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**hhynmtrxcp** · 07-10-2012, 04:08 AM

No. On the derivatives I mean if we trade a swap on $10m notional, 5% Vs float and the net difference until termination is $50,000, then the contract is 'worth' $50,000, not $10m and not even 5% of $10m over 2 years.

On the debt, I mean if I lend you $100, and you lend $90 of that to a friend and he lends $50 of that to another friend, the principle outstanding (and thus the debt) is still $100, not $240.

I see. (I was being tongue-in-cheek).

Correct me if I am wrong but it sounds like you are saying the actual value, not the leveraged value, should be reported.

07-10-2012, 04:08 AM	#60
hhynmtrxcp Join Date Oct 2005 Posts 444 Senior Member	No. On the derivatives I mean if we trade a swap on $10m notional, 5% Vs float and the net difference until termination is $50,000, then the contract is 'worth' $50,000, not $10m and not even 5% of $10m over 2 years. On the debt, I mean if I lend you $100, and you lend $90 of that to a friend and he lends $50 of that to another friend, the principle outstanding (and thus the debt) is still $100, not $240. I see. (I was being tongue-in-cheek). Correct me if I am wrong but it sounds like you are saying the actual value, not the leveraged value, should be reported.
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