The Future of Futures?

T

tommo

It seems to me there has been a huge shift in public opinion in the fallout of the financial crisis. I am from the UK and there has always been an attitude of championing the underdog and laughing at the people at the top of their game. I always admired the US where success was congratulated. But it seems now even you are getting infected by this attitude whereby all the successful people must have cheated in some way.

This obviously leads to people turning their guns towards traders and it seems to me they are getting their way. I have been a professional trader for 6 years and the markets seem like they have had the life sucked out of them. Regulation is killing off so many prop desks, retail investors are scared to get involved. Volumes on a lot of contracts are falling off a cliff. Its like there is nobody left in the game.

Normally this wouldnt bother me too much as these things move in cycles, but the unwinding of this current situation could be so violent i cant see the central banks letting that happen. And if the markets are left to rebalance on their own it will be us traders again that get it in the neck for capitalizing on the moves!

How do you see this playing out?
 
Quote from tommo:

It seems to me there has been a huge shift in public opinion in the fallout of the financial crisis. I am from the UK and there has always been an attitude of championing the underdog and laughing at the people at the top of their game. I always admired the US where success was congratulated. But it seems now even you are getting infected by this attitude whereby all the successful people must have cheated in some way.

This obviously leads to people turning their guns towards traders and it seems to me they are getting their way. I have been a professional trader for 6 years and the markets seem like they have had the life sucked out of them. Regulation is killing off so many prop desks, retail investors are scared to get involved. Volumes on a lot of contracts are falling off a cliff. Its like there is nobody left in the game.

Normally this wouldnt bother me too much as these things move in cycles, but the unwinding of this current situation could be so violent i cant see the central banks letting that happen. And if the markets are left to rebalance on their own it will be us traders again that get it in the neck for capitalizing on the moves!

How do you see this playing out?
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The markets have had their life sucked out of them. I feel like making the post you made every single day to this forum, but don't since it would be mostly unproductive and eventually turn into some troll thread.

I ask myself the question: What would bring volume back? And there's nothing on the horizon that suggests the volume is coming back. I actually think the only way things will really come back is if they stop intervening in the markets and just let them fall gradually to very low levels.

The worst part for me is: Say my edge dies and say I wanted to go back to a real job, as a programmer or whatever. If I went back into the industry as an employee, there aren't very many places that are hiring that would pay enough to make it worth being an employee. That's because the industry itself is hurting, bonuses are going to fall, and the prop firms don't want to be on the hook for a very high salary. So even the conventional wisdom on ET about going to get a job first doesn't seem to make sense, at least not at this time.
 
What you say tommo makes alot of sense, and I agree with it. But for me it's all about the look of the intra-day charts, and for now at least things still seem ok, if not maybe even better than usual. The EUR/USD is a little dead now, which may be your main instrument (?), but the U.S. indices are moving again and I feel that's a good sign. True, the volume's down but personally I'm not swinging 300 lots so it doesn't affect me all that much.

My biggest fear is seeing the markets devolve into a state where they linger in a tight range around one price for hours making many tiny false breakouts, then suddenly shoot out one side for one bar and that's it for the day. That's when I'll know the markets are finished, or at least I am. Until then, I think there are still opportunities - and there'll probably still be opportunities on longer time frames in some markets even if the scenario I described should develop.
 
The FTT that the europe socialists are trying to push through will kill off all traders. Sad that the USA is turning into europe (politically).

Scary times IMO.
 
Im glad other people share my frustrations.

Personally i am a scalper and my bread and butter is scalping the order book, to me volatility and paper coming in to the market is where i make my living.

