8 5/8
it is pretty low…isnt it!?
strangedays Wrote: ------------------------------------------------------- > it is pretty low…isnt it!? i’d say so. but again it’s a financial and it’s settling in the worst credit environment ever seen… maybe this terrible news will set a bottom. all insurance companies selling equities/bonds/assets to raise to pay up on Lehman settlement.
I think this will increase fear in the market
wild guess but i’d think a GM would probably settle at 20-25 in this enviroment
hmmm I think GM has to pay investor to settle their CDS
so which hedge funds are having to sell their kidneys to pay up for this?
somebody please help here: i don´t understand why everybody talks about how much they (protection sellers) will have to pay… aren´t they hedged? I don´t get this (perhaps because I have no idea about CDS) but I can not believe they did not hedge this somehow so that this is like an equity-put settlement
hala_madrid Wrote: ------------------------------------------------------- > somebody please help here: i don´t understand why > everybody talks about how much they (protection > sellers) will have to pay… aren´t they hedged? I > don´t get this (perhaps because I have no idea > about CDS) but I can not believe they did not > hedge this somehow so that this is like an > equity-put settlement protection seller dealers were probably damn close to 100% hedged. but HF’s/insurance companies/pension/etc have sold CDS rather then buying LEH bonds. that’s an outright position
MFE Wrote: ------------------------------------------------------- > hala_madrid Wrote: > -------------------------------------------------- > ----- > > somebody please help here: i don´t understand > why > > everybody talks about how much they (protection > > sellers) will have to pay… aren´t they hedged? > I > > don´t get this (perhaps because I have no idea > > about CDS) but I can not believe they did not > > hedge this somehow so that this is like an > > equity-put settlement > > > protection seller dealers were probably damn close > to 100% hedged. but HF’s/insurance > companies/pension/etc have sold CDS rather then > buying LEH bonds. that’s an outright position this would imply that there would not be “serious” effects for the big investment banks because of this settlement, right? (only for “buy-side” people like the ones you mention) thx for your comments MFE
protection seller dealers were probably damn close to 100% hedged. but HF’s/insurance companies/pension/etc have sold CDS rather then buying LEH bonds. that’s an outright position – that was outright stupidity…
hala_madrid Wrote: ------------------------------------------------------- > MFE Wrote: > -------------------------------------------------- > ----- > > hala_madrid Wrote: > > > -------------------------------------------------- > > > ----- > > > somebody please help here: i don´t understand > > why > > > everybody talks about how much they > (protection > > > sellers) will have to pay… aren´t they > hedged? > > I > > > don´t get this (perhaps because I have no > idea > > > about CDS) but I can not believe they did not > > > hedge this somehow so that this is like an > > > equity-put settlement > > > > > > protection seller dealers were probably damn > close > > to 100% hedged. but HF’s/insurance > > companies/pension/etc have sold CDS rather then > > buying LEH bonds. that’s an outright position > > > this would imply that there would not be “serious” > effects for the big investment banks because of > this settlement, right? (only for “buy-side” > people like the ones you mention) > > thx for your comments MFE yes and no. they may not be impacted directly by the settlement. however, they do have MAJOR counterparty risk as they may have hedged with other buyside firms that may be folding. nobody knows their real exposures, thus their risk maangement is saying SELL EVERYTHING. Margin at many buyside firms is being restricted, causing more selling, this selling is not about valuation, but about liquidity, however this will impact the economy as everyone recovers, but this will take time. the market will sell off more then needed, then probably snap back, then it’s going to be a wait and see if we skim by with a major recession or are we going to a great depression II. either way, us finance people are f’d
virginCFAhooker Wrote: ------------------------------------------------------- > protection seller dealers were probably damn close > to 100% hedged. but HF’s/insurance > companies/pension/etc have sold CDS rather then > buying LEH bonds. that’s an outright position > – > > > that was outright stupidity… It’s the same position as buying LEH bonds without actually buying them (Synthetic CDO Vs Cash CDO). Like bond buyers, they had no way of knowing LEH would go out of business.