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===On the genealogy of ISDAs=== | ===On the genealogy of ISDAs=== | ||
The {{isdama}} (we are talking about the {{1987ma}} and even the {{1985ma}}) was spun from the tiny fingers of those primordial [[Children of the | The {{isdama}} (we are talking about the {{1987ma}} and even the {{1985ma}}) was spun from the tiny fingers of those primordial [[Children of the Woods]] — the ''[[loan]]s'' wood, that is: early swaps were seen as off-setting loan contracts between counterparties — where {{isdaprov|Transaction}}s were expected to be bespoke, of long [[tenor]], unmargined ([[variation margin]] only really because common with the {{1994csa}} and {{1995csa}}), periods of months without payments. | ||
Thus, one’s ability to [[accelerate]] by reference to independent [[credit event]]s hasppening to one’s counterparty in the market (like {{isdaprov|Cross Default}}) or relating to other trading contracts between one and one’s counterparty (like {{isdaprov|DUST}}) was regarded as important. But like a lot of other things, times have changed since the late eighties. The nature of [[swap]] trading has matured, as volumes have ''exploded'', the vibe has markedly shifted towards daily [[margin]], many payments going back and forth each day, very little risk of going for months between coupon payments but riding massive [[MTM]] exposures, and with nothing to hang a {{isdaprov|Failure to Pay}} on. If swaps ever did present before Doctor Risk as dolled up loan exposures, they don’t now. Yet, {{isdaprov|Cross Default}} and {{isdaprov|DUST}} remain baked into the {{isdama}}’s exoskeleton rather like a coccyx or tonsils: a residual [[evolution]]ary vestige of a prior ecosystem now largely vanished. | Thus, one’s ability to [[accelerate]] by reference to independent [[credit event]]s hasppening to one’s counterparty in the market (like {{isdaprov|Cross Default}}) or relating to other trading contracts between one and one’s counterparty (like {{isdaprov|DUST}}) was regarded as important. But like a lot of other things, times have changed since the late eighties. The nature of [[swap]] trading has matured, as volumes have ''exploded'', the vibe has markedly shifted towards daily [[margin]], many payments going back and forth each day, very little risk of going for months between coupon payments but riding massive [[MTM]] exposures, and with nothing to hang a {{isdaprov|Failure to Pay}} on. If swaps ever did present before Doctor Risk as dolled up loan exposures, they don’t now. Yet, {{isdaprov|Cross Default}} and {{isdaprov|DUST}} remain baked into the {{isdama}}’s exoskeleton rather like a coccyx or tonsils: a residual [[evolution]]ary vestige of a prior ecosystem now largely vanished. | ||