Posts Tagged ‘swaps’

Two years later, the Dodd-Frank train has left the station.

With the passing of the Swap Definition rule on Tuesday, July 10th the clock really starts ticking as some key rules are going into effect this fall.  Any rational person would assume that before you write rules governing Swaps, you start with the simple task of defining the Swap.  Unfortunately life in the derivative world…

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Clearing the Way for Clearing: Cost vs. Benefits to End-Users

ISDA put out a great summary of some of the key issues on the future of clearing OTC derivatives versus the current benefits of bilateral collateral arrangements that exist today (http://isda.derivativiews.org/2012/04/24/the-bilateral-world-vs-the-cleared-world/), highlighting additional margin, capital charges, documentation and players. There has been much discussion already about the initial margin hit that end-users will take and…

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Will CDS Survive the European Debt Crisis?

Governments and large issuers hate them, regulators wrestle with them and the general public do not have a clue of what they are, but Credit Default Swaps are the cleanest way to hedge credit risk. They also promote liquidity (ok, and sometimes volatility) into the bond markets as bond holders can buy CDS protection instead of selling bonds in the open market. But as Greece and other issuers start to test the waters with voluntary bond swaps, where large investors take a significant haircut on the principle value of the bonds in order to stem a default, CDS holders are crying foul.

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Reval Comments to CFTC on Margin Rules

Comments to the CFTC on Margin Requirements for Uncleared Swaps for Swap Dealers and Major Swap Participants closed on Monday. Reval’s comment letter outlines potential impacts to end-users.

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