# who wins when the pandemic bonds are triggered?
**URL:** https://boards.straightdope.com/t/who-wins-when-the-pandemic-bonds-are-triggered/849360
**Category:** The Quarantine Zone
**Tags:** covid-quarantine
**Created:** [March 12, 2020, 7:28pm UTC](https://boards.straightdope.com/t/who-wins-when-the-pandemic-bonds-are-triggered/849360 "2020-03-12T19:28:10Z")
**Posts on this page:** 14
**Page:** 1
### Author:  [@Jim\_Peebles](https://boards.straightdope.com/u/Jim_Peebles)
#### Post date: [March 12, 2020, 7:28pm UTC](https://boards.straightdope.com/t/who-wins-when-the-pandemic-bonds-are-triggered/849360/1 "2020-03-12T19:28:10Z")
So 330 million in bonds were sold to investors who will lose their money when the coronavirus meets certain conditions:
> **[Pandemic Emergency Financing Facility](https://en.m.wikipedia.org/wiki/Pandemic_Emergency_Financing_Facility)**
>
> The Pandemic Emergency Financing Facility (abbreviated as PEF, and also known as Pandemic Bonds) is a controversial financing mechanism intended to assist governments and aid agencies with the management of a pandemic outbreak. It is provided by the World Bank, which raised the majority of the money by issuing $320m in bonds (which can be considered as a type of catastrophe bond) and $105m in swaps to private investors,
> Additional funding was provided by approximately $190m in donations from thr...
My guess is they will. But I have heard trillions of dollars of bets have been placed on them in the form of derivatives. Can we trace who will win the most money from their bets when the conditions are met?
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### Author:  [@Keeve](https://boards.straightdope.com/u/Keeve)
#### Post date: [March 12, 2020, 9:10pm UTC](https://boards.straightdope.com/t/who-wins-when-the-pandemic-bonds-are-triggered/849360/2 "2020-03-12T21:10:40Z")
Thanks for that link. I’m skimming that article and the linked one titled “Catastrophe bond”. I’m blown away that this even exists. It is incredible what a variety of financial things there are out there.
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### Author:  [@Exapno\_Mapcase](https://boards.straightdope.com/u/Exapno_Mapcase)
#### Post date: [March 12, 2020, 10:14pm UTC](https://boards.straightdope.com/t/who-wins-when-the-pandemic-bonds-are-triggered/849360/3 "2020-03-12T22:14:27Z")
> [@Jim\_Peebles](#):
>
> But I have heard trillions of dollars of bets have been placed on them in the form of derivatives. Can we trace who will win the most money from their bets when the conditions are met?
Where have you heard such things? Please give a cite.
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### Author:  [@Jim\_Peebles](https://boards.straightdope.com/u/Jim_Peebles)
#### Post date: [March 12, 2020, 11:35pm UTC](https://boards.straightdope.com/t/who-wins-when-the-pandemic-bonds-are-triggered/849360/4 "2020-03-12T23:35:23Z")
> [@Exapno\_Mapcase](#):
>
> Where have you heard such things? Please give a cite.
I gave a wikipedia link. I recalled an article about it from a while ago (before Covid-19) and started wondering. If no one knows: is it even possible to find out? If the world suspects nefarious doings, what sort of legal strings can be used to investigate? Betting a pandemic will trigger the bonds, and then releasing a bioweapon, or overblowing a run of the mill virus (I think the latter is more likely the case), is the sort of thing the world should investigate.
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### Author:  [@Gray\_Ghost](https://boards.straightdope.com/u/Gray_Ghost)
#### Post date: [March 12, 2020, 11:56pm UTC](https://boards.straightdope.com/t/who-wins-when-the-pandemic-bonds-are-triggered/849360/5 "2020-03-12T23:56:59Z")
> [@Exapno\_Mapcase](#):
>
> Where have you heard such things? Please give a cite.
