In need of a black swan event

[BONECRUSHER]

For what it's worth, I read an article on investing.com (too lazy to bring it up at this time) about the most crowded trade at this time...is the anti inflation trade.

Think about it...is there such a thing as a anti inflation bubble? Like Scrooge McDuck said, people are talking about it, probably not enough of them are though.

 

[Gotcha]

I know this is a trading site and not for investors in general, but I've had this recurring thought over the years about black swans, crashes, and volatility. I can understand why traders want more volatility...in many ways it's easier to make money because of more persistent trends and more breakouts...2008 was very exciting! My problem with the world being in crises mode, is how it affects so many people I know personally. I'm not too happy about the FED induced asset bubble were're all experiencing right now and how so many people are benefiting from it, but I can't help but think about my loved ones and whats coming for them. Do any of you think about the assets of your parents and grandparents when stocks, bonds, and real estate tank? If you personally don't have any long term assets...house...IRA...etc..I'm sure your parents and grandparents do. If anything, their loss is also your loss...you may be the heir to these less valued assets. I don't have a problem with markets correcting to more realistic levels or causing losses for asset holders...but I can't hope for 2008 all over again...even though it's coming!

I don't disagree with you, but at the same time, if you were sure of this, you could simply sell everything now and buy it back for half the price. So although we all know/think that there are asset bubbles everywhere, I'm not sure how many are actually doing something about it. No matter what we think or what seems logical, the "its coming" part isn't a sure thing because we cannot predict the creativity of the powers that be to keep this going for much, much longer.

So if you try and save everyone now, and some actually listen, and a year later nobody is any worse off, you're gonna look pretty stupid, and I'm sure you know this as well. Where things are heading, no matter how sure, is also dependent on timing. Being right, but getting your timing wrong, is just as bad as completely being blind to any major event.

 

[BONECRUSHER]

I don't disagree with you, but at the same time, if you were sure of this, you could simply sell everything now and buy it back for half the price. So although we all know/think that there are asset bubbles everywhere, I'm not sure how many are actually doing something about it. No matter what we think or what seems logical, the "its coming" part isn't a sure thing because we cannot predict the creativity of the powers that be to keep this going for much, much longer.

So if you try and save everyone now, and some actually listen, and a year later nobody is any worse off, you're gonna look pretty stupid, and I'm sure you know this as well. Where things are heading, no matter how sure, is also dependent on timing. Being right, but getting your timing wrong, is just as bad as completely being blind to any major event.

Excellent points! Since I don't have a crystal ball, I'm very careful about telling anyone my opinion about long term consequences...I don't expect my parents to sell all their mutual funds and I've told them that. They agree with my analyses, but we've decided that it can be very difficult to be RIGHT twice...get out before the collapse and get in before the rise...I don't want my parents and grandparents to be timing the market and watching CNBC every day! For me, and I've said this before, diversification into precious metals and agriculture is my preparation for the long term. My opinion is that a collapse will eventually happen...a flood of safe haven money into U.S. Dollar...then a U.S. Dollar crises. When will it happen? I agree with you, the powers in charge will prop things up as long as they can!

 

[K-Pia]

Otherwise there are stuffs called insurances.

 

[magicz]

insurance is for middle class drones...I go all in like Jesse L. ...go big or go home...

 

[ScroogeMcDuck]

Ya fuck it, just go 100% short UVXY

 

[newwurldmn]

Yes it's semantics.
As you said a drop is a drop.
But a 1% drop ain't a black swan.
THAT IS WHAT I HAVE NOT SAID !

If you can't profit from a drop.
Then you won't profit from a drop.
It's clear ? Nope ?! Sounds crystal clear.
THAT IS WHAT I HAVE SAID !

I am sure if I ask taleb,
He is in the green today.
Okay ? That's what it takes.
To be ... Or not to be .. long puts.
You didn't profit ? You ain't long puts !
So why will you be when the sky is blue ?!
Or how would you be suddenly profiting ?!
Today could have been a black swan !
But you didn't profit cause it wasn't.
Oh hands down. All my pardons.

Don't tell the rest of you will be ready,
Or even profit from the black swan.
Hahahahaha. The rest of you.
We're talking black swan !
XD thanks for the laugh.

You really don't know what you are taking about. Profiting from A one percent sell off has little to do with profiting from a black swan. I can be short delta and short vol such that i profit from a small move down but lose on a big move down.

Similarly you be short the market in many ways that dont involve long puts. For example you can be short risk arb spreads or you can be short dividend futures or you can be long credit protection (not a put as its bidirectional) or you can be long correlation.

 

[Sergio77]

Brexit is a pussy. Not a black swan.
A black swan is outside your schemata.
Therefore none of these "Tail Risk" is a swan.
Because they are all known unknowns.
Swans are unknown unknowns.

Right!

 

[Sergio77]

if you want to make money, instead of philosophizing about black swan events do your research on gray swan events which are far much more numerous.

Greed is the enemy of logic.

 

[magicz]

1 year after volitility is gone again......amazing!

working too hard for my 2.5 points on the ES today.....