Friday, February 15, 2008
About this Blog
By: Anonymous
Posted: 14-2-2008
So as to bring you up to speed on what's happening in the real world ........ and its possible effect on us , ..the following that is happening may affect the financial health of the banking systems in the US (but like the proverbial frog in the well, all is still blue skies to you).
They are now talking of SOLVENCY, not just LIQUIDITY issue .......it's really quite serious now.
This is not meant to frighten but be a voice of caution ........ so as to mitigate potential losses!
SOLVENCY WORRIES STALK CREDIT-DERIVATIVES MARKET
Gross applied the historical average default rate of 1.25 percent to the $45.5 trillion of notional swaps and assumed a 50 percent recovery rate for holders of the defaulted debt. Under that all-too-plausible scenario, Gross calculated that the default-swap market has the potential to generate losses of $250 billion in coming years.
http://www.bloomberg.com/apps/news?pid=20601039&sid=adyEbUU8AE2M&refer=columnist_gilbert
Smart Buyers Collection: SOLVENCY WORRIES STALK CREDIT-DERIVATIVES MARKET
Smart Buyers Collection is a collection of words of wisdom by various Singapore property watchers.By: Anonymous
Posted: 14-2-2008
So as to bring you up to speed on what's happening in the real world ........ and its possible effect on us , ..the following that is happening may affect the financial health of the banking systems in the US (but like the proverbial frog in the well, all is still blue skies to you).
They are now talking of SOLVENCY, not just LIQUIDITY issue .......it's really quite serious now.
This is not meant to frighten but be a voice of caution ........ so as to mitigate potential losses!
SOLVENCY WORRIES STALK CREDIT-DERIVATIVES MARKET
Gross applied the historical average default rate of 1.25 percent to the $45.5 trillion of notional swaps and assumed a 50 percent recovery rate for holders of the defaulted debt. Under that all-too-plausible scenario, Gross calculated that the default-swap market has the potential to generate losses of $250 billion in coming years.
http://www.bloomberg.com/apps/news?pid=20601039&sid=adyEbUU8AE2M&refer=columnist_gilbert
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The blogger here has been affectionately named by close allies as "Smart Buyer" but really, he's not smart. Smart Buyer just believes that being prudent is smart. That's the essence of the message of this blog and Smart Buyer hopes it'll benefit other property buyers.
Smart Buyer :)