You're saying banks wrote a boatload of puts, and their downside exposure is ~50 Trillion?
What are the strikes relative to housing prices now?
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My way of fighting the fed, I cannot sit still anymore
- Thread starter PAPA ROACH
- Start date
You're saying banks wrote a boatload of puts, and their downside exposure is ~50 Trillion?
What are the strikes relative to housing prices now?
Quote from achilles28:
You're saying banks wrote a boatload of puts, and their downside exposure is ~50 Trillion?
What are the strikes relative to housing prices now?
I don't know what makes up the $50 Trillion. I only use that number because I have read about various amounts ranging from $50 Trillion to $250 Trillion. Most of this stuff is off balance sheet and not traded electronically so no one really knows.
Greenspan talked about directives and counterparty risks various times in testimony to Congress. It was a big concern of his.
Everything ends up in the Banks sooner or later which is why I say the banking system is the counterparty.
I don't know how they relate to housing prices.
Here is so info on it that I just came across searching on the internet.
http://www.investorsinsight.com/otb_va_print.aspx?EditionID=619
John
Thanks, jficquette.
I'll take a good look.
I'll take a good look.
Wrong, it is about the supplemenation of iffy collateral with bad collateral to increase the credit supply.
Also, credit creation is NOT the basis for economic growth... it is the basis for increasing the money supply.
Also, credit creation is NOT the basis for economic growth... it is the basis for increasing the money supply.
Quote from Landis82:
You still don't get it.
It's NOT about rate cuts!
If it was, the FED would have lowered FED FUNDS to below the yield on the 2-year Treasury Note by now. That's basic Econ. 101A which you obviously must have missed.
Moreover, yesterday's action by the FED also has nothing to do with rate cuts, doesn't it? It's about replacing bad collateral with good collateral so that credit creation can get going again. That is the basis for economic growth.
Quote from PAPA ROACH:
Here is a letter I sent to my Congressman today. I cannot just sit still and not do something. Will it help in any way? Who knows, but doing nothing at all certainly won't do shit. If anyone agrees with what I have written, feel free to copy and paste a letter to your own Congressman. Who knows, if we all pile in letters like this, we may have an impact. Otherwise, sit still and watch your country deteriorate further.
I write to you today to discuss my concerns for the sad state our country is in, economically speaking. We are changing, from a great superpower of capitalism, to a third-world socialist state under the current administration.
Alan Greenspan spent many years toying with bubbles and balancing the economy, always attempting to manipulate and avoid the natural capitalist economic cycle. Before his departure, he reduced rates and held them at rediculously low levels for far too long, thus creating a major liquidity bubble that we are currently battling in commodities.
Ben Bernanke has decided to attempt socialism, by taking our hard earned money to bail out the very thieves on Wall Street that have put this country at risk to begin with. These continued rate cuts are clearly causing extreme harm to America in the form of run-away inflation, that we are all paying dearly for. The pace of inflation is grossly outrunning income and is a much larger threat for a systemic meltdown of the economy, than just letting the market cleanse itself in the way that capitalism is designed for.
I applaude Jean-Claude Trichet of the EU, for sticking with the mandate of price control, and choosing to battle inflation. The FED has clearly lost its way, and is threatening our future and my childrens future.
I plead with you, that you and your peers take action and demand that the FED return to mandate of fighting inflation. There is a FOMC meeting next week where the rates will likely be cut further. This is not and has not helped comsumers in any way. I fear what will happen to the dollar if Mr. Bernanke indeed cuts rates again.
As I write this letter, Oil is trading over $110 per barrel, wheat over $13, and the list goes on and on. Gasoline stockpiles in the US are currently at the highest levels in over 15 years, yet we are paying over $3 at the pump. This has been accomplished on only an 85% utilization in refining. Bottom line, this is a problem of the dollar the the FED is destroying, not a true supply/demand imbalance.
Please stop further rate cuts.
Sincerely,
Don't fight the Feds. Its no use. They own you and your grand parents destiny!
Quote from Aaron Copland:
Can I copy this and send it to my congressman?
You think your wimpy starch collared Congressman can fight the Chairman of Federal Reserve Bank? LOL!
They report to nobody, not even the President of United States. They own your balls and they own all the money in this country!
Quote from PAPA ROACH:
Here is a letter I sent to my Congressman today. I cannot just sit still and not do something. Will it help in any way? Who knows, but doing nothing at all certainly won't do shit. If anyone agrees with what I have written, feel free to copy and paste a letter to your own Congressman. Who knows, if we all pile in letters like this, we may have an impact. Otherwise, sit still and watch your country deteriorate further.
I write to you today to discuss my concerns for the sad state our country is in, economically speaking. We are changing, from a great superpower of capitalism, to a third-world socialist state under the current administration.
Alan Greenspan spent many years toying with bubbles and balancing the economy, always attempting to manipulate and avoid the natural capitalist economic cycle. Before his departure, he reduced rates and held them at rediculously low levels for far too long, thus creating a major liquidity bubble that we are currently battling in commodities.
Ben Bernanke has decided to attempt socialism, by taking our hard earned money to bail out the very thieves on Wall Street that have put this country at risk to begin with. These continued rate cuts are clearly causing extreme harm to America in the form of run-away inflation, that we are all paying dearly for. The pace of inflation is grossly outrunning income and is a much larger threat for a systemic meltdown of the economy, than just letting the market cleanse itself in the way that capitalism is designed for.
I applaude Jean-Claude Trichet of the EU, for sticking with the mandate of price control, and choosing to battle inflation. The FED has clearly lost its way, and is threatening our future and my childrens future.
I plead with you, that you and your peers take action and demand that the FED return to mandate of fighting inflation. There is a FOMC meeting next week where the rates will likely be cut further. This is not and has not helped comsumers in any way. I fear what will happen to the dollar if Mr. Bernanke indeed cuts rates again.
As I write this letter, Oil is trading over $110 per barrel, wheat over $13, and the list goes on and on. Gasoline stockpiles in the US are currently at the highest levels in over 15 years, yet we are paying over $3 at the pump. This has been accomplished on only an 85% utilization in refining. Bottom line, this is a problem of the dollar the the FED is destroying, not a true supply/demand imbalance.
Please stop further rate cuts.
Sincerely,
Don Quixote charged at the windmills ...you too can do it!
Quote from makloda:
Landis, let's go help the middle class. I say let's raise rates not to 6% but to 12% overnight so oil and grains come down, after all everybody is talking about inflation here! The dollar would bounce, inflation talk would disappear from headlines and the banking system would go into a systemic meltdown and unemployment would soar to 15%. What a great scenario for the middle class!
TRANSLATION: I want the stock market to keep going down so I can short at every opportunity and scalp nickles and dimes and buy myself Jim Beam and fall asleep on my cheap linoleum floor.
Quote from timscott:
I actually emailed the Federal Reserve today before I saw this post.
Everyone should let them know what we think. Killing the dollar might save the banks but it's going to kill us - the consumer.
TRANSLATION: IF feds do not cut rates, market will keep going down and I can keep shorting at every opportunity enough to buy a pint of Jim Beam and waste myself on the cheap linoleum floor.