Today, the International Swaps and Derivatives Association starts a series of auctions to settle who pays what to whom on a plethora of credit derivative contracts relating to businesses that have gone into default. Lehmans bonds alone are estimated at $350bn... and someone - the underwriter - has to pay. An estimated $800bn of bonds fall due for settlement over the next three weeks, if they can't be settled, insurers have to cough up.
In the UK, the government owned National Savings Bank has been overwhelmed by depositors. Northern Rock, nationalised (and guaranteed) by the UK government last year has stopped taking deposits on many of its savings plans, it cannot cope with the demand. The Ulster Bank, covered by the Irish governments 2 year guarantee on savings is being inundated with deposits even from its parent bank, the Royal Bank of Scotland.
Money is flowing away from the banks who might need it to settle Swaps and Derivatives, and whilst retail bank deposits are small compared with Management Fund Deposits, once they MF's get a whiff of trouble, they'll be off.
I suggest you settle down with a crate of beer and watch the fun.
In the UK, the government owned National Savings Bank has been overwhelmed by depositors. Northern Rock, nationalised (and guaranteed) by the UK government last year has stopped taking deposits on many of its savings plans, it cannot cope with the demand. The Ulster Bank, covered by the Irish governments 2 year guarantee on savings is being inundated with deposits even from its parent bank, the Royal Bank of Scotland.
Money is flowing away from the banks who might need it to settle Swaps and Derivatives, and whilst retail bank deposits are small compared with Management Fund Deposits, once they MF's get a whiff of trouble, they'll be off.
I suggest you settle down with a crate of beer and watch the fun.
Last edited:
(just kitting)
