I spent a few minutes over the weekend wandering through the latest DTCC weekly credit default swap data release. I compared the current release with the prior week in terms of notional, net, and total contracts. The following table summarizes the top dozen entities in terms of increases and decreases in percentage terms in the number of outstanding CDS contracts. (The list is filtered down to those with at least 1,000 pre-existing outstanding contracts.)

Downtown Kuala Lumpur is a veritable forest of construction cranes, with condos projects going up everywhere. Prices strike me as high, with some large complexes having units only from a million U.S. dollars and up. Similarly, on the way in from the airport to the city you see fields of ochre-roofed tract real estate developments all around, most of which are half-empty (my driver said) and had been built in the last two years.

So, is there a real estate bubble here? Most people I spoke to here assured me that there isn’t, that downpayments are hefty and people can’t play the sort of low-payment games that they can in the U.S. That was mildly reassuring, at least until I saw the following advertisement in a local paper. Check the highlighted sections.

A great catch of a reference to a credit crunch in ancient Rome:

Accusers were now intensely active. Their present targets were men who enriched themselves by usury, infringing laws by which the dictator Julius Caesar had controlled loans and land-ownership in Italy. Since patriotism comes second to private profits, this law had long been ignored. Money-lending is an ancient problem in Rome, and a frequent cause of disharmony and disorder. Even in an earlier, less corrupt society steps had been taken against it. At first, interest had been determined arbitrarily by the rich, but then the Twelve Tables had fixed the maximum at 10 per cent. Next, a tribune’s law had halved the rate. Finally loans on compound interest were forbidden completely. Fraudulence, attacked by repeated legislation, was ingeniously revived after each successive counter-measure.

Now, however, the praetor Sempronius Gracchus, responsible for the investigation, was compelled by the numbers of potential defendants to refer the matter to the senate. That body - being implicated to a man - nervously entreated the emperor's indulgence. It was granted. Eighteen months were allowed in which all private finances had to be brought into line with the law. The result was a shortage of money. For all debts were called in simultaneously, and the numerous convictions and sales of confiscated property had concentrated currency in the Treasury and its imperially controlled branches. To meet this situation the senate had instructed that creditors should invest two-thirds of their capital in Italy, and debtors immediately pay the same proportion of their debts.

However, creditors demanded payment in full, and debtors were morally bound to respond. The first results were importunate appeals to money-lenders. Next, the praetors’s court resounded with activity. The decree requiring land purchase and sales, envisaged as relief, had the opposite effect since when the capitalists received payment they hoarded it, to buy land at their convenience. These extensive transactions reduced prices. but large-scale debtors found it difficult to sell; so many of them were ejected from their properties, and lost not only their estates but their rank and reputation.

Then Tiberius came to the rescue. He distributed a hundred million sesterces among specially established banks, for interest-free three year state loans, against security of double the value in landed property. Credit was thus restored; and gradually private lenders, too, reappeared. However, land transactions failed to adhere to the provisions of the senatorial decree. As usual, the beginning was strict, the sequel slack.

[via Tired Fools]