SatisfactoryFinance
SatisfactoryFinance t1_jdjxax5 wrote
Reply to comment by Mediocre_Sympathy_65 in Why does CDS surge is an indicator of a bank financial health ? by Mediocre_Sympathy_65
Well someone has to be on the short end of the CDS. Though they could insure/hedge those losses but it’s hard and $$$ I assume now.
In 2008 all the banks that had the short end of the CDS went and got it “insured” by the insurance companies. The amount of notional insured back then screwed the insurance companies, zapped liquidity, and the markets froze up.
So I think people are just afraid of that happening again, I don’t know enough about todays markets to know how true or false that is.
SatisfactoryFinance t1_jdjwcwj wrote
I don’t have a super well researched answer for you, but from general observations:
CDS were a huge issue in 2008 (that I know) and deutsche bank seems to have some fairly large exposure to them. If they have to payout on a bunch of CDS then that could be significantly problematic for them.
SatisfactoryFinance t1_jdjvwqq wrote
Reply to comment by Intellect_Invest in Can anyone provide an honest reason to be bullish right now? by [deleted]
Please take your facts and logic elsewhere.
Edit: username checks out
SatisfactoryFinance t1_jegrmyi wrote
Reply to comment by [deleted] in Is there a time where I can stop saving for retirement? by [deleted]
No kids means no one to fall back on for living or care if you get health issues as you get older, which means you may need more money.