Yves Smith, as reported on Jesse's Cafe Americain:

Quote:
03 October 2008
Waves of Credit Default Swaps Incoming


Have you wondered why the Treasury asked for a $700 Bn emergency package with the full force of the Fed behind them, and gave the Congress less than a week to deliver it?

Either these fellows have lost their nerve or the markets are riding to a fall, and it could be terrific.

We've been looking for some event, something that would have created such an extraordinary set of actions as we have seen in the past few days.

This just might be it. Special thanks to Yves Smith for flagging it.

Time to start settling those Credit Default Swaps for Fannie and Freddie (Oct. 6), Lehman Brothers (Oct. 10) and Lehman Brothers (Oct 23).

LIBOR is eight standard deviations from the norm, because the banks don't know who is holding what in their cards, but there might be some Aces and Eights in there. The TED spread is at an all time record high.

An insurance company is said to be heavily exposed.


CDS settlements for Freddie on Oct 6 will make for a VERY interesting day. Let's see what happens.
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“These capitalists generally act harmoniously and in concert to fleece the people, and now that they have got into a quarrel with themselves, we are called upon to appropriate the people’s money to settle the quarrel.”

– Abraham Lincoln, speech to Illinois legislature, January 1837