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Thanks for the reply, Rick. I have watched that video before, and was glad to watch it again. I'm still a bit confused about how money gets created if the fractional reserve requirement is 10% of deposits. In the example in the video, the bank puts $1100 on deposit with the federal reserve...

Sorry to drag this up again, but I still need help understanding this issue. Thanks to everyone who has contributed to the thread. I started this thread by stating that I understood how money is created by the banks, but maybe I don't. In the explanation above, it appears that banks can...

I could be wrong (I often am), but I think that while debt-to-gdp was in fact higher after WW2, it is emphatically not in the low teens after having risen from the single digits. It's more like 70% of gdp (and that's ignoring the imminent social security bill). Maybe you're talking about the...

Thanks for the answers. Lots to think about.

Thanks in large part to the handful of ET posters who are actually knowledgeable and helpful, I think I understand money creation through lending, but I do not understand how wealth disappears. It's pretty obvious how a decline in an asset's value affects the owner of that asset during the...

These very long-term charts have been popping up a lot lately, but how can they possibly be valid without adjusting for inflation? Market caps inflate right along with the dollar, so it seems like the gradient would be nowhere near as steep as if you show the chart in nominal dollars. Am I...

http://bloomberg.com/markets/stocks/futures.html

Somebody please correct me where I go astray in my thinking: So this is why it's so urgent to inject capital into the banks: it's not enough to just borrow dollars from people who have them, because that doesn't enlarge the money supply. Only the banks can create money. That is to say, you...

Lots of different Ford preferreds at 20% of par, yielding 30-40%. Is the only issue here whether or not Ford goes bk, or am I missing something? Will the Paulson save aig, et al, but let gm and ford go under? f.pr.a, pij, etc.

So does this sudden less frequent success in locating shortable shares of some financial companies mean that we've all been naked shorting from time to time, i.e. even brokers for individual accounts didn't bother actually locating and borrowing shares before allowing them to be sold?

I shorted 1000 WB right before the close. I tried, but did not get any WM.

Is there some reason why USO can't be shorted? I tried to short it at the open and my broker rejected the order because the shares couldn't be borrowed. Is this just my broker?

part of the problem is that my software was recalculating time premium using the after-hours quotes. That's why it fluctuated from .7 to .55 between my first two posts. So I did a hand calculation with the last trades and the closing price, but still found a difference of about $.25, which...

Looks like it's about .54 now. I don't know if it's changed or if I miscalculated earlier. It was right after EOD so I wouldn't expect it to adjust. In any case, .54 seems like a lot, too. Shouldn't the time premium be about the same for calls and puts of equal strike prices normally? I...

Front month, all strikes...

Does anyone know why the SPY calls have around $.70 more time premium than the puts right now? Ex-dividend was last week, so there must be something else. Thanks!

Karl, how's the system doing?

I'd be willing to bet that, despite your problems with clickfraud, you still buy adwords. I forget the exact amount, but our clickfraud rates were so bad and so obvious (I imagine the fraud sweatshops in India have figured out IP spoofing by now, but they didn't bother a few years ago), that we...

It is human nature to become vindictive when one feels slighted by the unwarranted success of others. Vindictiveness, is, however, a poor investment or trading strategy. Google's success has nothing to do with "javascript webmail" (and I am a "computer scientist" as well, bfd). It has...

HoundDog, that's an interesting assertion you make. Can you expand upon it? I've been thinking a lot lately about the nature of "directional bets", and your assertion regarding the randomness of the system resonates, but do you really believe that the only way to make money is to speculate...