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Tuesday, December 15, 2009 The Fallout from the Dubai Yoyo
One back story that is starting to get traction around the bigger story of bailouts and defaults in Dubai is the story of insider trading. One commentator has his rant: This is the crazy real world. A month ago Nakheel bonds were trading at 110%. They fell below 40 cents two weeks ago. This morning the bonds were trading north of 70. Some of the bonds look to be paid at par. That is enormous price action in a very short period of time. The opportunity to make money on both the downside and the upside was there. Another way to have played the Nakheel bond story was through the CDS market. Pricing in that market mirrored the action for the bonds. Very big bucks were made and lost as this played out. To take advantage of this one would have had to have been an insider. No outsider could have sold high and bought low. So the question is how many insiders were there on this deal? My guess: A few thousand. Is there something else going on or is this pure coincidence? Can it be pure coincidence? Dubai Story Reeks of Insider Trading Labels: Dubai debt, dubailout
posted by grapeshisha at 2:57 PM
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