15 May 2008
The last claim
It would take a cataclysm around a third of the leading investment-grade corporations in Europe or half those in North America going bankrupt and defaulting on their debt for the insurance to be paid out.
I asked one investment banker what might cause half of North America’s top corporations to default. No ordinary economic recession or natural disaster short of an asteroid strike could do it: no hurricane, for example, and not even "the big one," a catastrophic earthquake devastating California. All he could think of was "a revolutionary Marxist government in Washington."
This would seem unlikely even the leftiest of incoming Democrats are run-of-the-mill Marxists at best but just the same, the premium has increased of late:
Normally one can buy $10 million of end-of-the-world insurance for between two and three thousand dollars a year. By early last November, the prices quoted were between twenty and thirty thousand, and even then it was difficult to buy in quantity at least, said the banker, "not from anyone you trusted."Posted at 7:08 AM to Dyssynergy