tag:blogger.com,1999:blog-8764541874043694159.post6076852750301503185..comments2024-03-28T12:23:39.665+00:00Comments on Coppola Comment: Juncker's CDOFrances Coppolahttp://www.blogger.com/profile/09399390283774592713noreply@blogger.comBlogger7125tag:blogger.com,1999:blog-8764541874043694159.post-41450789003071416812014-12-08T16:51:50.166+00:002014-12-08T16:51:50.166+00:00Observant. When I wrote my comment above about sec...Observant. When I wrote my comment above about securitising EIB loans and selling them to the ECB, I wondered if the private sector would try to create an equivalent trade. I admit I hadn't appreciated the timing of the ECB's commencement of covered bond purchases, though. This is even more Machiavellian than I had appreciated. I detect Goldman influence, don't you?<br />Frances Coppolahttps://www.blogger.com/profile/09399390283774592713noreply@blogger.comtag:blogger.com,1999:blog-8764541874043694159.post-79544101847290419092014-12-08T16:06:58.502+00:002014-12-08T16:06:58.502+00:00There is an obvious trade here:
1. get bridge loa...There is an obvious trade here:<br /><br />1. get bridge loan of say €100m<br />2. create SPV<br />3. have SPV buy €100m worth of senior tranche of EIB project<br />3. have SPV (alone or with mates) issue covered bond guaranteed on these (+ admin spread)<br />4. sell covered bond to ECB<br />5. goto 2 (you've just got your €100m back from the ECB)<br /><br />No risk for the trader here, she just makes the admin spread and uses zero long term capital (once the 300B are exhausted she gives back the €100m to the bridge lender). In that scenario it makes sense that it's the EIB that decides what project gets done as after all it's the ECB's money we're spending. Technically there's no monetary financing that a normal electorate can notice.<br /><br />Now I'd like to know is whether this trade is the very point of the scheme and who understands that... Note that even if it's not, it may still work out that way anyway.cighttp://commentisglee.wordpress.com/noreply@blogger.comtag:blogger.com,1999:blog-8764541874043694159.post-15031652182938238172014-12-08T13:11:35.130+00:002014-12-08T13:11:35.130+00:00I'm beginning to feel very sorry for the ECB. ...I'm beginning to feel very sorry for the ECB. The EU has kitchen sinked them with having to solve all the problems that the structure and fiscal problems of each member state are creating. The poor ECB are expected to administer aspirin to the obese smoker EU patient without the EU giving up any of their vices. Polemichttps://www.blogger.com/profile/05985506596290073453noreply@blogger.comtag:blogger.com,1999:blog-8764541874043694159.post-18772483029212256762014-12-08T13:01:28.807+00:002014-12-08T13:01:28.807+00:00Another epic piece from you! I view this as a path...Another epic piece from you! I view this as a pathetic way to get around the stability- and growth pact limits, with little positive potential effects but possibly notable costs later on. Europe does not need financial engineering, but debt restructurings and easier monetary and fiscal policies. <br />Juhani Huopainenhttps://twitter.com/Huopainennoreply@blogger.comtag:blogger.com,1999:blog-8764541874043694159.post-14204246489641947852014-12-08T11:44:16.414+00:002014-12-08T11:44:16.414+00:00Economists who believe it to represent reality som...Economists who believe it to represent reality sometimes wear suits, have fancy degrees, and jobs in the respected halls of academia.<br />epicresearch.cohttp://www.justdial.com/Indore/Epic-Research-Pvt-Ltd-%3Cnear%3E-Opposite-Central-Mall-2-R-N-T-Road/0731PX731-X731-130516184957-J8Q6_SW5kb3JlIEVwaWMgUmVzZWFyY2ggUHZ0IEx0ZCBSIE4gVCBSb2Fk_BZDETnoreply@blogger.comtag:blogger.com,1999:blog-8764541874043694159.post-1926156482851910072014-12-08T10:33:40.514+00:002014-12-08T10:33:40.514+00:00Just another attempt to increase costs without any...Just another attempt to increase costs without any new credits ( to destroy us)<br />The eurozone is the best in the world at going this.<br />The city of Jean had a functional tram operational for two weeks but not enough tokens to run it.<br />My experience of the euro is a drive to continually build more stuff that cannot be used...<br />The function of the euro is simple : it must destroy societies so as to maintain wealth concentrationThe dork of corkhttps://www.blogger.com/profile/01169780628052433662noreply@blogger.comtag:blogger.com,1999:blog-8764541874043694159.post-72948736953111287222014-12-08T09:01:08.780+00:002014-12-08T09:01:08.780+00:00If a private company tried to do this they would -...If a private company tried to do this they would - quite rightly - need to consolidate the entire structure and all of the borrowing would count as debt. This is yet another sign that the European Commission's own accounting is not up to the same levels they require of the private sector (IFRS).Anonymousnoreply@blogger.com