GREY:NEVDQ - Post by User
Post by
bogfiton Mar 15, 2022 9:38pm
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Post# 34517170
Meanwhile: In case you missed it. A Financial Pandemic.
Meanwhile: In case you missed it. A Financial Pandemic. On Monday, Russia’s Finance Ministry issued an order to pay the $117 million, although it didn’t specify the currency. Using rubles isn’t an option for this week’s coupons, based on the terms of those bonds. If Russia doesn’t meet its obligations, there’s technically a 30-day grace period that gives it until April 15 to make good. An official default declaration could also kick off claims on credit default swaps, insurance-like instruments designed to cover losses if a country or company fails to meet its debt obligations.”
That my friends is called “contagion”, as in a sickness spreading silently. CDS are unregulated and no one knows the full extent of obligations there under.
Example of losses:
“BlackRock funds exposed to Russia fell by more than 90% after the invasion, and clients now have less than $1 billion invested, down from about $18 billion at the end of January.”
And don’t let the talk of contagion discourage you, “While the debt is substantial, it’s probably not enough to cause a systemic problem for financial markets. That’s the view of International Monetary Fund Managing Director Kristalina Georgieva, who said last weekend that banks’ exposure is “not systemically relevant.”
https://finance.yahoo.com/news/russia-spiraling-toward-150-billion-040120029.html
With all the bad news out there, the real trouble might lie with a financial and liquidity crisis.
b.