International Law

Tulips and Promissory Notes

Collateral calls from Marketplace on Vimeo.

Nice discussion about collateral calls and credit default swaps.

Think about tulip futures contracts, promissory notes written in a bar, combined with margin calls on the promissory note.

How did the Tulip bubble end? With the Dutch Parliament not allowing either party of the futures contract or promissory notes access to the Courts to enforce their agreements on the grounds that these were gambling debts.

Nice solution.

(Thanks to Paul Kedrosky for pointing out the credit default swap video.)

Full post as published by Misleading Advertising Law on March 26, 2009 (boomark / email).