Normal
Refined Silver just on the Dervis sums (yeah again). Just bear() with me. I know you know what you are talking about but that figure may need some teasing out.1. Where did it come from. I suspect is adding the total exposure from balance sheets, bank reporting authority etc?? The problem with that is that would make it 1/2 the amount. Like this... Bank A reports $100 worth of derivatives on its balance sheet and Bank B reports $100 worth of derivatives on its balance sheet. that makes $100 worth of derivatives as there is two parties to every 1 transaction. I bet that is a total sum and therefore probably half the amount.2. If one side defaults, without including the flow on and implosion after that, the ACTUAL value lost would be ONLY the margin put up. Not the nominal value of the derivative. So whats at risk is probably 5% or less of that figure. A simple example to explain what I am getting at. There is about 300,000 SPI contracts open at the moment. The value of them is 300,000 X $125,000 = $37,500,000,000 (37 trill ??)Lets say all the longs default the amount actually lost would "only" be 3.6, Trill that is the margin put up by the other party.Yes either way its still a Sh*t storm in the making but suspect we can knock a few 00 off
Refined Silver just on the Dervis sums (yeah again). Just bear() with me. I know you know what you are talking about but that figure may need some teasing out.
1. Where did it come from. I suspect is adding the total exposure from balance sheets, bank reporting authority etc?? The problem with that is that would make it 1/2 the amount. Like this... Bank A reports $100 worth of derivatives on its balance sheet and Bank B reports $100 worth of derivatives on its balance sheet. that makes $100 worth of derivatives as there is two parties to every 1 transaction. I bet that is a total sum and therefore probably half the amount.
2. If one side defaults, without including the flow on and implosion after that, the ACTUAL value lost would be ONLY the margin put up. Not the nominal value of the derivative. So whats at risk is probably 5% or less of that figure. A simple example to explain what I am getting at. There is about 300,000 SPI contracts open at the moment. The value of them is 300,000 X $125,000 = $37,500,000,000 (37 trill ??)
Lets say all the longs default the amount actually lost would "only" be 3.6, Trill that is the margin put up by the other party.
Yes either way its still a Sh*t storm in the making but suspect we can knock a few 00 off
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