Contagion: Chain Reactions and the CoCo Powder Keg
Many Happy Returns
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Credit Suisse - What's the Debt Book?
When I read the Bank of England statement about Silicon Valley Bank, it just was ringing alarm bells in my head. The word that sets alarm bells ringing for me there is direct. Because contagion is often an indirect consequence. So maybe we should come on to the sort of transmission mechanisms of contagion. Let's start with the first obvious one: if a financial institution does go bankrupt and it has debt, that debt is sitting on someone else's balance sheet and is now distressed. And lots of people have been buying things like cocoa bonds, all of the cocoa bonds for credit Swiss have essentially been marked down to zero.
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