Having said this, i have had a consistent year, and there are always opportunities in the market somewhere. But i am more frustrated at the fact the general public are left to make decisions which are not based on any sound empirical evidence. And politicians only do what is popular, not what is right. I dont want to turn this in to a politics thread. And im please the responses so far have been troll free and interesting but coming in to work every day and seeing the game being rigged by people that are pandering to a growing socialist rebellion is starting to piss me off. Just letting off some steam really
 
USA is becoming like Europe. To hate success, that is something intrinsic to European culture as it had a long history of land owning aristocracy with the rest as serfs. That's why in places like Europe and Britain, there is an attitude that if you are rich, you are destined and if you are poor, well you are going to stay poor your entire life. Your lot and class in life is more or less fixed. Sad to say, America is now adopting these kind of cultural attitudes. The American dream is no more, be content with what you are born into.
 
I agree with the majority of what has been said. I dont think the FTT is a threat though. Firstly it would literally kill all trading, and not just "evil speculators" like us. But for people that use the futures markets (or any derivative market for that matter) as a proper hedging tool.

Im not going to claim futures are a purely noble pursuit but they do serve a purpose. With a Financial Transaction Tax, banks wouldnt be able to lock in interest rates (for loans mortgages etc) not to mention the volatility that will come to the price of day to day goods when you are getting a $1 spread on a gasoline future. I think even the European Governments have slowly back tracked on that.

PLUS if it was enforced in Europe, all it would take is some other country to say "hey guys, we arent imposing that on any of our markets come trade it here" and that country will become the biggest financial hub in the world.
 
I used to tell people what I was doing for a living. But living in France, now I just say I am unemployed. People tend to be more respectful, I have more rights to express my opinion as a total peace of shit. I carefully select the times I wear decently and drive my car. Nobody here wants even a modest part of economic risk but they all want part of the fruits. It wouldn't shock me if people starts throwing molotov cocktail over my fence, I am the only one trading in my place.

PS: On the trading front, after a really crappy start in 2012, I am making decent money since september. I don't know if it is really activity coming back but I see improvement lately. I am just trading 250-400 lots per day, nothing crazy but profitability is back.
 
Quote from tommo:

I agree with the majority of what has been said. I dont think the FTT is a threat though. Firstly it would literally kill all trading, and not just "evil speculators" like us. But for people that use the futures markets (or any derivative market for that matter) as a proper hedging tool.

Im not going to claim futures are a purely noble pursuit but they do serve a purpose. With a Financial Transaction Tax, banks wouldnt be able to lock in interest rates (for loans mortgages etc) not to mention the volatility that will come to the price of day to day goods when you are getting a $1 spread on a gasoline future. I think even the European Governments have slowly back tracked on that.

PLUS if it was enforced in Europe, all it would take is some other country to say "hey guys, we arent imposing that on any of our markets come trade it here" and that country will become the biggest financial hub in the world.
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That alone is not enough. As a country seeks deeper and deeper into a dependency culture, they need to raise more and more taxes even if it creates an overall deadweight loss and secondly, they need to be seen as punishing the rich to placate the voting masses. Once you hand out freebies, you cannot stop as the other guy will promise it to them. That is why there is stamp duty on stocks in the UK and various other silly taxes in Europe.

The only hope now is for China to fully open up the capital markets. With the election of Obama, the future of the world is no longer in doubt and the sun will truly rise in the east and set in the west.
 
Quote from tommo:

I agree with the majority of what has been said. I dont think the FTT is a threat though. Firstly it would literally kill all trading, and not just "evil speculators" like us. But for people that use the futures markets (or any derivative market for that matter) as a proper hedging tool.

Im not going to claim futures are a purely noble pursuit but they do serve a purpose. With a Financial Transaction Tax, banks wouldnt be able to lock in interest rates (for loans mortgages etc) not to mention the volatility that will come to the price of day to day goods when you are getting a $1 spread on a gasoline future. I think even the European Governments have slowly back tracked on that.

PLUS if it was enforced in Europe, all it would take is some other country to say "hey guys, we arent imposing that on any of our markets come trade it here" and that country will become the biggest financial hub in the world.
More...
I'm not so worried about FTT, but over here, increasingly it looks like we might lose the preferential treatment of cap gains. And sometimes, in a bad year, that's the only thing that makes trading better than a real job.
 
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