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HOLY SH*T! The Collateral Markets Are Starting to Freeze

Eurodollar University

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Strains in Collateral Markets: The Impact of Italian Bonds

This chapter explores the potential strain in collateral markets caused by the revaluation of Italian bonds, highlighting the direct links between Italian debt and US dollar funding and the concerns of European and Japanese dollar providers. It also discusses the compression of US dollar swap spreads and the negative interest rate swap spread, drawing correlations with Japanese government bills and Italy to Germany spreads.

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