Home › Forums › Financial Markets/Economics › Banks Bet Against U.S. Cities, States
- This topic has 10 replies, 3 voices, and was last updated 14 years, 9 months ago by
CA renter.
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April 27, 2010 at 7:52 PM #17386April 27, 2010 at 9:31 PM #544344
gandalf
ParticipantYes, I heard about this too. Tremendous cause for concern. Fiscal health of the State of CA greatly affects the overall state and US economy. We’re not out of the woods yet.
Looking back, it’s really surprising the government wasn’t able to extract substantial reforms in exchange for the bailout. Comment on our political system, I suppose.
April 27, 2010 at 9:31 PM #544460gandalf
ParticipantYes, I heard about this too. Tremendous cause for concern. Fiscal health of the State of CA greatly affects the overall state and US economy. We’re not out of the woods yet.
Looking back, it’s really surprising the government wasn’t able to extract substantial reforms in exchange for the bailout. Comment on our political system, I suppose.
April 27, 2010 at 9:31 PM #544936gandalf
ParticipantYes, I heard about this too. Tremendous cause for concern. Fiscal health of the State of CA greatly affects the overall state and US economy. We’re not out of the woods yet.
Looking back, it’s really surprising the government wasn’t able to extract substantial reforms in exchange for the bailout. Comment on our political system, I suppose.
April 27, 2010 at 9:31 PM #545033gandalf
ParticipantYes, I heard about this too. Tremendous cause for concern. Fiscal health of the State of CA greatly affects the overall state and US economy. We’re not out of the woods yet.
Looking back, it’s really surprising the government wasn’t able to extract substantial reforms in exchange for the bailout. Comment on our political system, I suppose.
April 27, 2010 at 9:31 PM #545305gandalf
ParticipantYes, I heard about this too. Tremendous cause for concern. Fiscal health of the State of CA greatly affects the overall state and US economy. We’re not out of the woods yet.
Looking back, it’s really surprising the government wasn’t able to extract substantial reforms in exchange for the bailout. Comment on our political system, I suppose.
April 28, 2010 at 12:44 AM #544384CA renter
ParticipantIMHO, this could also keep borrowing costs **down** if the debt investors use these CDSs as a hedge against default.
It’s much like the mortgage market in the later part of the bubble. The CDS market took off (signaling potentially higher risk) while mortgage rates remained relatively low. Essentially, you can hide the risk in the CDS market (which is more opaque!) that’s normally shown in the debt market via interest rates.
April 28, 2010 at 12:44 AM #544499CA renter
ParticipantIMHO, this could also keep borrowing costs **down** if the debt investors use these CDSs as a hedge against default.
It’s much like the mortgage market in the later part of the bubble. The CDS market took off (signaling potentially higher risk) while mortgage rates remained relatively low. Essentially, you can hide the risk in the CDS market (which is more opaque!) that’s normally shown in the debt market via interest rates.
April 28, 2010 at 12:44 AM #544976CA renter
ParticipantIMHO, this could also keep borrowing costs **down** if the debt investors use these CDSs as a hedge against default.
It’s much like the mortgage market in the later part of the bubble. The CDS market took off (signaling potentially higher risk) while mortgage rates remained relatively low. Essentially, you can hide the risk in the CDS market (which is more opaque!) that’s normally shown in the debt market via interest rates.
April 28, 2010 at 12:44 AM #545072CA renter
ParticipantIMHO, this could also keep borrowing costs **down** if the debt investors use these CDSs as a hedge against default.
It’s much like the mortgage market in the later part of the bubble. The CDS market took off (signaling potentially higher risk) while mortgage rates remained relatively low. Essentially, you can hide the risk in the CDS market (which is more opaque!) that’s normally shown in the debt market via interest rates.
April 28, 2010 at 12:44 AM #545345CA renter
ParticipantIMHO, this could also keep borrowing costs **down** if the debt investors use these CDSs as a hedge against default.
It’s much like the mortgage market in the later part of the bubble. The CDS market took off (signaling potentially higher risk) while mortgage rates remained relatively low. Essentially, you can hide the risk in the CDS market (which is more opaque!) that’s normally shown in the debt market via interest rates.
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