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  • Counter-Party Risk [View article]
    Warren Buffett learned about CDSs when he bought out General Re. Finding $400M of them in the portfolio he ordered them unwound ASAP. Due to the cumbersome way they are traded it took him 4 years to track down all the counter parties and settle up in a non voltile market. It is my estimate that real panic will soon hit the market as people find out the insurance isn't worth the paper its written on and they try to salvage what they can of their gambles. Barry is right about counter party risk, if soured investments wound us, soured CDS will finish the job.
    Jan 20 19:14 pm |Rating: 0 0 |Link to Comment
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