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Template:M summ Credit Derivatives 3.13: Difference between revisions
Template:M summ Credit Derivatives 3.13 (view source)
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You get to specify one {{cddprov|Obligation Category}} and any number of {{cddprov|Obligation Characteristics}}. Fear not, though: the Obligation Categories are rather like nested Russian dolls: each smaller one fits in the one before. | You get to specify one {{cddprov|Obligation Category}} and any number of {{cddprov|Obligation Characteristics}}. Fear not, though: the Obligation Categories are rather like nested Russian dolls: each smaller one fits in the one before. | ||
==={{Cddprov|Obligation Categories=== | ==={{Cddprov|Obligation Categories}}=== | ||
So {{cddprov|Payment}} is about as wide as a payment obligation can be, and includes the Reference Entities day-to-day outgoings: rent, wages, utilities, even the paper bill, if you can find enough unpaid invoices to tot up to the {{cddprov|Default Requirement}}. | So {{cddprov|Payment}} is about as wide as a payment obligation can be, and includes the Reference Entities day-to-day outgoings: rent, wages, utilities, even the paper bill, if you can find enough unpaid invoices to tot up to the {{cddprov|Default Requirement}}. | ||
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Inside {{cddprov|Borrowed Money}} there are the two classic kinds of indebtedness: {{cddprov|Loan}}s — generally private, not easily<ref>Yes , yes, [[participation]]s, but if you have played with one of those you won’t think it easy way if transferring, at least not compared with just “handing a security to someone else”</ref> transferable, bilateral credit arrangements (or mildly multilateral — if there is a syndicate), and {{cddprov|Bonds}} — generally public, freely transferable, exchange-traded debt securities. Here you can choose one, the other, or both. | Inside {{cddprov|Borrowed Money}} there are the two classic kinds of indebtedness: {{cddprov|Loan}}s — generally private, not easily<ref>Yes , yes, [[participation]]s, but if you have played with one of those you won’t think it easy way if transferring, at least not compared with just “handing a security to someone else”</ref> transferable, bilateral credit arrangements (or mildly multilateral — if there is a syndicate), and {{cddprov|Bonds}} — generally public, freely transferable, exchange-traded debt securities. Here you can choose one, the other, or both. | ||
==={{Cddprov|Obligation Characteristics}}=== | |||
You can choose many of these, though some are mutually exclusive: {{cddprov|Not Subordinated}} versus {{cddprov|Subordinated}} being the obvious example. | |||
The JC’s view is that if you are going to engage with credit derivatives, make them {{cddprov|Not Subordinated}}. CDS is a troublesome enough asset class where it does work, superficially. It really doesn’t make sense for a capital note. | |||
==={{Cddprov|Prior Reference Obligation}}=== | |||
There is a cheeky nod here to the {{cddprov|Successor}} cluster bomb in the shape of the {{cddprov|Prior Reference Obligation}}. Just what mischief {{icds}} thought it was heading off is not clear — surely the answer is to make sure your {{cddprov|Standard Reference Obligation}} table is up to date , not writing heath Robinson machines prescribing what to do it it is not | |||
==={{Cddprov|Obligation Characteristics}}=== | ==={{Cddprov|Obligation Characteristics}}=== | ||