re: Update pg 23: Russia,IMO, will default on its sovereign debt within six months

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I believe it's more transparent to Goldman or BNP than it is to the rest of us and they have real money in the game.

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Okay, whatever you want to believe, that's fine with me. So just ignore my comments on Russia. That's fine with me, too.

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it's an extraordinarily cheap lottery ticket.

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Lottery tickets are bought by people who suck at math.

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you don't actually believe it's 100% chance they will default.

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Does the "IMO" in the thread's subject line confuse you?

why is there always a jackass to come along and ruin a civil informative thread?

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Meaning you know more than Goldman?

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When it comes to understanding the Russian mentality? Probably so.

When I was working in Russia, I was advising Goldman whiz kids, along with a host of European investment banks, not to buy Russian debt in 1997 and the first half of 1998. I told them they were being misled by the Central Bank of Russia and the Ministry of Finance. I participated in writing a paper to the IMF and World Bank in May, 1998 that Russia would default on its debt either in the late summer or early autumn of that year simply based on the amount of debt coming due and the timing of the debt's maturity. The investment banks bought the Russian debt anyway. Russia defaulted in mid-August. And the banks lost 100% of their money.

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Lottery tickets are bought by people who suck at math.



No. Options are bought sold by some of the smartest people in the world

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Did you just change "lottery tickets" to "options" equating the two as being the same thing??

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All I've seen you do is say that they will default.

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If you want to think otherwise, I'm perfectly okay with that.

I suspect your real goal is to try and impress others with your grasp of financial instruments and terminology. Good for you!!

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I'm trying to make some money.

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I'm not giving you investment advice on Russia. Don't interpret what I've written to be investment advice. This is the Political Board and my thread is about the politics of Russia.

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What rational person would ignore trying to profit on something that they are saying is 24X more likely to happen than the markets are pricing in?

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Me.

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When it comes to understanding the Russian mentality? Probably so.

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OK. You are citing events from almost 20 years ago. I in no way believe financial markets to be infallible and I dislike Goldman. But I think it's fair to say that they have made it a business practice to be as in bed with governments as they can since then. In any event, Goldman is but one of probably 20 dealers making markets in Russian CDS. It's probably possible even to come up with dozens of negative research reports from those dealers themselves, citing many of the points you mentioned in this thread.

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And the banks lost 100% of their money.

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Really? I thought the recovery rate was closer to 18% or so.

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Did you just change "lottery tickets" to "options" equating the two as being the same thing??

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No. My only point is you can risk very little money to make a lot of money...and knowing what you claim you know, it would be rational behavior to do so and not properly labeled as "speculation". (Certainly not more "speculative" than buying a stock because you think it's cheap to where the market is pricing it.)

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If you want to think otherwise, I'm perfectly okay with that.

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I certainly think it's possible they default. I just want to know what you know that isn't being priced in. You don't seem to understand the relative pricing vs the other 3 countries you listed, so I'm overall puzzled by your "analysis".

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Me.

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Well, it might be you but it certainly isn't rational.

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All I believe is that your prediction is vastly out of phase with a global trading market

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This is the same conspiracy kook who predicted a terrorist attack on 9/11 (2014).

You'd get better advice from a fortune cookie.

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This is the same conspiracy kook who predicted a terrorist attack on 9/11 (2014).

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LSURussian? That seems unlikely to me. If anything, I would expect the record to reflect him debunking other posters making that sort of prediction.

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Putin Just Announced A Massive Foreign Currency Bailout For Russia's Collapsing Banks

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In his annual address to the nation on Thursday, Russian President Vladimir Putin announced that the country's reserve funds, usually earmarked for investment in state projects, should be used to bail out troubled Russian banks. In doing so he revealed just how grim the prospects for financial institutions have become following the rouble's collapse. The Russian private sector appears to be on state-funded life support.

In particular, the move strongly suggests that the Russian banking system has been running out of collateral that can be used to get dollars from the central bank. Access to dollars is critical because the banks took out foreign-currency loans from investors that they have to pay back in the same currency. Current estimates suggest Russian businesses need to repay $35 billion this month.

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LINK

Alpha, I think they call it