Global Macro Trading Journal

Quote from Debaser82:
I have a question that might sound very stupid but I'll ask it anyway.

So the Swiss were going to peg the CHF at 1.20 Euro's right.....

I believe it was at 1.10 the day before.

They wanted X to be at level Y and they managed to get it there.


Why not use the same method on whatever X could be and inform in advance who ever you want informed (say the banks) so they can play it for maximum gain and hit it big.

Ofcourse the losses would have to be contained to as there are 2 sides to every trade but in theory hundreds of billions could be made this way rather then accumulationg them through capital injections or saved by austerity no....

As I said I know it sounds stupid but what am I missing...

Maybe the moral hazard or even legality of it and the idea of giving up free markets in the clear open but really is that even still an issue these days...
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And what happens if, god forbid, people find out?
 
Quote from Debaser82:

Is a retest of the 09 lows a possibility or is that too much? Can the system take global banking stocks trading at penny stock levels again?
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US Financials are about 13% of the SP500 right now. That's from 20+% during the 2004-2007 leverage bubble years. The historical average is closer to 10-12% so yes, over time the financial system can digest the banks and financial industry shrinking relative to the indexes.

I believe over the years more financial companies including banks will shrink, be bought out or otherwise disappear.
 
Quote from Butterball:
US Financials are about 13% of the SP500 right now. That's from 20+% during the 2004-2007 leverage bubble years. The historical average is closer to 10-12% so yes, over time the financial system can digest the banks and financial industry shrinking relative to the indexes.

I believe over the years more financial companies including banks will shrink, be bought out or otherwise disappear.
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+1
 
Quote from Debaser82:

I have a question that might sound very stupid but I'll ask it anyway.

So the Swiss were going to peg the CHF at 1.20 Euro's right.....

I believe it was at 1.10 the day before.

They wanted X to be at level Y and they managed to get it there.


Why not use the same method on whatever X could be and inform in advance who ever you want informed (say the banks) so they can play it for maximum gain and hit it big.

Ofcourse the losses would have to be contained to as there are 2 sides to every trade but in theory hundreds of billions could be made this way rather then accumulationg them through capital injections or saved by austerity no....

As I said I know it sounds stupid but what am I missing...

Maybe the moral hazard or even legality of it and the idea of giving up free markets in the clear open but really is that even still an issue these days...
More...

There are political considerations in case they are found out/caught. Some people claim they already do this, M Whitney said that in 2009 the Fed did that in QE1 by buying MBSs, propping their price when the banks owned a lot of it. She called a backdoor capital injection or something like that
 
Quote from ralph00:

Ackman interview. Starts on HKD around at about 13 minutes.

http://www.bloomberg.com/video/77004990/
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He didn't say anything new. The trade is a good one but I don't see how its a favorite to work, the downturn is close both in China and HK, tightening policy now would be getting the worst of both words(the boom/bubble and a hardlanding). They will be forced to keep policy loose in the hopes that will produce a soft landing

Tightening will also put the blame of breaking the bubble on them, still, the odds are just too good to pass
 
Quote from Daal:

Just covered 50% of my HK stocks shorts at a decent profit. They have been beaten down a lot lately. Might be due for a bounce.
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Good job, Daal.

Do you short HK stocks through IB? Presumably, only the large cap stocks - HSI constituents - are available?

Thanks.
 
Quote from rsi80:

Good job, Daal.

Do you short HK stocks through IB? Presumably, only the large cap stocks - HSI constituents - are available?

Thanks.
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EWH. More than 50% of the stocks are financial/real estate related
 
Just bought a bunch of calls in FAS, XLF, BAC. With all the folks who blew it in 2008, now calling for a repeat, some cheap OOM call options on financials could pay off handsomely. Also a nice hedge to my short AUD, though I'm barely short at the moment.
 
Freudian typo, Fed email version?

"New York Fed purchases $8.870 billion in Treasury coupons"
"CORRECTION: New York Fed sells $8.870 billion in Treasury coupons"

:p
 
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