The US invented the pizza delivery service. If you are too lazy to go out and collect a pizza, all you need to do is dial the pizza shop and a willing delivery man will satisfy your hunger quickly for a generous tip. The popular press has been focused on how the US can cut […]
https://www.firstdegree.asia/wp-content/uploads/2018/04/logo.png00Timhttps://www.firstdegree.asia/wp-content/uploads/2018/04/logo.pngTim2011-08-01 07:12:522018-05-21 07:13:20A Generous Tip for the Corn Delivery Man
The EU has given the EFSF power to both swap existing Greek bonds for new 30 year bonds as well as to buyback Greek bonds in the secondary market. These powers are complimentary and a smart debt manager may well be able to reduce the stock of Greek debt by more than expected under the […]
Clause 15 of the EU’s communique extending the terms of the Greek bailout provides a clue as to the real reason for the Summit. It reads “15. We agree that reliance on external credit ratings in the EU regulatory framework should be reduced…and we look forward to the Commission proposals on credit rating agencies.” Oh […]
https://www.firstdegree.asia/wp-content/uploads/2018/04/logo.png00Timhttps://www.firstdegree.asia/wp-content/uploads/2018/04/logo.pngTim2011-07-24 07:13:252018-05-21 07:13:51The Great Greek Summit: A Retrospective
Not since the Lehman default has there been such dislocation in the secondary markets for bonds. Last week, turnover in the GGB market ground to a halt and the recent price falls reflect an absence of liquidity. Total reported transactions on Thursday, for instance, were only EUR 6M versus something like EUR 300M on a […]
There is one thing that the European Finance Ministers meeting in Luxembourg know that the rest of the market does not: whether they will let Greece default. This is valuable information that they can and should take advantage of. My guess is that the debate taking place is all about how much a bailout will […]
https://www.firstdegree.asia/wp-content/uploads/2018/04/logo.png00Timhttps://www.firstdegree.asia/wp-content/uploads/2018/04/logo.pngTim2011-07-12 07:14:272018-05-21 07:14:51Europe’s Bond Crisis: Why a Secondary Market Buyback Makes Sense
Many years ago I worked on a project that brought me into contact with senior Government Ministers in Australia. I was treated respectfully but it was clear that I was a foreigner in the world of government and politics. A colleague of mine, whose husband was a MP, explained that politicians are in awe of […]
https://www.firstdegree.asia/wp-content/uploads/2018/04/logo.png00Timhttps://www.firstdegree.asia/wp-content/uploads/2018/04/logo.pngTim2011-07-07 07:14:532018-05-21 07:15:22Solving the European Debt Crisis: Start Thinking Like an Investor
Just as I was publishing yesterday’s post, Standard and Poor’s released a statement that foreshadowed a ‘selective default’ for any Greek Bonds that get rolled over under the French plan….But wait!!! The new bonds will attract S&P’s new, and higher, Greek credit rating. So investors suffer neither loss of capital nor coupon, they voluntarily subscribe […]
The credit rating agencies were clambouring over each other to downgrade Greece to ‘C’ during June, just one notch above default. Greece, they argued, was one-minute-from-midnight before going into default… But now that Greece has secured funding for the next two years, including a rollover commitment from their major private creditors, how likely does the […]
https://www.firstdegree.asia/wp-content/uploads/2018/04/logo.png00Timhttps://www.firstdegree.asia/wp-content/uploads/2018/04/logo.pngTim2011-07-03 07:16:002018-05-21 07:16:26One Minute to Midnight for the Ratings Agencies
Mario Draghi appears to have committed the ECB to a slew of open market purchases of European Sovereign debt. The argument is that if the ECB buys bonds, prices will rise thereby reducing the borrowing costs of the likes of Spain and Italy. The markets generally rejoiced at this prospect last week with global equity […]
https://www.firstdegree.asia/wp-content/uploads/2018/04/logo.png00Timhttps://www.firstdegree.asia/wp-content/uploads/2018/04/logo.pngTim2011-07-01 07:17:252018-05-21 07:17:53LDraghi Sets Out to Learn a Tough Lesson
A technocracy is a system of government where experts are in control of decision making. Greece and Italy have just signed up for this novel experience but what are they to expect. Look no further than Singapore … the tiny island-state has been ruled by experts since foundation in 1965 and now boasts one of […]
A Generous Tip for the Corn Delivery Man
The US invented the pizza delivery service. If you are too lazy to go out and collect a pizza, all you need to do is dial the pizza shop and a willing delivery man will satisfy your hunger quickly for a generous tip. The popular press has been focused on how the US can cut […]
An Effective Buyback and Bondswap Strategy
The EU has given the EFSF power to both swap existing Greek bonds for new 30 year bonds as well as to buyback Greek bonds in the secondary market. These powers are complimentary and a smart debt manager may well be able to reduce the stock of Greek debt by more than expected under the […]
The Great Greek Summit: A Retrospective
Clause 15 of the EU’s communique extending the terms of the Greek bailout provides a clue as to the real reason for the Summit. It reads “15. We agree that reliance on external credit ratings in the EU regulatory framework should be reduced…and we look forward to the Commission proposals on credit rating agencies.” Oh […]
The Greek Secondary Market Shuts Down: Arbitrage Opportunities Abound
Not since the Lehman default has there been such dislocation in the secondary markets for bonds. Last week, turnover in the GGB market ground to a halt and the recent price falls reflect an absence of liquidity. Total reported transactions on Thursday, for instance, were only EUR 6M versus something like EUR 300M on a […]
Europe’s Bond Crisis: Why a Secondary Market Buyback Makes Sense
There is one thing that the European Finance Ministers meeting in Luxembourg know that the rest of the market does not: whether they will let Greece default. This is valuable information that they can and should take advantage of. My guess is that the debate taking place is all about how much a bailout will […]
Solving the European Debt Crisis: Start Thinking Like an Investor
Many years ago I worked on a project that brought me into contact with senior Government Ministers in Australia. I was treated respectfully but it was clear that I was a foreigner in the world of government and politics. A colleague of mine, whose husband was a MP, explained that politicians are in awe of […]
Sour Grapes S&P Style
Just as I was publishing yesterday’s post, Standard and Poor’s released a statement that foreshadowed a ‘selective default’ for any Greek Bonds that get rolled over under the French plan….But wait!!! The new bonds will attract S&P’s new, and higher, Greek credit rating. So investors suffer neither loss of capital nor coupon, they voluntarily subscribe […]
One Minute to Midnight for the Ratings Agencies
The credit rating agencies were clambouring over each other to downgrade Greece to ‘C’ during June, just one notch above default. Greece, they argued, was one-minute-from-midnight before going into default… But now that Greece has secured funding for the next two years, including a rollover commitment from their major private creditors, how likely does the […]
LDraghi Sets Out to Learn a Tough Lesson
Mario Draghi appears to have committed the ECB to a slew of open market purchases of European Sovereign debt. The argument is that if the ECB buys bonds, prices will rise thereby reducing the borrowing costs of the likes of Spain and Italy. The markets generally rejoiced at this prospect last week with global equity […]
Technocrats Rule, OK?
A technocracy is a system of government where experts are in control of decision making. Greece and Italy have just signed up for this novel experience but what are they to expect. Look no further than Singapore … the tiny island-state has been ruled by experts since foundation in 1965 and now boasts one of […]