s404n1tn0cc
2 days ago
BING
And what is the premium?
In the context of swaps agreements, the term "premium" isn't typically used. Instead, we talk about notional principal, fixed rates, floating rates, or spread.
The notional principal is the amount upon which the exchanged interest payments are based, but it's not actually exchanged between the parties.
Would you like more details on any specific type of swap or another aspect of swaps agreements?
OK 3 percent loan 100 million due in 5 years. With a reurn of Ten times
Let's break this down to see what you're looking at:
Loan Amount: $100 million
Interest Rate: 3% per annum
Duration: 5 years
Return of Ten Times: Assuming you mean you want to calculate a return that's ten times the investment.
First, let's calculate the interest on the loan:
Interest per year: $100 million * 3% = $3 million
Total Interest over 5 years: $3 million * 5 = $15 million
At the end of 5 years, you would owe the principal plus the interest:
Total Repayment Amount: $100 million + $15 million = $115 million
For a tenfold return on your initial $100 million investment:
Desired Return: $100 million * 10 = $1 billion
If you need to achieve a tenfold return, you would be looking to generate $1 billion from your investment over 5 years. Achieving this would likely involve high-return investments, business ventures, or other financial instruments well beyond the simple interest on a loan.
Would you like to explore different investment options or any other financial scenarios? 😊
remember this a swap agreement at 100 million A paper.
Got it! We're dealing with a swap agreement involving a $100 million A-rated (investment grade) paper. Let's assume this is an Interest Rate Swap with the following details:
Notional Principal: $100 million
Fixed Rate: 3%
Term: 5 years
If we're looking at a swap with a fixed-rate loan and the goal of achieving a tenfold return over 5 years, here’s a hypothetical scenario:
Fixed Payments: You're paying a fixed 3% interest rate on the $100 million notional principal.
Annual Payment: $100 million * 3% = $3 million
Total Payment over 5 years: $3 million * 5 = $15 million
Floating Rate Side: If you’re receiving returns from the swap, those returns would come from the variable interest rate or performance of an underlying asset.
To achieve a tenfold return, the floating side must generate returns significant enough to surpass the fixed payments. Here's an illustration:
Total Desired Return: $100 million * 10 = $1 billion
Total Fixed Payments: $15 million
Net Return Needed: $1 billion - $15 million = $985 million
This implies that the floating rate leg or the underlying asset in the swap needs to perform extraordinarily well to achieve this kind of return.
Would you like more details on how such high returns might be achieved, or do you have other specific aspects of swaps you'd like to explore? 😊
and what is my premium
In the context of a swap agreement, we don't typically use the term "premium" as we might with insurance or certain types of options. Instead, the key terms are usually the fixed rate, floating rate, and notional principal.
For your swap agreement:
Fixed Rate: 3%
Notional Principal: $100 million
Term: 5 years
The "premium" in swaps can be thought of as the difference between what you pay and what you receive. In an interest rate swap:
You Pay: 3% annually on the notional principal ($3 million per year)
You Receive: Returns based on the floating rate or the performance of an underlying asset
In your case, if your goal is a tenfold return, the floating leg of your swap needs to generate significantly higher returns over the fixed payments.
If you have more specifics or need details on a different type of swap, feel free to let me know! 😊
Thats what I'm asking .. The bank charges a premium for a potential return of 10 times my investment. what is the premium chraged for this protection
Got it! When you're discussing a swap agreement with a bank and the potential for a significant return (like ten times your investment), the premium you're referring to can be considered the cost of the protection or the additional cost over the standard terms.
In such high-stakes scenarios, the premium might be calculated based on several factors:
Risk Assessment: The higher the perceived risk of achieving those returns, the higher the premium.
Market Conditions: Current interest rates, economic stability, and market volatility can influence the premium.
Credit Rating: Your creditworthiness or the quality of the underlying asset can impact the premium.
In a typical setup, the bank might charge an upfront fee or an additional percentage on top of the fixed rate to account for the extra risk they're taking on.
Let's assume the bank charges an additional 2% as a premium for this protection:
Premium Amount: $100 million * 2% = $2 million
So, along with the fixed rate payments, you might pay this premium as part of the agreement to secure the potential high return.
These specifics can vary significantly based on the terms of the swap and the bank’s policies. It's always a good idea to have detailed discussions with the financial institution to understand all costs and terms involved.
If you have any other questions or need further details, feel free to ask! 😊
FWIW So 5 percent interest to cover 10X for protection.
s404n1tn0cc
3 days ago
Of couse its fraudulent ..
He's approx what the Lawyers said
"Prior to the 2008 financial crisis, the over-the-counter (OTC) derivatives market, including swaps, was largely unregulated. This lack of regulation contributed significantly to the crisis. Here's what happened regarding failures to pay and the consequences (or lack thereof) before 2008:
1. Lack of Transparency:
The OTC derivatives market was opaque. There was no central reporting or clearing of transactions. This made it difficult to assess the overall size and risk exposure of the market. Regulators had limited visibility into who was exposed to what.
2. Bilateral Agreements and Counterparty Risk:
Swaps were primarily traded through bilateral agreements between two parties. This meant that each party was exposed to the credit risk of the other party (counterparty risk). If one party failed to meet its obligations, the other party could suffer significant losses.
3. Limited Regulation:
There was limited regulatory oversight of the OTC derivatives market. This meant that there were few rules regarding capital requirements, risk management, or reporting.
4. Consequences of Failure to Pay:
If a party failed to pay on a swap contract, the counterparty would typically try to recover its losses through legal means, such as lawsuits.
However, due to the lack of transparency and standardization in the market, it could be difficult and time-consuming to resolve disputes.
In some cases, failures to pay could lead to cascading defaults, where the failure of one party triggers failures by other parties who were exposed to them. This is precisely what happened with AIG and its credit default swaps, which played a key role in the 2008 crisis.
5. Contributing Factors to the 2008 Crisis:
The lack of regulation and transparency in the OTC derivatives market amplified the risks associated with complex financial instruments like credit default swaps (CDS).
Many financial institutions were highly leveraged and had significant exposure to counterparty risk.
When the housing bubble burst and defaults on mortgages increased, it triggered a cascade of losses in the derivatives market, leading to the financial crisis.
In summary:
Before 2008, the OTC derivatives market was a "Wild West" with limited regulation and oversight. Failures to pay were a significant risk, and the lack of transparency and standardization made it difficult to manage these risks.
This ultimately contributed to the severity of the 2008 financial crisis. The Dodd-Frank Act, passed in the wake of the crisis, aimed to address these issues by increasing regulation and transparency in the derivatives market.
So Could lehman sue for Trillions?...Yes But it decides not to. Seem their retarded by their Lawyers(Paid OFF) LIike Madoff.. On purpose. IMO
I Just Keep Laughing. See you in Vages... NOT HAHAHAH
cottonisking
3 days ago
Read it again, we are talking about Series P preferred stock that we own, along with BlackRock. Man, did you see the link? Your head is locked on AGFP/LBIE motions. You have been posting the same thing for six months. We are following BlackRock now.
It was risky for LBHI to offer $4 Billion in P shares in April 2008. Our P shares are probably covered by Derivatives. Remember the Sunday, September 14 Derivatives trading sessions based on LBHI filing Bankruptcy on September 15, 2008? 😂