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Thread: Ireland's CDS Curve Inverts

  1. #1

    Default Ireland's CDS Curve Inverts

    This happened to Greece just before its Treasury Curve inverted which was subsequently just before it had to call in the IMF / EU back in May.

    Another corner turned.

    “The curious task of economics is to demonstrate to men how little they really know about what they imagine they can design.” - Friedrich A. Hayek

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    Moderator Cato's Avatar
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    Your user name is well chosen.
    “I would rather be exposed to the inconveniences attending too much liberty, than those attending too small a degree of it." - Thomas Jefferson (yeah, I'm aware of the irony)

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    Politics.ie Member seabhcan's Avatar
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    Quote Originally Posted by Cassandra Syndrome View Post
    This happened to Greece just before its Treasury Curve inverted which was subsequently just before it had to call in the IMF / EU back in May.

    Another corner turned.

    ? CDS is going down and this is a bad thing?

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    Politics.ie Member neiphin's Avatar
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    i dont know what that really means

    but iam vexed, so ans so"s on another tread rejoicing at the beating of students
    the sooner the cliff comes the better
    "If we VOTE YES there will be no more austere budgets. Fact " Hammer, mayday 12'

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    Quote Originally Posted by seabhcan View Post
    ? CDS is going down and this is a bad thing?
    Eh? They are all going UP, its just that the near end of the curve is soaring as is our treasury yield curve.

    Its a leading chart of lights out.
    “The curious task of economics is to demonstrate to men how little they really know about what they imagine they can design.” - Friedrich A. Hayek

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    Politics.ie Member seabhcan's Avatar
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    Quote Originally Posted by neiphin View Post
    i dont know what that really means

    but iam vexed, so ans so"s on another tread rejoicing at the beating of students
    the sooner the cliff comes the better
    CDS is insurance that someone can buy against the risk of Ireland defaulting. The price of CDS going down means (roughly) that the risk of Ireland defaulting is also thought to be going down.

    This is a good thing.

    EDIT: - sorry, I misread the chart. CDS prices are higher for for 2 and 3 year bonds rather than for 10 year bonds. I presume this means that traders think that these bonds are riskier than 10 year bonds - which (maybe) shows they are thinking about a default in the near future.

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    Politics.ie Member seabhcan's Avatar
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    Quote Originally Posted by Cassandra Syndrome View Post
    Eh? They are all going UP, its just that the near end of the curve is soaring as is our treasury yield curve.

    Its a leading chart of lights out.
    ah - my mistake. I misread the X-axis. I thought it was time.

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    Is this as big a moment as you are suggesting??

    Spain inverted back in the summer as have all the PIIGS before??

    FT Alphaville » Another CDS curve inverts — Spain

    Is this really meriting a thread or ....

  9. #9

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    Quote Originally Posted by neiphin View Post
    i dont know what that really means

    but iam vexed, so ans so"s on another tread rejoicing at the beating of students
    the sooner the cliff comes the better
    It means those who are rejoicing may need to think things through logically and ponder on things such as where does the money come from that pays the wages of the thugs that beat the protesters.
    “The curious task of economics is to demonstrate to men how little they really know about what they imagine they can design.” - Friedrich A. Hayek

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    Politics.ie Member neiphin's Avatar
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    Quote Originally Posted by seabhcan View Post
    CDS is insurance that someone can buy against the risk of Ireland defaulting. The price of CDS going down means (roughly) that the risk of Ireland defaulting is also thought to be going down.

    This is a good thing.
    so on your re-reading is it good or bad now ?
    "If we VOTE YES there will be no more austere budgets. Fact " Hammer, mayday 12'

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