Farmers Shouldn't Play with Credit Derivatives!posted by MR WAVETHEORY at 9/19/2007 03:14:00 AM
Calyon - aka the French Agricultural Bank - blew 250 million euros on credit swaps showing that farmers should stick to farming - not trading credit derivatives! LOL! Apparently, Calyon (aka Credit Agricole aka French Agricultural Bank) had fortuitous timing - they waited 2 weeks - until the Fed rate reduction - before announcing the results of their tragic gamble.
Agricole senior management were told on Sept. 4 that Calyon had an unusually large market position at the propriety trading desk of its New York-based business. It said that unwinding the position would cut Calyon's third-quarter earnings by EUR250 million.
The bulk of the position had been built up at the end of last month and was centered on certain credit market indices, which Calyon did not name, although it stressed that none of the trades was linked to the US sub-prime mortgage sector.
Caylon says they have taken the necessary disciplinary actions against the rogue traders.
Do you see the picture above? Yes, the decapitated bodies. Those are the statues next to Calyon headquarters on Avenue of the Americas in New York. I have a feeling that's what happened to the rogue traders.