CDS Hunting Season
CDS Hunting Season
It’s on! Watch every company with exposure in credit default swaps (CDS) get wiped out in the coming weeks.
BTW, I’m going to massively hedge myself tomorrow as the AIG backdoor bailout just kicked the lid off the chart I posted earlier. Of course in true fashion the permabulls are all giddy about this and chances are we but through 1228 at the open (futures are currently lower but I’m not fooled) and then it’s off to the races. Of course, anything can happen in this loony market, thus in my mind anyone not in possession of a working crystal ball effectively has two options at this point:
- Go into cash.
- Hedge yourself to delta neutral.
And just for the record – I love unintended consequences. Or, as the saying goes: The road to hell is paved with good intentions.
P.S.: No, that’s not me in the video – I’m a lot more handsome.