DAMNIT!!!!!
02/20/2012
Ann Barnhardt doesn’t have that “click to link” ability on her blog. Go to her site and find this article.
So Bad I Can’t Think of a Suitable Title
Posted by Ann Barnhardt – February 19, AD 2012 9:12 PM MST
This is some scary shit I tell you!
Blame the “passing out before I could get horizontal” on this post.
You may remember a couple weeks back there was talk of making the Greek bondholders go greek andtake a 70% loss on the the investment. Much gnashing of teeth ensued as this would in many cases should kick into effect what are called “credit default swaps”. Simply put CDS are hedges that work as insurance against the debtor defaulting. You will never guess who holds a large share, amounting to trillions of dollars, of these contracts actually of course you will JP Morgan, Goldman Sachs, and Citigroup.
Now from what I understand of this, written into the contract the default must be certified by a group called the ISDA(International Swaps and Derivative Association) which is a Fed like organization for these derivatives. You will never guess who sits on the board this supra national organization. People associated with Morgan, GS, Citi, Paribas and all the big international banks. Here’s an article by our heroine Anne Barnhardt describing the whole scenario.
They do no not want to pay on these because even the relatively modest default(what’s on deck in Portugal, Italy and Spain are perhaps an order of magnitude larger) based on 70% of Greek debt is a solvency issue for these banks. What this organization had intended to do was call the haircut imposed on investors “voluntary” and therefore not technically “default”. Yeah if you’re a bank holding that worthless shit and your examiner comes in and tells you to write that investment down 70% the technical evasion isn’t gonna save you. Now YOU as the holder potentially have a solvency issue. Now no sophisticated investor was gonna touch Greek debt without some assurances. Now we see that that was a rigged game.
This lead us to the ECB’s lawless maneuver of essentially making a deal with Greek(does the Trojan Horse episode ring a bell) that makes the ECB position superior to all the other bond holders. It is especially worrisome because apparently the Greek default has already been scheduled.. Like Anne says someone is going to be left holding the bag on this but apparently it will be neither the Greeks or the ECB. The logical next question is who?
At this moment it is either those who issued the CDS contracts or those who were so doubly stupid as to buy Greek sovereign debt and then sign an insurance agreement with counter-parties who are in control of the sole arbiters of whether the payoff event will take place. But my guess it will be neither as since most of these parties are banks they will probably be deemed under the laborious and unscrupulous Dodd-Frank fiasco to be “systemic risks” and bailed out. This is especially true for the NDSWP slush fund known as Goldman-Sachs.
Someone is going to take the loss and I’m afraid the American taxpayer is again being maneuvered to take the fall.
An interesting piece of audio it is pertinent up until about 25 minutes in:
Now a word of caution Sinclair is what is derisively known as a “goldbug” so please take his words under that proviso.
It is not our fault they fucked up, we shouldn’t be responsible for fixing it. Now, if we buy them out in the fire sale, we should be using the new property we now own to invest and reap from.
She does not have the click to link, b/c she writes her articles and many bloggers dont have blog-etiquette.
They dont KNOW they dont have it, but they dont.
She is one smart cookie.
True. What I like so much about her blog is the “This is what I think, don’t like it don’t read me” attitude.