Message
    kep watchin des dudes an da wil tak u der?! good luck! an english major.
    10 Mar 2012, 08:26 AM Reply Like
  • JohnLocke
    , contributor
    Comments (383) | Send Message
    The real question is would the ISDA have declared a credit event and triggered CDS if less then 65% of the bonds would have been swapped?


    Was the Swap in essence simply a shell game to limit ISDA member banks exposure to a much larger problem.


    --Is there a list available of all of the bond holders who swapped their bonds?
    -- Any bets that the vast majority of the swappers were the same banks that would be making the CDS payouts...


    Bank of America / Merrill Lynch
    BNP Paribas
    Credit Suisse
    Deutsche Bank
    Goldman Sachs
    JPMorgan Chase Bank, N.A.
    Morgan Stanley
    Society de General
    9 Mar 2012, 11:46 PM Reply Like
  • Dr. V
    , contributor
    Comments (1168) | Send Message
    As predicted and reported via Brussels, and after being called a lunatic just yesterday.
    10 Mar 2012, 04:06 AM Reply Like
  • dividend_growth
    , contributor
    Comments (2894) | Send Message
    CDS is so yesterday.


    People still freaking out about it should stay away from financial markets, both for their financial and physical health.
    10 Mar 2012, 07:03 AM Reply Like
  • Tack
    , contributor
    Comments (16551) | Send Message
    You have a point.


    Those waiting for some calamitous event from Greek CDS are in for serious disappointment. First, those writing CDS contracts learned from the subprime experience, and the Greek outcome was foreseen for so long that most major exposures were hedged out long ago. The media, their usual quest for generating hysteria, constantly talks about the gross "notional" values on CDS, as "trillions," but these have almost no bearing on actual net exposures.
    10 Mar 2012, 07:44 AM Reply Like
  • schatzl
    , contributor
    Comments (391) | Send Message
    Just have another look at MF Global. Net becomes gross pretty quickly when just one counter-party topples. I'm not saying we'll be seeing Armageddon, but brushing the risks of these derivatives under the carpet is no better than the belief that CDOs spread risk.
    10 Mar 2012, 08:17 AM Reply Like
  • Snakeeyes
    , contributor
    Comments (45) | Send Message
    Greek 6 mos CDS at 84,199%. OPA!

    10 Mar 2012, 01:08 PM Reply Like
  • Boxed Merlot
    , contributor
    Comments (1600) | Send Message
    No different than Tepco announcing the meltdown resulted in the release of radioactivity into the environment.


    The degree of damage will always be understated and those closest will suffer irrepairable harm but the invisible damage of the faulty premise of the deconstruct will have society at large exposed to and suffering the fallout of this event for years if not decades to come.


    Tenoe's Lois Freeh is attempting the same act in claiming those closest to Corzine's MFG meltdown were heroic in their efforts at the time of the meltdown of that institution and should recieve an additional bonus from the judge handling the bankruptcy. (Even though he's able to reconstruct the events to their benefit but all other leads in this case have been exhausted.)


    The toxic fallout of having depositors trust flagrently violated by company administrators vaporizing their accounts will have a devestating effect on the integrity of the free worlds economies unless and until the moral defects in character of these people are addressed in a serious way.


    Don't count on it. The melt down will continue unabated. imo.
    11 Mar 2012, 06:53 PM Reply Like
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