Article in _Nature_ on the World Bank’s Pandemic Emergency Financing Facility here:
[Pandemic bonds: designed to fail in Ebola](https://www.nature.com/articles/d41586-019-02415-9)
Seems like a large conflict of interest, but what do I know? The prospectus for the security may be found here: [Public Documents Error](http://pubdocs.worldbank.org/en/882831509568634367/PEF-Final-Prospectus-PEF.pdf)
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### Author:  [@Exapno\_Mapcase](https://boards.straightdope.com/u/Exapno_Mapcase)
#### Post date: [March 13, 2020, 1:22am UTC](https://boards.straightdope.com/t/who-wins-when-the-pandemic-bonds-are-triggered/849360/6 "2020-03-13T01:22:19Z")
> [@Jim\_Peebles](#):
>
> I gave a wikipedia link.
That had nothing to do with the claim that “trillions of dollars of bets have been placed on them in the form of derivatives.” That’s an absolute looney tunes conspiracy theory that you haven’t even tried to justify.
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### Author:  [@Jim\_Peebles](https://boards.straightdope.com/u/Jim_Peebles)
#### Post date: [March 13, 2020, 1:42am UTC](https://boards.straightdope.com/t/who-wins-when-the-pandemic-bonds-are-triggered/849360/7 "2020-03-13T01:42:18Z")
> [@Exapno\_Mapcase](#):
>
> That had nothing to do with the claim that “trillions of dollars of bets have been placed on them in the form of derivatives.” That’s an absolute looney tunes conspiracy theory that you haven’t even tried to justify.
Can you provide a link that there are no derivatives? That would be a good solution to the original question.
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### Author:  [@Exapno\_Mapcase](https://boards.straightdope.com/u/Exapno_Mapcase)
#### Post date: [March 13, 2020, 2:00am UTC](https://boards.straightdope.com/t/who-wins-when-the-pandemic-bonds-are-triggered/849360/8 "2020-03-13T02:00:56Z")
> [@Jim\_Peebles](#):
>
> Can you provide a link that there are no derivatives? That would be a good solution to the original question.
It’s your claim. You haven’t even said where you heard it, despite being asked directly. If you want us to believe in what seems to be babbling internet bullshit, you’re the one who has to back up what you post.
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### Author:  [@Exapno\_Mapcase](https://boards.straightdope.com/u/Exapno_Mapcase)
#### Post date: [March 13, 2020, 2:06am UTC](https://boards.straightdope.com/t/who-wins-when-the-pandemic-bonds-are-triggered/849360/9 "2020-03-13T02:06:22Z")
> [@Jim\_Peebles](#):
>
> Can you provide a link that there are no derivatives? That would be a good solution to the original question.
It’s your claim. You haven’t even said where you heard it, despite being asked directly. If you want us to believe in what seems to be babbling internet bullshit, you’re the one who has to back up what you post.
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### Author:  [@Jim\_Peebles](https://boards.straightdope.com/u/Jim_Peebles)
#### Post date: [March 13, 2020, 2:24am UTC](https://boards.straightdope.com/t/who-wins-when-the-pandemic-bonds-are-triggered/849360/10 "2020-03-13T02:24:39Z")
> [@Exapno\_Mapcase](#):
>
> It’s your claim. You haven’t even said where you heard it, despite being asked directly. If you want us to believe in what seems to be babbling internet bullshit, you’re the one who has to back up what you post.
This is a place for fun discussion and asking others when you are too lazy to research it yourself. This article:
> **[Call a pandemic a pandemic: 'pandemic bonds' and how casino capitalism is...](https://morningstaronline.co.uk/article/call-pandemic-pandemic-pandemic-bonds-and-how-casino-capitalism-endangering-us-all)**
>
> A cynical desire to save money is the reason why governments are refusing to say how serious the coronavirus crisis really is, explains ALAN SIMPSON
says:
"In 2017, $425 million of these “pandemic bonds” were issued, with sales reportedly 200 per cent oversubscribed. For many, they looked more like “a structured derivative time bomb” — one that could upend financial markets if a pandemic was declared by the WHO. "
Half a billion wouldn’t upend financial markerts. So I assume we are talking about a nefarious action inspiring amount of money.
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### Author:  [@Telemark](https://boards.straightdope.com/u/Telemark)
#### Post date: [March 13, 2020, 3:06am UTC](https://boards.straightdope.com/t/who-wins-when-the-pandemic-bonds-are-triggered/849360/11 "2020-03-13T03:06:54Z")
> [@Jim\_Peebles](#):
>
> Half a billion wouldn’t upend financial markerts. So I assume we are talking about a nefarious action inspiring amount of money.
