Category Archives: Derivatives

More on Frank Partnoy’s Misguided Take on Collateralized Loan Obligations

No, collateralized loan obligations are not about to wipe out banks, and Frank Partnoy should have focused on real risks, like destruction of productive capacity.

Universa Debunks CalPERS’ Defense of $1 Billion Tail Hedge Miss; Insider Accounts Expose Additional Misrepresentations

CalPERS efforts to ‘splain away its $1 billion tail hedge fiasco backfire as one of the tail risk managers, Universa, shreds CalPERS’ claims.

Why the Oil and Gas Industry Will Never Be the Same

An overview of the dislocations in the oil market.

The Worst Is Yet To Come for Oil Prices

Collaping oil prices demonstrate the severity of the fall in real economy activity.

Taleb Questions CalPERS Ben Meng’s Competence and Honesty in Defending Missed $1 Billion Hedge Gain; Taleb Estimates CalPERS Net Loss on Meng’s “Alternative Mitigation” Over Two Years at $19 Billion

Nassim Nicholas Taleb calls out one of CalPERS CIO Ben Meng’s Big Lies, and unearths an even bigger one.

Coronavirus: Bracing for the Economic Shockwave

The coronavirus spread is setting up a nasty real economy-financial system contraction.

Foreign Exchange Swaps: Hidden Debt, Lurking Vulnerability

How hidden foreign exchange swaps contribute to financial fragility.

Wolf Richter: How Ratings Agencies Inflate Credit Ratings to Get Deals & Fees

Haven’t we already seen this movie? Race to the bottom in gaming credit ratings agencies for commercial real estate Collateralized Loan Obligation deals.

Why the UK Needs a Financial Transaction Tax

Claims that a financial transaction tax would be difficult to implement and raise little revenue are fake news.

Wall Street Has Been Gambling With Student Loan Debt For Decades

As the student debt crisis continues to mount, major financial institutions are making record profits from student loan asset backed securities.

Interest Rate Derivatives Trading Explodes to $6.5 Trillion/Day

Interest rate derivatives trading spikes over last 3 years; the UK currently dominates. Will this continue post-Brexit?

Deutsche Bank Throws in the Towel, Announces Restructuring into Bad Bank/Good Bank, Firing of 18,000

The beginning of an end for Deutsche Bank.

Mr. Market’s Hissy Fit May Be Over….For Now

Puzzling out the markets have changed, and not changed, since the crisis.

Brexit Chaos

It’s getting harder to figure out what exactly is happening on the Brexit front, but even through the fog of negotiations, things don’t seem to be getting any better.

Brexit Derivatives Risk: Did the City Overplay Its £38 Trillion Hand?

Novating UK derivatives contracts entered into by EU clearinghouse members is a ginormous mess, particularly in a Brexit crashout. But how serious a mess?