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re: Update pg 23: Russia,IMO, will default on its sovereign debt within six months
Posted on 11/20/14 at 10:41 am to LSURussian
Posted on 11/20/14 at 10:41 am to LSURussian
quote:
The most recent Russian sov. debt CDS rate I can find is dated 10/24/14 and the rate rose 8 basis points to 263.86. Eta: By comparison, the current US 5-year CDS is 17.50.
263 isn't very scary. By contrast, Venezuela's is over 2000, which implies only about a 35% chance of default over the next 2 years.
Russia's chance of default over the next year - the time period of your prediction - as calculated according to CDS spreads (which now look to be about 300) is less than 5%.
So, am I right to assume that your prediction in the OP can be read as saying the CDS market is off by orders of magnitude? Your prediction appears to be 100% chance of default within 12 months (although your thread title still says 6 months). Global trading markets in such things imply that the chances are 95% lower than your estimation.
Question: how are you attempting to profit from this knowledge of yours and how can the rest of us participate as well? I would love to place a bet on a certainty that is basically being shrugged off by the market.
LINK
Posted on 11/23/14 at 10:11 pm to Big Scrub TX
Of all the countries listed in the link you gave Russia is rated the 4th "riskiest" country in the world as determined by CDS.
Only Argentina, Venezuela and Ukraine are shown with a higher sovereign debt risk. Everyone knows those countries are in complete chaos financially so being only slightly less risky than them is still very risky.
So I'm not sure how my opinion of Russia's financial condition disagrees all that much from what the CDS is indicating.
To answer your question, I have no interest in profiting from Russia's situation so I can't help you there.
Only Argentina, Venezuela and Ukraine are shown with a higher sovereign debt risk. Everyone knows those countries are in complete chaos financially so being only slightly less risky than them is still very risky.
So I'm not sure how my opinion of Russia's financial condition disagrees all that much from what the CDS is indicating.
To answer your question, I have no interest in profiting from Russia's situation so I can't help you there.
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