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Well, I know the Federal Reserve Act, which is the law that the Fed is purportedly violating. And no, he doesn't have to be wrong and I have read his letter carefully. The problem is that his claims aren't based on any specific legal references.

Yes, that means next hike in June or July, which is pretty much what was expected.

Well, this is my problem, you see... As long as we're talking counterfactuals, why do you presume that the CB influence is overwhelming? In the presence of other factors, how can you be sure that it's mostly the CBs that are causing these distortions? How can we be sure that it's not the...

Whatever the argument he's making, he cites no actual letter of the law that the Fed is supposedly breaking. There is nothing in the Federal Reserve Act that lends any credibility to his claim.

Yes, so you're saying that in a theoretical, fully deregulated mkt that is completely free of all govt intervention (that includes taxes, tariffs, exchange rate controls, etc), the mkt is always right. To be sure, barter won't necessarily be fully free, according to your definition, and neither...

Isn't the most important contemporary economic success story all about the central govt planners getting it right? I mean, of course, Deng Xiaoping and China... [B] What do you mean by this? Wasn't it the mkt that was valuing subprime RMBS at par in 06/07? Was it right then?

Sure thing, I understand... Doesn't make it any less wrong, though.

Excellent... Now, much as I appreciate the sarcasm (and I do, believe me, I do), don't you think that using the word "guarantee" in this statement: - "the minimum guarantee would be that members net 500 pips pm following my trades" is a bit - how do I say it - misleading? At any rate...

This is incorrect...

I'd like to clarify a point about this guarantee... If I lose money (say, based on monthly PNL) as a result of your most awesome signals, are you going to pay me to fully cover those losses? Or is this guarantee applicable only to the subscription fee? From my perspective, one's long an...

They were, before EUR HICP printed at 2.6% YoY... They ain't saying that no more. In fact, the leaks are suggesting that they're now saying that this is, in fact, a start of a cycle. EONIA mkt is pricing in a wee bit more than 3 rate hikes by end of 2011 (this is a very rough and approximate...

Erm, I wouldn't really be so sure about this, as far as the ECB is concerned.

Well, we're gonna have to agree to disagree on this one then.

No, it's nothing like that. It's a lot simpler and is just a matter of history and precendent, is all.

This is a very disingenuous argument the guy's making.

Dude, it's a bit of a squeeze. Treasury GC is trading at 0 and there are bonds (3yrs) trading at -3%. I think the new equilibrium in FF shouldn't be too much lower than here, tbh, but at the moment it's all one way.

Well, firstly, I am not talking about dynamically hedging it. Secondly, yes, there is pin risk, but again this is a portfolio held to maturity. It's not that hard. [B] Well, I don't know... I would agree, but only to a point, since I think generalizations are rather pointless. [B] Well...

Again, it's just a matter of hedging the delta at the short strike (or at the midpoint), if it ever gets there. As to the payout on the call spreads vs the calls, yes, you're sacrificing larger upside, but if you're able to buy the call spreads much cheaper due to skew, the payout might be...

This doesn't make sense to me. How can a call spread be effectively short a put? How can a call spread be short gamma? Finally, isn't being short a put a good position in an extended bull mkt? Moreover, if he's through his short strike and not happy unwinding the call spreads for some...

Well, it's all on the back of the previous FDIC decision to include the reserve deposits held at the Fed when calculating the insurance fee. The new rules went into effect today. Either the set of exempt assets/institutions was smaller than people expected or people didn't expect it at all...