Credit Default Swaps
topic on 4 shows · 10 statements across 6 episodes
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10 statements about Credit Default Swaps, every show
Chamath Palihapitiya: Private sector credit default swap costs are near highs
“Through the course of this year, we've seen the cost of that insurance ramp, but at the beginning of liberation day, there was some relief there because people saw a path out of this and unfortunately we're back to almost near highs.”
Chamath predicts long Credit Default Swaps will be 2025's best asset
“But I would be long CDS. So what am I buying? I am buying insurance. I'm buying insurance. Using credit default swaps, I'm buying what's called protection, that there is no default event in 2025. Again, I'm not going to tell you which companies or what maturit…”
Robinson was a CDS trader at Lehman Brothers before its collapse
“And before that, I was a credit default swap trader at Lehman Brothers. And for those who are old enough to have been alive during the financial crisis, it's the bank that defaulted because of what we were trading.”
Ackman: Pershing Square held $71B notional CDS hedge committing $500M annually
“And we at the peak had seventy billion, actually seventy-one billion of notional insurance that cost about an average of 70 basis points per annum. So about five hundred million dollars. We committed to make five hundred million dollars a year in payments for …”
Bill Ackman Turned $27 Million in CDS Premiums Into $2.6 Billion
“We ended up spending twenty seven million on premium because we built a seventy billion dollar CDS position beginning in the third week of February, you probably had it completely on by the early, you know, first few days of March, and we started taking it off…”
Levine: Manufactured CDS defaults benefit corporations via cheaper debt refinancing
“I'm not that bothered by this for a couple of reasons. One, it's like Many of these stories result in companies getting cheap financing and it's like, well, you have this derivatives market. Company didn't ask for it. It was just like grew up independently of …”
Levine: Corporate defaults depend on creditor relationships, not pure cash flows
“It's a mistake to think that there is this pure bet on the credit quality of a company. The company is going to default or not default, not just based on its cash flows, but based on like whether it can get refinancing or whether its lenders will extend its lo…”
Chalkstream shorts overleveraged, declining Japanese companies via credit default swaps
“We have CDS positions in Japan. That's a whole nother bet where we think there's these massively levered companies that are trading at ridiculously tight CDS levels that we think are in industries that are in secular decline.”
Investors should buy CDS when highly levered entities hit 17 basis points
“Lehman traded at 17 basis points. And just as an overarching theme, anytime a highly levered thing trades anywhere in that zip code, I think he just, I think he puts them on.”