TheDeepBlueSea Posted March 21, 2003 Report Share Posted March 21, 2003 "Fed has practically unlimited resources to put a floor on the market" They have 124 resource points left from an available supply of 1,908 when the survival of the floating exchange rate system reached it's maximum potential for debt inflation which depended on interest rates to keep going up forever. Since the maximum potential for debt inflation by raising interest rates was impossible, now we are in the final or terminal stage of the floating exchange rate system which depends on interest rates going lower forever... but they can't so the maximum potential will be reached within 12 -16 months... Terminal? Yes, if you were to raise interest rates the system implodes in the blink of an eye... Interest rates will go down to the flat line stage and go Beeeeeeeeeeeeeeeeeee... Think of the banks as the brain and debt as oxygen and lowering interest rates as a heart that is beating slower and slower until it stops beating... Think of the FED's repo blasts as the trauma team trying to desprately shock the system back to life... The economy is the rest of the vital organs. And they are shutting down... Rising interest rates is the doctor's bill for the failed attempt at reviving your loved one and you have no way to pay it so you will have to declare bankruptcy.... How many months left until your scenario plays out? Link to comment Share on other sites More sharing options...
Goldmember Posted March 21, 2003 Report Share Posted March 21, 2003 I had another look at this chart. There is a distinct opposite corelation with high beta Nascrap stocks. When the high betas are getting slaughtered in the market this stock appears to behave as a safe haven refuge. When the Nascrap high betas fly, like recently, this diamond company sells off as the money chases the high beta. Almost like a Treasury yield in some strange sense. So this looks like a safe short when the high betas are flying and a safe haven when the high betas sell off, except during extreme high fear when everything sells off, like last June and July and October. Just thought I would point that out. Link to comment Share on other sites More sharing options...
Guest BEARDRECH Posted March 21, 2003 Report Share Posted March 21, 2003 Doc, It is true about the cult stocks, but why are we all so drawn to these? These supermodels are so tempting, but I always get burned everytime I tough one. hmmm.....but I keep coming back for more. I am learning my lessons and keeping my distances. With every mistake, I learn---Hopefully it is not an expensive lesson. Oilman because unlike PILES many of us are unwilling to shop at Goodwill industries,which by the way is,i think a fabulous longiedongie bdrech Link to comment Share on other sites More sharing options...
Guest BEARDRECH Posted March 21, 2003 Report Share Posted March 21, 2003 Swee -thanks for those charts-them are KEEPERS! Note the close on the p/c ratio .56 every one thats wants to be long is-now they get to have a religous experience without going to church-Trade Safe! Hey Vets-don't you wish that every one of these yappy imbedded, would be war correspondents was on the point-I DO! even patton wore his a's to the front;ww2 cartoonist MAULDIN had a lovely cartoon feuturing drunken journalists pretending to be battlehardened veterans on r & r-i forget the caption----Ted Kopple,donned in the gay apparel of desert fatigues, looked like a mannequin in an army surplus store-- The silly journalistic twits ,in many cases,woman twits,that is woman without tits, have all of the alluring qualities of a sideshow barker at a carnival-- bdrech Link to comment Share on other sites More sharing options...
Bearman Posted March 21, 2003 Report Share Posted March 21, 2003 S-pee mini up 9.25 selling more Link to comment Share on other sites More sharing options...
Bearman Posted March 21, 2003 Report Share Posted March 21, 2003 europe buying like the wars a done deal the real problems start on the rebuild Iraq Link to comment Share on other sites More sharing options...
Guest Posted March 21, 2003 Report Share Posted March 21, 2003 You buy $1000 worth of a 200% bear fund on Monday at the close. The market rises 25% on Tuesday. Your investment is now worth $1000 - $1000(.25 x2)= $1000- $500 = $500. Now on Wednesday the Market goes right back up 25% to where you started on Monday night. Your account is worth $500 + $500(.25x2)= $500 + $250 = $750. The market is exactly where you were when you bought in, but you're now down 25%. Your math is wrong; in reality it's even worse than that. Suppose that the market was at 1000 when you invested $1000 on Monday. It goes up 25% on Tuesday, so your investment is now worth, as you say, only $1000 - $1000 * (25% * 2) = $1000 - $500 = $500 The market itself is at 1250. However, on Wednesday the market needs to fall only 20% in order to get back to 1000, where it was on Monday. (It needs to fall 250 points - but that's only 20% of 1250.) Then your investment becomes $500 + $500 * (20% * 2) = $500 + $200 = $700 So, in reality the market went nowhere but you're down 30% on your initial investment. Oh, and Doc and everybody: THIS IS NOT "SLIPPAGE". Slippage is something different. Slippage is when the price is at 10, you enter an order to buy at market - but your order is filled at 11, because meanwhile the market has moved up. The effect we're discussing here is not slippage; it is a simple mathematical consequence from the fact that the leveraged funds mirror twice the daily movement of the underlying - not twice the longer-term movement of it. Regards, Vesselin Link to comment Share on other sites More sharing options...
Guest Posted March 21, 2003 Report Share Posted March 21, 2003 With personal bankruptcies soaring in the US and a new, more stringent, bankrupcy law in the work it's interesting how differently bankruptcy is viewed in Japan, the world's 2nd largest economy. Bankruptcy in Japan People in Bankruptcy shouldn't lose their head Sorry looks like there's some trick at the JapanTimes site to prevent linking. There's nothing of the sort - simply you've put one "http" too many. Correct link: Bancrupcy in Japan Regards, Vesselin Link to comment Share on other sites More sharing options...
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