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Cross default: Difference between revisions
→{{isdaprov|Cross default}} in the {{isdama}}
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==={{isdaprov|Cross default}} in the {{isdama}}=== | ==={{isdaprov|Cross default}} in the {{isdama}}=== | ||
In their infinite wisdom (or jest), the framers of the [[1987 ISDA Interest Rate and Currency Exchange Agreement]] ([[cro-magnon man]] to the {{2002ma}}’s metropolitan hipster) thought it wise to include a cross default, perhaps because, in those | In their infinite wisdom (or jest), the framers of the [[1987 ISDA Interest Rate and Currency Exchange Agreement]] ([[cro-magnon man]] to the {{2002ma}}’s [[metropolitan hipster]]) thought it wise to include a [[cross default]], perhaps because, in those pioneering days, [[Credit Support Annex|credit support annexes]] weren’t run-of-the-mill, and may not even have been invented. | ||
Subsequent generations of | Subsequent generations of [[Mediocre lawyer|derivative lawyers]], being the creatures of habit they are, especially when sequestered into an [[ISDA working group]], never thought to take it out, and even our artisanal coffee-swilling {{2002ma}} boasts a tedious {{isdaprov|Cross Default}} provision, an embarrassing relic of its bogan parentage. It’s like that tattoo you got when you were a drunk, but physically attractive, 19 year-old. | ||
You see the thing is, for a derivative [[master agreement]], [[cross default]] is a complete nonsense. | You see the thing is, for a derivative [[master agreement]], [[cross default]] is a complete nonsense. | ||
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Additionally, regulated [[credit institution]]s have (or should have) enormous concerns about giving away cross default, because it can affect their liquidity buffer calculations. | Additionally, regulated [[credit institution]]s have (or should have) enormous concerns about giving away cross default, because it can affect their liquidity buffer calculations. | ||
Yet still we persist in our sophistry. | |||
==Introduction== | ==Introduction== | ||