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{{a|isda|[[File:William Blake - The Day of Judgment.jpg|450px|thumb|center|Uh-oh: honey — did I check the residual {{isdaprov|Cross Default}} risk on that old [[87 ISDA]]?]]}}The status of every defunct [[ISDA]] master agreement, once all {{isdaprov|transaction}}s have [[Terminated Transaction - ISDA Provision|terminated]], whether through the exigencies of a stressed [[close-out]], or simply through the [[entropy]] and general lassitude of a modern life in which many erstwhile [[ISDA]] devotees grew bored, or adversely regulated, and gave up on [[swap]]s, letting the last remaining {{isdaprov|transaction}}s to roll off and scamper, free, into the fragrant meadows of oblivion. | {{a|isda|[[File:William Blake - The Day of Judgment.jpg|450px|thumb|center|Uh-oh: honey — did I check the residual {{isdaprov|Cross Default}} risk on that old [[87 ISDA]]?]]}}The status of every defunct [[ISDA]] master agreement, once all {{isdaprov|transaction}}s have [[Terminated Transaction - ISDA Provision|terminated]], whether through the exigencies of a stressed [[close-out]], or simply through the [[entropy]] and general lassitude of a modern life in which many erstwhile [[ISDA]] devotees grew bored, or adversely regulated, and gave up on [[swap]]s, letting the last remaining {{isdaprov|transaction}}s to roll off and scamper, free, into the fragrant meadows of oblivion. | ||
For while you can terminate a ''{{isdaprov|Transaction}}'' under an {{isdama}} — and ''all of them at once'', if things really come to that — none of its printed forms envisages the parties terminating the [[master agreement]] ''itself''.<ref>There are reasons for this, but they are [[tedious]]: If you terminate the whole agreement, not just the {{isdaprov|Transaction}}s under it, then how are all those clever [[close out]] mechanics meant to work?</ref> It has no general [[no-fault termination]] provisions so, unless you and your counterparty can confect one — for that you will need communion wine, garlic, wooden stakes and so on — a discarded ISDA arrangement will just ''lie there'', locked-in, mute, transfixed, plastered to the infinite like some ghostly apparition, frozen at the [[event horizon]] of financial probity for ever — surviving, indefinitely, some say even beyond the mortal existence of they whose trading relationship it once described. | For while you can terminate a ''{{isdaprov|Transaction}}'' under an {{isdama}} — and ''all of them at once'', if things really come to that — none of its printed forms envisages the parties terminating the [[master agreement]] ''itself''.<ref>There are reasons for this, but they are [[tedious]]: If you terminate the whole agreement, not just the {{isdaprov|Transaction}}s under it, then how are all those clever [[close out]] mechanics meant to work?</ref> It has no general [[no-fault termination]] provisions so, unless you and your counterparty can confect one — for that you will need communion wine, garlic, wooden stakes and so on — a discarded ISDA arrangement will just ''lie there'', locked-in, mute, transfixed, plastered to the infinite like some ghostly apparition, frozen at the [[event horizon]] of financial probity for ever — surviving, indefinitely, some say even beyond the mortal existence of they whose trading relationship it once described. | ||
This unnerves those of delicate or superstitious mien. For if it is still there, however immobile, can it not cause [[Financial weapons of mass destruction|mass destruction]] through inattention? | |||
You may laugh, but note only this: they who so haughtily wave such trifles away yet still go quiet and dare not speak of the [[Dark Lord]]. | Some would say this is a non-point, as un-alive as the ISDA that presents it. For an [[ISDA]], under which there are no extant {{isdaprov|Transaction}}s, carries no financial obligations. It presents no [[risk]]. It is as safe as a rusty Luger with the firing pin removed. | ||
If no {{isdaprov|Transactions}} remain that one can [[close out]], what earthly concern is it, for either party, if notional non-payment obligations go unfulfilled? What kind of paranoid weirdo would take the point that one’s continuing [[covenant]]s — to [[Documents for Delivery - ISDA Provision|send annual reports within three months of their publication]], for good example — are being broken?<ref>Only a person yet to meet an [[internal audit]]or could ask that question.</ref> And what of those financial ''meta''-obligations? That two-edged {{isdaprov|Cross Default}} clause? ''Could it'' ... ? | |||
You may laugh, but note only this: they who so haughtily wave such trifles away yet still go quiet and dare not speak of the [[Dark Lord of the Swaps]]. | |||
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