derivatives

The lawsuits are piling up. America is a very litigious country and when things go wrong people sue. That's one reason one should realistically expect the courts to be clogged with all manner of suits on bond insurance, auction rate…

When you start monkeying around with markets, strange things happen. This is what the SEC is about to learn as market makers from the seven options exchanges are preparing to ask for exemptions from the new anti-free market SEC…

As you would expect, the market sees the U.S. Government as much less creditworthy. Note the rise in credit default swaps on U.S. Treasuries. The question is: when will its foreign government supporters abandon a sinking ship. This is…

Remember the money center banks' ludicrous attempt to pretty up those off-balance sheet vehicles via the 'Super SIV?' Well, that was a clear bust. But, the toxic waste in those vehicles is still there. Some of these vehicles have been…

Back in June, I wrote about financial investors in bank shares having lost $10 billion. Then, I predicted that losses would mount and bank shares will fall. It seems that one part of that equation is true already as bank shares have…

As financial shares take a beating, it is a good opportunity to highlight the differential treatment of accounting for loans and for debentures and securities because this bodes ill for regional banks. FAS 157 The crux of the difference…

This from the National Post.The note from Blackmont analyst Brad Smith followed news late on Friday that Moody's Investors Service had downgraded XL Capital Assurance. CIBC has exposure to XL Capital since the bond insurer provides it with…

I have been following a story for a few months in the Canadian Press on Transat, a tour operator. I hadn't reported on it until now because they were just bailed out. It seems they have gotten tangled in the ABCP (Asset-Backed Commercial…

Barron's sees recovery in credit markets where others, most notably RBS, are bearish. Who's right? Let's hope Barron's. But, only time will tell.Barron's had this to say: eight important credit-market indicators and their current…

This via the FT blog FT Alphaville:The latest downgrades from S&P - testament to the fact that the structured finance unwind isn’t yet unwound: 330 U.S. CDOs put on credit watch negative80 second lien RMBS cut to ‘D’65 Alt-A RMBS…