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marketocean - EN - BETA VERSION @market-ocean-en.bsky.social · 11m

Seek professional advice before investing. Not independent research.

marketocean - EN - BETA VERSION @market-ocean-en.bsky.social · 11m

Educational content, not investment advice or recommendation. Past performance doesn't indicate future results. Investments may lose value; you may not recover your investment.

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marketocean - EN - BETA VERSION @market-ocean-en.bsky.social · 11m

rapidly and unpredictably, making regular portfolio reviews crucial during periods of governmental instability.

#FinEd #MarketEducation #Investing #MiFIDII

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marketocean - EN - BETA VERSION @market-ocean-en.bsky.social · 11m

company fundamentals remain sound, due to country risk spillover effects. The situation demonstrates why diversification across geographic regions and credit qualities remains essential in fixed income portfolios. Political risk, unlike some financial metrics, can escalate

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marketocean - EN - BETA VERSION @market-ocean-en.bsky.social · 11m

For European investors, sovereign credit risk affects multiple asset classes. Government bonds see price volatility during political crises, as yields rise to reflect increased risk premiums. Corporate bonds from French companies may also experience spread widening, even if

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marketocean - EN - BETA VERSION @market-ocean-en.bsky.social · 11m

France's mounting deficits combined with leadership changes have prompted rating agencies to issue warnings about potential downgrades. A lower credit rating increases borrowing costs for governments, as investors demand higher yields to compensate for perceived risk.

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marketocean - EN - BETA VERSION @market-ocean-en.bsky.social · 11m

a key factor in determining a country's creditworthiness, alongside fiscal metrics and economic fundamentals. When political turmoil disrupts budget processes, it creates uncertainty around fiscal policy implementation and debt sustainability.

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marketocean - EN - BETA VERSION @market-ocean-en.bsky.social · 11m

France's political instability, marked by Prime Minister Lecornu's resignation and ongoing budget battles, highlights how government dysfunction directly impacts sovereign credit ratings and investor confidence. Credit rating agencies like Moody's and S&P assess political risk as

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marketocean - EN - BETA VERSION @market-ocean-en.bsky.social · 11m

🧵 France political crisis: Government Stability and Credit Risk Assessment

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marketocean - EN - BETA VERSION @market-ocean-en.bsky.social · 41m

Seek professional advice before investing. Not independent research.

marketocean - EN - BETA VERSION @market-ocean-en.bsky.social · 41m

Educational content, not investment advice or recommendation. Past performance doesn't indicate future results. Investments may lose value; you may not recover your investment.

1

marketocean - EN - BETA VERSION @market-ocean-en.bsky.social · 41m

excessive rehypothecation without adequate disclosure or risk controls, leaving creditors surprised when bankruptcy reveals the true complexity of asset claims.

#FinEd #MarketEducation #Investing #MiFIDII

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marketocean - EN - BETA VERSION @market-ocean-en.bsky.social · 41m

complicating recovery. For investors, this highlights the importance of understanding counterparty risk beyond simple creditworthiness. Even well-capitalized financial institutions can face losses when rehypothecation chains break. Corporate governance failures often enable

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marketocean - EN - BETA VERSION @market-ocean-en.bsky.social · 41m

extremely difficult. If Asset A was pledged to Lender B, who pledged it to Lender C, who pledged it to Lender D, determining who actually owns what requires forensic accounting. Assets may have been moved across jurisdictions or through multiple legal entities, further

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marketocean - EN - BETA VERSION @market-ocean-en.bsky.social · 41m

securities as collateral for their own financing. During normal market conditions, this creates liquidity and efficiency. The problem emerges when multiple parties believe they have claims to the same assets. In bankruptcy proceedings, untangling these overlapping claims becomes

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marketocean - EN - BETA VERSION @market-ocean-en.bsky.social · 41m

assets. The First Brands case illustrates how this can unravel catastrophically. Rehypothecation is legal in many jurisdictions and common in prime brokerage and securities lending. A hedge fund pledges securities as collateral for a loan, then the lender uses those same

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marketocean - EN - BETA VERSION @market-ocean-en.bsky.social · 41m

When creditors report that billions have "simply vanished" in a bankruptcy, it often points to a complex practice called debt rehypothecation. This occurs when lenders use borrowed assets as collateral for their own borrowing, creating chains of claims on the same underlying

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marketocean - EN - BETA VERSION @market-ocean-en.bsky.social · 41m

🧵 First Brands Collapse: The Hidden Risks of Debt Rehypothecation

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marketocean - EN - BETA VERSION @market-ocean-en.bsky.social · 1h

Seek professional advice before investing. Not independent research.

marketocean - EN - BETA VERSION @market-ocean-en.bsky.social · 1h

Educational content, not investment advice or recommendation. Past performance doesn't indicate future results. Investments may lose value; you may not recover your investment.

1

marketocean - EN - BETA VERSION @market-ocean-en.bsky.social · 1h

When you feel uncomfortable making an investment because everyone else disagrees, that discomfort itself might signal an opportunity rather than a warning.

#FinEd #MarketEducation #Investing #MiFIDII

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marketocean - EN - BETA VERSION @market-ocean-en.bsky.social · 1h

during panic. The ability to maintain conviction when facing majority opposition demands significant emotional control and confidence in one's research process. Understanding this psychology helps European investors recognise their own decision-making patterns.

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marketocean - EN - BETA VERSION @market-ocean-en.bsky.social · 1h

inefficiencies. Carleton's decision required filtering out emotional noise and focusing on fundamental analysis despite growth concerns. This psychological discipline separates professional money managers from retail investors who typically buy high during optimism and sell low

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marketocean - EN - BETA VERSION @market-ocean-en.bsky.social · 1h

psychology. When short interest concentrates heavily in a stock, it signals widespread negative sentiment. Most investors feel uncomfortable buying what others are selling, as our brains are wired to seek safety in consensus. This herd mentality often creates market

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marketocean - EN - BETA VERSION @market-ocean-en.bsky.social · 1h

were betting against the stock. Yet Carleton increased his position, illustrating how professional investors often move against prevailing sentiment. This behaviour reflects what behavioural finance calls contrarian investing, where managers deliberately act opposite to crowd

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