Skip to main content
Urban Dictionary Merch
Your favorite words on things you can wear, drink from, read, or give to a friend.
The Urban Dictionary Store sells gifts you’ll have to explain.

credit default swap

(FINANCE) financial instrument in which buyer is someone who needs insurance against the possibility that a borrower will default on a loan. In that case, the counterparty is whoever receives the CDS premiums, and pays out in the event of default.

WHY IT'S BAD
Loans are usually made by either commercial banks (in which a loan officer is supposed to make a professional assessment of risk of default before handing over the money), or by investment banks (which underwrite securities like bonds). If the borrower has a high risk of default, then the loan should not be made--period.

Credit default swaps were a stupid method of supposedly turning a bad loan into a "risky" (and potentially high-yield) "investment"; they were in reality a strategy for fraud. Since portfolio managers knew they were bundling securitized loans that contained mostly crap, they would arrange credit default swaps and cash in when the borrowers defaulted.
What the bankers hit on was a sort of insurance policy: a third party would assume the risk of the debt going sour, and in exchange would receive regular payments from the bank, similar to insurance premiums. JPMorgan would then get to remove the risk from its books and free up the reserves. The scheme was called a "credit default swap," and it was a twist on something bankers had been doing for a while to hedge against fluctuations in interest rates and commodity prices.

{Newsweek, "The Monster That Ate Wall Street," 27 Sep 2008}
Related Words

default dinner

The what to eat decision made for evening meal, usually when out of food.
Damn, the folks are coming over...mac n cheese default dinner? Maybe with hot dog chunks?

Nothing to eat kids. Can smell Jim's grill, though. Sneak over for default dinner.
default dinner by msdee January 5, 2017

DEFACTOID 

DEFACTOID:- A person, animal or device which is mainly used to commit activities to reduce or demolish the activities of the opposition.
Don't waste your time planning to finish him off, get DEFACTOID on it - defact him fast!
DEFACTOID by 1STFABARM May 1, 2019
An outrageously powerful slap delivered into the ear by the inside of one's bare palm. A loud slap is heard from across the room and the victim is usually left temporarily deaf, hence the name. The slap is preferably delivered after administering a droplet of spit into the palm and without the victim seeing it coming. It can be used as a verb in all tenses.
Noun: Ron Artest just gave that fan a mean deafazz.

Verb: Keep talking that smack and you'll get deafazzed.

smack, thump, slap, bitch-slap, bitchslap

Default face

The look on somebody's face when they're just sitting there thinking or are doing nothing & have no other emotions. The a way a person's face naturally falls.
Everybody kept asking me if I was sad today! But, nobody understands that it's just my default face. I've just been zoned out lately.

Dude: Hey, is Shauna pissed off?
Dude 2: Nah, dude, that's just her default face.
Default face by heylobster September 1, 2009

default dinner

The what to eat decision made for evening meal, usually when out of food.
Damn, the folks are coming over...mac n cheese default dinner? Maybe with hot dog chunks?

Nothing to eat kids. Can smell Jim's grill, though. Sneak over for default dinner.
default dinner by msdee January 5, 2017
More from Urban Dictionary

Oblication 

A vacation, feeling more like an obligation, that involves visiting or staying with family.
So Joe where are you taking the kids for spring break vacation? We are going on an oblication to Boca to visit my mother-in-law.
Oblication by kimmerr May 5, 2011
Word of the Day on October 25, 2026

Surf Dracula Syndrome 

A phenomenon in film/television series, most notably streaming series, where the main premise is drawn out to such a point that it takes an entire season or more to get the parts of the series the audience is actually interested in seeing.

For example, if a series is titled "Surf Dracula," a majority of viewers would tune in expecting to see Dracula surfing by the first or second episode. However, the entire first season would instead be tedious padding and backstory before finally ending with Dracula surfing in the last five minutes of the season finale.
I watched "Smallville" on Netflix the other day. Dude, it was ten seasons of filler before he finally flew! Major Surf Dracula Syndrome!
Word of the Day on October 24, 2026

Northstarring

Finding your way back to the truth by fixing on one verified fact and working out from there, the way you navigate by the North Star when everything around you is spinning.
Rumours were flying everywhere, so she went northstarring — one checked fact at a time.
Northstarring by Light Bearer October 22, 2026
Word of the Day on October 23, 2026

Plate of Brown 

A plate of brown consists of foods that have little to no nutritional value, and are typically deep fried. A true plate of brown will also be accompanied by a dark soda.
Wanna go to meal hall & grab a plate of brown?
Plate of Brown by Cheddar Craigson September 18, 2020
Word of the Day on October 22, 2026

Larpenomics

When finance content creators rent out fancy cars and flex cash to seem richer than they really are in order to promote and sell their “get rich quick” courses.
Andrew Tate has mastered the field of larpenomics
Larpenomics by Rbois09 October 21, 2026
Word of the Day on October 21, 2026

Palmela Handerson 

Your hand that you masturbate with.
Girlfriend: What are you going to do for the next week while I'm on holiday?

Boyfriend: Have a visit from Palmela Handerson of course!
Word of the Day on October 20, 2026
Load more