The Darkest Storm is About to Descend - You Can't Imagine the Carnage
- Thread starter ByLoSellHi
- Start date
thanks,
and it had the visuals and the links too, that was especially good, because previously, the online articles would go without any pictures from the print copy
either way, its required reading, and oh, yeah, Limitdown is a shared handle among a few key traders, so from time to time, different perspectives will be given on the same or varied topics (disclaimer)
Truth is that none of us know what is going to happen. What rabbit will Paulson Bernanke Dodd/Frank SEC pull out of the hat next? I think a straddle of sorts make sense here and am long ES and NQ calls, USO calls, and QID/SKF OTM calls in case the market actually starts to care about all the bad news again and the minders run out of options/ammo (very unlikley any time soon).
Anyone paying attention to ABK/MBI today?
Anyone paying attention to ABK/MBI today?
Posted before, but well worth another post so those who haven't read it, can:
James Quinn is senior director of strategic planning, the Wharton School of Business, University of Pennsylvania.:
http://seekingalpha.com/article/8872...st_popular_box
James Quinn is senior director of strategic planning, the Wharton School of Business, University of Pennsylvania.:
http://seekingalpha.com/article/8872...st_popular_box
Some A-list name in the last few days on CNBC and from the Financial Times have said:
[I quote where possible, paraphrase in part b/c I DVR'D CNBC and took written notes, not exact quotes.]
Bill Seidman who headed the RTC during the 90-91 Savings and Loan debacle:
"the Federal Reserve's latest power grab is dangerous because everything they are doing is inflationary and exactly the opposite of their mandate" (They are of course supposed to fight inflation)."
Paul McCully of PIMCO, guest hosting Squawk Box Jul 31:
Expects another 10% on average down move on housing and an L-shaped recovery thereafter. In CA in 90-91, housing took 5 years to start real appreciation again. This time things are worse.
The most interesting line up I've seen in a while was this morning on CNBC where you had Meredith Withman of Oppenheimer, the bank analyst now called the most influential on the street along with Larry Summers. This was followed by Nouriel Roubini, the NYU economics professor who was doomsday bearish and so far largely right.
Meredith and Summers agree on this very scary point. Uninsured bank deposits i.e those greater than $100K per person/account are the next "iceberg" risk. Summers says that many businesses keep cash on hand for payroll way in excess of this $100K threshold. A single decent sized bankruptcy is all we need to cause a run on the banking system. This despite the fact, as Summers points out that the FDIC fund can be replenished way beyond its puny $54 billion with the stroke of a pen - that doesn't do it he says.
Summers says the housing bill leaves Fannie and Freddie mostly intact which is very much a page taken out of the Japanese playbook at the star of their 15 year deflation period hell which starte circa 1990. Keepimg them intact is (Summers says) an unwillingness to fix the institutions. The should be split up, privatized and downsized. Congress says NO!
I'll spare you on Roubini's comments, he's upping his armaggedon ante even more than what he said in the Barrons article this weekend (read it!).
In short, the smart money are screaming from the rooftops.
[I quote where possible, paraphrase in part b/c I DVR'D CNBC and took written notes, not exact quotes.]
Bill Seidman who headed the RTC during the 90-91 Savings and Loan debacle:
"the Federal Reserve's latest power grab is dangerous because everything they are doing is inflationary and exactly the opposite of their mandate" (They are of course supposed to fight inflation)."
Paul McCully of PIMCO, guest hosting Squawk Box Jul 31:
Expects another 10% on average down move on housing and an L-shaped recovery thereafter. In CA in 90-91, housing took 5 years to start real appreciation again. This time things are worse.
The most interesting line up I've seen in a while was this morning on CNBC where you had Meredith Withman of Oppenheimer, the bank analyst now called the most influential on the street along with Larry Summers. This was followed by Nouriel Roubini, the NYU economics professor who was doomsday bearish and so far largely right.
Meredith and Summers agree on this very scary point. Uninsured bank deposits i.e those greater than $100K per person/account are the next "iceberg" risk. Summers says that many businesses keep cash on hand for payroll way in excess of this $100K threshold. A single decent sized bankruptcy is all we need to cause a run on the banking system. This despite the fact, as Summers points out that the FDIC fund can be replenished way beyond its puny $54 billion with the stroke of a pen - that doesn't do it he says.
Summers says the housing bill leaves Fannie and Freddie mostly intact which is very much a page taken out of the Japanese playbook at the star of their 15 year deflation period hell which starte circa 1990. Keepimg them intact is (Summers says) an unwillingness to fix the institutions. The should be split up, privatized and downsized. Congress says NO!
I'll spare you on Roubini's comments, he's upping his armaggedon ante even more than what he said in the Barrons article this weekend (read it!).
In short, the smart money are screaming from the rooftops.
The Darkest Storm is About to Descend - You Can't Imagine the Carnage
Yah, yah, blah, blah. Sadly, you probably missed the carnage that's been happening for the last 12 months and still counting. It ain't so much about when it's going to happen as much as when it will happen in my otherwise not so humble opinion. BTW my mama once taught me timing is everything!
Yah, yah, blah, blah. Sadly, you probably missed the carnage that's been happening for the last 12 months and still counting. It ain't so much about when it's going to happen as much as when it will happen in my otherwise not so humble opinion. BTW my mama once taught me timing is everything!
You're a market timer, huh?
That's cool, if it's working for you. You think the worst is over? Buy up the banks and financials right now if you do. Buy them buy the boatload and don't look back.
That has worked pretty well the last couple of weeks.
My question is this - what is the recommended investment position if you agree with the doomsday crowd? Obviously you can't be in equities. Or bonds. Or cash. That leaves commodities and TIPS. Last time I checked, both are in bearish trends and have been massacred over the last 3 weeks.
Don't listen to permabears anymore than you would permabulls. Be a trader, not a pundit.
I know. This is where one really does have to have balls, and an inherent belief that regulators such as central banks will do the right thing, or at least not compound the problems, during times of crisis, in order to summon the nerve to enter a position.
My problem now lies in lack of faith in our central bank.