While traditionally one would trade bonds to make such bets, by entering into either side of an interest rate swap agreement, you would gain immediate exposure to interest rate movements with virtually no initial cash outlay.
But, at minimum you must recognize that you are arguing that the US government enter into an interest rate swap with the Global Financial system because you that your intuition about the path of interest rates is superior to that of the Global Bond Market.
If the US government collects taxes and uses those taxes to reduce the deficit it is entering into an interest rate swap.
It is a founding member of ERIS, which has developed a futures contract that mimics a variable Libor-based interest rate swap.
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Since the income from the projects is not dependent on interest rates, the company entered into interest rate swap agreements which act as hedges.
According to Reuters, the two-year U.S. interest rate swap spread--a gauge of financial system stress--was quoted at a record high 166.5 basis points in Asia, suggesting that concern about defaults among banking counterparties were worsening.
Every day that the US government takes your tax money and uses to avoid issuing more 10 year Treasury Bonds is a day that the US government is buying an Interest Rate Swap on your behalf.
This is an interest-rate swap and you as a tax payer have now bought one, whether you like it or not.
And Real have issued a statement denying any interest in a swap deal involving their former Liverpool striker Michael Owen and Reyes.
In a typical interest-rate swap, one party agrees to exchange a fixed-rate obligation with another that has a floating, or variable, rate exposure.
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As we came out of the housing crash rubble, one mini-narrative that emerged on the left was the rottenness of interest-rate swap deals.
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Interest-rate swap agreements are essentially financial bets many states and cities made in recent years in the hope of protecting themselves from higher rates.
All this high-flying adventure--plus some bad bets on Harvard's part in the interest-rate swap market that had apparently been the brainchild of former university president Lawrence Summers--created a perfect financial storm.
For one thing, it is hard to know how much companies have in fact lengthened the maturity of their debts because the interest-rate swap market allows them to swap those fixed bond payments into cheaper floating debt, a popular strategy in the investment-grade market.
One major risk (other than the obvious interest rate risk) for swap investors is that of counterparty risk.
After years of high interest rates, a modest public-debt swap in 2010 cut short-term borrowing costs.
The swap is likely to result in a significantly lower interest rate being paid by Jamaica to its lenders.
His comments come as Greece is asking private investors to swap their current Greek bonds for others that pay less interest over a longer term.
The bail-out deal agreed with Greece in July already included a limited move by private banks to swap existing Greek debt with longer term debt paying lower interest.
My plan was this: Take a zero interest transfer credit offer from a credit card company when the 12 months was up and swap the charge forward to another company.
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The swap involved a bet on the difference between two-year and ten-year interest rates.
The economy ministry also hopes to cut its interest burden by strong-arming pension funds (over sour looks from the big rating agencies) to swap short-dated government paper for long-term bonds.
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