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I'm sorry, this logic doesn't work for me. If I say something stupid and wrong, I can't turn around and claim that, oops, I didn't really mean to say it, but only meant to introduce a topic for discussion. [B] Agreed, we all want to know answers to these questions... We all want to come up...

How much US govt debt is monetized by the Fed as a proportion of the total US govt debt, do you know? Has the Fed always monetized US govt's debt? [B] Really? You don't say?! I'm scandalized! Banks borrowing money from the Federal Reserve! What's the world coming to? What's next? Britney...

Feel free to end what you gotta end, amico. I will cry only a bit, since this debate is so infinitely special to me, but I think I'll live. Again, it doesn't matter what you call the form of government that is currently in operation in the US. Let's call it X to avoid snags. I am saying...

You're wrong, TZ... You have to realize that the EuroZone has been a dream of several generations of Germans (and the French, to a lesser extent). Whether it's the result of post-WWII trauma or something else doesn't matter, but the Germans and the French are prepared to "help" Greece...

When did I ever say that the function of the Federal Reserve isn't the issue of money? If you want to read more about what the Fed does, you will find it on the very first page of this document: http://www.federalreserve.gov/pf/pdf/pf_1.pdf Likewise, when did I ever suggest that US taxpayers...

'Cause they cannot afford to... Spain's fiscal deficit was running at 11.4% in 2009, when things were looking sort of OK. If you then add EUR 300bn to gross national debt, debt to GDP will be at arnd 71%, which is not too bad. However, the Spanish economy is on its knees and, in contrast to...

This is absolutely PRICELESS!!!! I will reveal to you why more people don't talk about it... It's because people, for the most part, are not idiots. They know that debt is issued by the US Treasury, rather than the Federal Reserve. Most people also know that a very large portion of US govt...

Disagree... One reason would be to lower borrowing costs during normal mkt conditions (which, I guess, is a form of fiscal backing). Greece certainly got that benefit, but squandered it all away, in contrast to, say, Italy. Arguably, if there was a way, they should be forced to stay in...

In Spain's case, current national debt is not the issue... It's the writedowns that the Spanish banking system still has to take on various loans to property developers that are looking increasingly, shall we say, unpleasant. EUR 8bn ain't gonna do the trick, not even close. The actual...

The problem with shorts based on the LIBOR blowout logic is that LIBOR is largely political. It's not a mkt rate any more, which means that it can be artificially suppressed, while the sovereigns topple.

I like these guys, 'cause they were responsible for some absolutely stunning violin music... Ysaÿe, Sarasate and Chausson.

Sure, so it's just because it's a nifty acronym... But that would imply that there zero value in his actual index and the charts of it. 'Cause, by way of an example, Denmark and Turkey sov CDS have moved in the opposite direction relative to Italy and Portugal.

I am not really sure what ZH's index is based on, although I'd assume it's 5y sovereign CDS. There's really no need for it, as there's something already. Specifically, the SovX series of indices. They are tradable and are used by everyone in the mkt. Besides, why the heck you'd bundle...

The bid-to-cover ratio is meaningless... The bond was absolutely spanked going into the auction, so it's not surprising to see cheeky low bids galore. After all, remember the Greek 5y auction the other day? Lots of bids (5x b/c, based on their original intentions), but we all know what...

Yep, one of the chapters in filthy's book, in fact, covers Zakamouline's methods in some detail...

I didn't call it a "filthy book". It's "filthy's book", because the author is known as 'filthy' to the quant community.

Ophir, I'd like to say just one thing... You guys are posting some good stuff. If I were involved in equity options, I think I would find your ideas and general mkt color valuable.

I am sure you know it... Here: http://www.amazon.com/Volatility-Trading-CD-ROM-Wiley/dp/0470181990/ref=sr_1_1?ie=UTF8&s=books&qid=1265133684&sr=8-1

Maybe, maybe not... filthy's book covers some of these issues in a reasonably sensible way. I'm sure there's also other material written by the usual suspects.

KK is 100% correct. The article quoted is mostly nonsense.