Tweet
http://www.bloomberg.com/apps/news?p...7U&refer=home#
"By employing a so-called negative-basis trade, investors could buy Six Flags bonds at 20.5 cents on the dollar and credit- default swaps at 71 cents. If the New York-based chain defaults, the creditors would receive the face value of the debt, minus costs. In a Feb. 27 note, Citigroup Inc.’s high-yield strategists put that profit at 6 percentage points, or $600,000 on a $10 million purchase."
Does this chaffe anyone else's ass? I mean these "investors" are essentially forcing business into bankruptcy so they can collect on the CDS from AIG (ie. the dumbass taxpayer).... Same goes for mortgages and home foreclosure... The musical chairs have stopped and the taxpayer is w/o a chair (or a home, a job or savings for that matter) and is wearing his big dunce hat....
If there were no CDS these creditors would work with the business in an attempt to turn the business around and make it a profitable venture... Meanwhile, employees and average folks/taxpayers are the pawns in this game...
Why does the taxpayer get screwed TWICE using his own money!! Once when he loses his job and afterwards in terms of higher taxes and inflation, so that some one who is in the business of risk can be made whole...
"By employing a so-called negative-basis trade, investors could buy Six Flags bonds at 20.5 cents on the dollar and credit- default swaps at 71 cents. If the New York-based chain defaults, the creditors would receive the face value of the debt, minus costs. In a Feb. 27 note, Citigroup Inc.’s high-yield strategists put that profit at 6 percentage points, or $600,000 on a $10 million purchase."
Does this chaffe anyone else's ass? I mean these "investors" are essentially forcing business into bankruptcy so they can collect on the CDS from AIG (ie. the dumbass taxpayer).... Same goes for mortgages and home foreclosure... The musical chairs have stopped and the taxpayer is w/o a chair (or a home, a job or savings for that matter) and is wearing his big dunce hat....
If there were no CDS these creditors would work with the business in an attempt to turn the business around and make it a profitable venture... Meanwhile, employees and average folks/taxpayers are the pawns in this game...
Why does the taxpayer get screwed TWICE using his own money!! Once when he loses his job and afterwards in terms of higher taxes and inflation, so that some one who is in the business of risk can be made whole...
Comment