Fight Debt with Debt

rffrydr · Posted: Wed Mar 25, 2009 9:29 am Post subject: Fight Debt with Debt

Hertz now in buyback mode. Again, the hurdle is a legal one:

rffrydr · Posted: Mon Dec 05, 2011 10:38 am Post subject:

Commerzbank down close to 10% on Der Spiegel article and wind-up plan is being put in place. Like Dexia I view this as a positive--anything decisive helps at this point. But there is much to still to be taken advantage of:

rffrydr · Posted: Tue Nov 22, 2011 6:23 pm Post subject:

....and the vicous cycle continues even there in the gaol:

http://www.latimes.com/news/local/la-me-inmate-fees-20111120,0,5578514.story

""In these very challenging economic times, every dollar counts for counties, especially when you're $80 million in the hole," Stone said. "If you do the crime, then you're going to do the time and you're going to pay the dime."

The bigger picture that we cannot hold what we got makes the re-emergence of debtors prison remote at best.
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HenryTo · Posted: Tue Nov 22, 2011 12:06 pm Post subject:

Fighting debt with... prison. Debtors' prison back in vogue.

http://www.businessinsider.com/the-return-of-debtors-prisons-collection-agencies-now-want-deadbeats-arrested-and-sent-to-the-big-house-2011-11

rffrydr · Posted: Mon Oct 10, 2011 8:07 pm Post subject:

Looks like you're right, no saving Greece. But can kicking is still pitching in:

http://boards.fool.co.uk/ermmm-so-the-irish-state-borrow-eur-1bn-at-3-from-12382121.aspx?sort=postdate
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Ven · Senior Poster Joined: 30 Dec 2009 Posts: 115

I'll just politely disagree with you and say that there is no saving Greece, they are insolvent.
"Kick the can" only works if you still have more road to work with -- in other words, another balance sheet.

That's what happened in '08, the U.S. banks just passed their losses onto the U.S. taxpayers.
Privatize the profits. Socialize the losses.

Greek banks cannot pass their losses on, unless Germany wants to pay for the whole of Europe.
In that case, the bond vigilantes will eventually turn on them, too.

rffrydr · Posted: Thu Aug 04, 2011 4:43 pm Post subject:

A bond is just a piece of paper you trust....and when the word behind that paper, it's "credere," gets sloppy..... But issuing debt at 3% to buy and retire Greek debt at 0.55 cents IS debt destruction. And it's a market function. This route may just save Greece in the long run.
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Ven · Senior Poster Joined: 30 Dec 2009 Posts: 115

I hope Europe is now teaching some that, you cannot "fight debt with more debt".
http://www.cnbc.com/id/44020009

rffrydr · Posted: Mon Jul 11, 2011 8:22 am Post subject:

There we go:

http://www.cnbc.com/id/43707609

rffrydr · Posted: Thu Jun 16, 2011 3:05 pm Post subject:

This is the one advantage here in the greek tragedy and all-too obvious from my perspective. Private "participation" is right there in the price. It's been used but swamped by the economy. But don't dismiss the "can-kicking" out of hand--or ideology!

http://ftalphaville.ft.com/blog/2011/06/16/596331/its-a-fab-time-for-a-greek-buyback-says-goldman/
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rffrydr · Posted: Sun May 29, 2011 10:57 am Post subject:

Having dodged the bullet on one of these things with Delta Airlines I'm starting to really like the prospects of reverse convertibles in general:

http://www.risk.net/digital_assets/1095/27_April_10.pdf

Some who completely missed the rally (esp HiYield) and is weakly bullish will want to give these a serious look. I'll probably pick up a few in Delta next week.

[edit] I'm assuming these are available on the secondary but now see they probably aren't......in which case there is a clear bias on the premium.

http://seekingalpha.com/article/108107-reverse-convertibles-in-favor-of-the-issuer-not-the-buyer

In which case you just own the debt and sell puts on the equity--which is probably not efficient for small investors. (I've been sorta doing this with the GM preferreds since Nov. )
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rffrydr · Posted: Thu Apr 28, 2011 4:04 pm Post subject:

Greeks taking down debt $2.5 billion at a swat. How? With the money they don't have to pay this debt already in accounts. Not your father's credit card here. N.I.O. Wink

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rffrydr · Posted: Wed Apr 06, 2011 8:47 pm Post subject:

Growth pro-rated sovereign debt. Not a bad idea even if it comes from Ireland. Breaks that infernal pro-cyclicality of market collapses.

http://ftalphaville.ft.com/blog/2011/04/06/538126/irish-gnp-warrants-ftw/
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rffrydr · Posted: Mon Feb 07, 2011 2:15 pm Post subject:

One of the perversities of debt spreads while coming out of depressions is that in zero-rate environments previous top-of-the-cycle spreads are suddenly much bigger than they seem. Nothing is obvious:

rffrydr · Posted: Sat Jan 15, 2011 10:14 pm Post subject:

By hook or by crook it's happening:

rffrydr · Posted: Sun Dec 05, 2010 9:27 am Post subject:

This will work:

http://ftalphaville.ft.com/blog/2010/12/03/417746/eurobonds-are-among-us/

We have not only learned these past three years that there are no riskless assets and these "forced consensuses" should surprise no-one. That sacrosanct sovereigns should be included in this age of disintegrating nations (if not nationalism--the "idea" of europe in a nutshell) should surprise no-one. That it comes with the boomers so thoroughly loaded up on bonds just goes to show.....
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