China furious At the Germans!

[Mega]

http://www.independent.co.uk/news/bu...e-1207511.html

Not sure what this means?
Fred?
EJ?
Luke?
Metalman?

Mike

[Ted Q. Sipp]

Re: China furious At the Germans!

This is what happens when you dabble in optionality. Yield-to-call assumes the issuer has an incentive to call the bonds in, usually refinancing. That's all well and good when yield curves are relatively stable. Sure, your benchmark index might at a historic low but risk spreads have blown way the hell out....if you can find a lender, that is.

Hurry! Hoard the cash, call the lawyers and dig up the indentures:

http://uk.reuters.com/article/market...44697720081222

[GRG55]

Re: China furious At the Germans!

http://www.independent.co.uk/news/bu...e-1207511.html

Not sure what this means?
Fred?
EJ?
Luke?
Metalman?

Mike

What it means is bond purchasers need to learn to read the fine print as what they have is a contractrual arrangement in law.

I'm not sure it's for the same reasons as $#*, but I must say that I find recent Chinese behaviour hilarious. They seem to be working their way around the circuit, threatening everyone and anyone that they will withdraw their capital support. US Government, international banks... What are they going to do, stuff their surplus US$ and Euros into fortune cookies. Puleeeese...