So who is talking about the trillions of dollars of derivatives? Cause this isn’t it.
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### Author:  [@Jim\_Peebles](https://boards.straightdope.com/u/Jim_Peebles)
#### Post date: [March 13, 2020, 3:27am UTC](https://boards.straightdope.com/t/who-wins-when-the-pandemic-bonds-are-triggered/849360/12 "2020-03-13T03:27:27Z")
> [@Telemark](#):
>
> So who is talking about the trillions of dollars of derivatives? Cause this isn’t it.
I can’t find an internet source for the trillions. Forget I said trillions. Look at structured derivatives upending the financial markets in the article I could find. I think that has to be in the trillions, and let’s make nailing down the exact value part of the exercise.
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### Author:  [@Exapno\_Mapcase](https://boards.straightdope.com/u/Exapno_Mapcase)
#### Post date: [March 13, 2020, 3:32am UTC](https://boards.straightdope.com/t/who-wins-when-the-pandemic-bonds-are-triggered/849360/13 "2020-03-13T03:32:53Z")
Thanks for the link. That explains everything. It’s babbling internet bullshit.
The clue lies in Alan Simpson’s use of “a structured derivative time bomb.” He clearly has no understanding of what that means and doesn’t bother to try to explain it. The quotes mean he did a quick Google search and found a scary-sounding phrase he could bash the capitalists in the head with.
I can use Google to search, too. The phrase originated in an article on Feb.25 called [Half Billion $ Pandemic Derivatives](https://www.armstrongeconomics.com/international-news/disease/half-billion-pandemic-derivatives/), written by Martin Armstrong.
Martin Armstrong is a crazy person who babbles online. Google’s [Wikipedia summary](https://en.wikipedia.org/wiki/Martin_A._Armstrong)helpfully tells us that:
> [@](#):
>
> Martin Arthur Armstrong is an American self-taught economic forecaster who uses his own computer model based on pi. He spent 11 years in jail for cheating investors out of $700 million and hiding $15 million in assets from regulators.
He’s also a climate change denier. Believe in one conspiracy theory, you believe in them all.
If you’re looking to find out why the bonds are “a structured derivative time bomb,” you’re still out of luck. Armstrong doesn’t say, and he doesn’t give a clue as to what that might mean. He never names any names or backs up any of his assertions with any evidence whatsoever. He also never gives a dollar figure for the derivatives, and neither does anyone else, so I’m assuming your fevered imagination must have conjured up those trillions. How a half billion dollars in bonds could yield trillions in derivatives might make an interesting test question at a business school, but it has no other place in reality.
Despite all that, maybe Simpson’s onto something. The pandemic bonds sound good in theory, but look at their yields, definitely in junk bond territory. And they suspiciously weren’t paid out when ebola hit Africa last year. Were they meant to enrich big money investors rather than paying out to developing countries? Quite likely.
Will doing so “upend financial markets” as Simpson says? Hell, no. First, the payment for a coronavirus virus was all of $200 million, per your earlier Wikipedia link. That’s pocket change. The world stock markets have lost more than $10,000,000 million dollars and people are concerned but not panicky.
So why the fuss? Well, there appears to be a round robin of low-end conspiracy sites of self-proclaimed experts that quote one another and make a molehill of internet bullshit into a mountain of cites. But no reputable news sources anywhere in the world that I could find soiled themselves with a quote from Martin Armstrong.
But we’ll get a chance to find out. The W.H.O. declared the pandemic after all! So the investors will lose a chunk of change. My bet is that nobody in the world will notice except for them.
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### Author:  [@jerez](https://boards.straightdope.com/u/jerez)
#### Post date: [March 13, 2020, 9:25am UTC](https://boards.straightdope.com/t/who-wins-when-the-pandemic-bonds-are-triggered/849360/14 "2020-03-13T09:25:10Z")
Sounds an awful lot like the claim in [this thread](https://boards.straightdope.com/sdmb/showthread.php?t=891294) that immune systems are strengthened by exposure to pathogens.