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The New DU. Reply #23: you may have just answered a question I raised down thread...
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salin
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Sun Mar-09-08 03:05 PM
Response to Reply #19 |
| 23. you may have just answered a question I raised down thread... |
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So Morgan calls in its margin (I believe that is the difference between the original loan for the CDOs and the decline in value of the CDO) to several Wall Street banks or risk going into default. The article also said similar margin calls were likely to other banks. My question was what happens to the lendee bank if it goes into default. If the same rules apply that you list above, then it would suggest that the JP Morgan could call in the entire outstanding debt on the loan.
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