What’s a Default? Argentina’s Debt Buyback Splits S&P, Moody’s

Traveler said:
"I'll gladly pay you Tuesday for a hamburger today".....J. Wellington Wimpy, advisor to Alberto.
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It is the International Swaps and Derivatives Association Determinations Committee which is the ultimate arbiter of whether or not a credit default has occurred; not Moodys. Just ask Kicillof.
 
Greg M said:
It is the International Swaps and Derivatives Association Determinations Committee which is the ultimate arbiter of whether or not a credit default has occurred; not Moodys. Just ask Kicillof.
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Have you ever seen "The Big Short"?
If not, you should watch it. Best explanation available of what really happened in 2007/2008, and the role played by Moody's and S&P in that debacle.
The point I'm making here is that the rating agencies play a huge role in creating perceptions, and of course perceptions shape the market, sometimes more than reality.
 
Greg M said:
It is the International Swaps and Derivatives Association Determinations Committee which is the ultimate arbiter of whether or not a credit default has occurred; not Moodys. Just ask Kicillof.
Click to expand...
We are talking about two separate issues here. The three major ratings agencies (Standard and Poor, Moody's and Fitch) can adjust ratings on individual bonds to default/ selective default based on actions taken by the issuer that violate the bond contracts.

ISDA is the ultimate arbiter of whether a "credit event" has occurred which would trigger the payout of credit default swaps and other derivatives. Hence why ISDA is the International SWAPS and DERIVATIVES association.
 
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