Template:M summ 2002 ISDA 5(a)(vi): Difference between revisions

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 {{isdaprov|Cross Default}} is, therefore, theoretically at least, a very dangerous provision. [[Financial reporting]] dudes — some more than others, in the [[JC]]’s experience — get quite worked up about it. Yet, it is very rarely triggered:<ref>That is to say, it is practically useless.</ref> it is inherently nebulous. [[Credit officer]]s disdain nebulosity and, rightly, will always prefer to act on a clean {{isdaprov|Failure to Pay}} or {{isdaprov|Bankruptcy}}. Generally, if you have a daily-margined {{isdama}}, one of those will be along soon enough. And if it isn’t — well, what are you worrying about?
-“Okay, so why even ''is'' there a {{isdaprov|Cross Default}} in the {{isdama}}?” ''Great'' question. Go ask {{icds}}. The best [[JC|I]] can figure is  that, when the [[Children of the Forest]] first invented the [[eye-ess-dee-aye]] back in those primordial times, back in the 1980s, swaps were new, they hadn’t really thought them through, no-one realised how the market would explode<ref>Ahhh, sometimes ''literally''.</ref> and in any case, folks back then held lots of opinions we would now regard as quaint. I mean, just look at the music they listened to.
+“Okay, so why even ''is'' there a {{isdaprov|Cross Default}} in the {{isdama}}?” ''Great'' question. Go ask {{icds}}. The best [[JC|I]] can figure is  that, when the [[Children of the Forest]] first invented the [[eye-ess-dee-aye]] back in those primordial times, back in the 1980s, swaps were new, they hadn’t really thought them through, no-one realised how the market would explode<ref>Ahhh, sometimes ''literally''.</ref> and in any case, folks back then held lots of opinions we would now regard as quaint. I mean, just look at the music they — okay, ''we''<ref>I am indebted to my good friend Mr. V.C.S., who writes to point out that some of us ''still'' listen to that kind of music. All About Eve were misunderstood geniuses I tell you.</ref>  — listened to.
 ===={{isdaprov|Specified Indebtedness}}====
 {{isdaprov|Specified Indebtedness}} is generally any [[borrowed money|money borrowed]] from any third party (e.g. bank debt; [[deposits]], loan facilities etc.). Some parties will try to widen this: do your best to resist the temptation.