who ruined the US markets ?

[wrbtrader]

Quote from Bob111:

i would add uncertainty. fear and uncertainty. even pro's are giving up,cause today markets been driven by fed and politics...

I don't see institutional traders (the pros) giving up. I see a transition into different markets then traditional markets that were traded by them. In contrast, retail traders (most of us here at ET) tend to get married to a particular trading instrument without testing to see if a different trading instrument is more suitable for current market conditions.

Heck, the past week its been confirmed that Light Crude Oil (WTI) markets have now been replaced as a normal benchmark by the world. Its now the Brent Oil markets the benchmark.

Also, its no longer just the FED. We now have to be concerned with the ECB and IMF events. That's part of the adaption that many retail traders need to make in their understanding of market context but will fail to make...they are so damn worry about the FED that they are forgetting that markets/economies/politics from around the world are so damn interconnected. That disconnection for most retail traders about what's going on in the world and how it impacts the trading instruments they trade will be costly.

 

[achilles28]

Quote from wrbtrader:

I don't see institutional traders (the pros) giving up. I see a transition into different markets then traditional markets that were traded by them. In contrast, retail traders (most of us here at ET) tend to get married to a particular trading instrument without testing to see if a different trading instrument is more suitable for current market conditions.

That's what I'm driving at.

Where has the volume gone?

I'm thinking OTC derivatives, like ABS, CDS etc.

 

[halfwaythere]

Quote from wrbtrader:

I didn't say anything about market direction which is an entirely different topic nor does it have anything to do with my replies.

Volume and volatility will continue to remain low until investors bring their money back to the markets. As to the overall direction...I'll let the academia and long term investors worry about that.

Think this will happen after 2016 or will we be Greek status.

 

[Grandluxe]

Quote from halfwaythere:

Think this will happen after 2016 or will we be Greek status.

Worse if we do a Japan, have zero growth and muddle along where nothing really happens.

 

[wrbtrader]

Quote from achilles28:

That's what I'm driving at.

Where has the volume gone?

I'm thinking OTC derivatives, like ABS, CDS etc.

I really don't know what markets the institutions (the pros) have been moving their billions into. As for the individual investors that have pulled billions out of the markets...they sure aren't reinvesting in other areas of the markets.

I'm sure with a few hours of research, the answer is there on Google or already discussed a few times on one of the financial networks (bloomberg, CNBC).

 

[Bob111]

Quote from wrbtrader:

I don't see institutional traders (the pros) giving up. I see a transition into different markets then traditional markets that were traded by them. In contrast, retail traders (most of us here at ET) tend to get married to a particular trading instrument without testing to see if a different trading instrument is more suitable for current market conditions.

Heck, the past week its been confirmed that Light Crude Oil (WTI) markets have now been replaced as a normal benchmark by the world. Its now the Brent Oil markets the benchmark.

Also, its no longer just the FED. We now have to be concerned with the ECB and IMF events. That's part of the adaption that many retail traders need to make in their understanding of market context but will fail to make...they are so damn worry about the FED that they are forgetting that markets/economies/politics from around the world are so damn interconnected. That disconnection for most retail traders about what's going on in the world and how it impacts the trading instruments they trade will be costly.

first part is really easy answer...they didn't give up cause #1-it's ITS NOT THEIR MONEY..
#2-I've said thi s long time ago-the markets will continue to do "fairly well" for one and very simple reason- CAUSE AS LONG AS PEOPLE WORK IN US-they have to invest somewhere their pension money. get this trought your head-THEY ARE FORCED TO INVEST...it's stock market economy on kindergarten level..at least to me..common...
as for second part-that's where i agree. globalization is the name of the game now..like it or not..

 

[denner]

Quote from wrbtrader:

I really don't know what markets the institutions (the pros) have been moving their billions into. As for the individual investors that have pulled billions out of the markets...they sure aren't reinvesting in other areas of the markets.

I'm sure with a few hours of research, the answer is there on Google or already discussed a few times on one of the financial networks (bloomberg, CNBC).

I can guarantee that a significant chunk of that money being pulled from the markets is being used to "just get by". (i.e. with ZIRP, many who could live off of some form of interest income aren't so lucky any longer), combined with the fact that after a certain age investing in equities (especially a market that collapses every 5 years or so) just ain't gonna happen any more...think demographics.

IOW, those investment accounts aren't coming back.

 

[plyka]

Quote from iceman1:

just curious.

actually there are probably a few geniuses out there who actually like this cr-p and can spin it that there are trading edge(s) in these markets like back in the 1970s- through 1990s. lol

I am so confused by these absolutely irrational thoughts, not only that this guy above is having, but that are pervasive throughout main stream thought. This idea that more money was made or that it was easier to make in some long ago past.

Let me ask you ---do you understand that trading is a ZERO sum game? Futures are a completely zero sum game --the amount of money made is EXACTLY equal to the amount of money lost (factoring out commissions and other structural costs). Stocks are near zero sum, the shorter the time horizon the closer one gets to a zero sum game. The reason stocks are a positive sum game over time is due to their earnings. But even here, if you're trading over even a long 6 month holding period, you're still very close to a zero sum game.

So how can it be easier to make money in the past? There were the same amount of losers as there are now. Someone has to lose for you to win. So if there were winners in the past, however many their numbers (in monetary terms not in numerical terms), there were just as many losers. And now, if there are a lot of loser then there are the same amount of winners (again, not numerically but monetarily).

In a zero sum game how can there not be winners if there are losers? If you're losing now and were winning before, it simply means you've moved from a winner to a loser. It does not mean that there are more losers now. There are the same number of losers as there has always been.

 

[thunderbolttr]

Quote from wrbtrader:

Hey Austinp,

I've seen "a lot" worst in terms of volatility. The crap trading years were 1991 - 1995...consistently during a 4 year duration. Then again another session of crap trading years 2004 - 2006...consistently during a 2 year duration.

Recently, we've had crappy trading the latter part of 2010 and early part of 2011, early part of 2012 and again since June of 2012. That inconsistent volatility, regardless if its low or high, has made it extremely difficult for many traders to adapt. Thus, the low volatility trading stuff we see now is still just a baby in comparison to what has occurred in the past. Simply, if its tough trading now...it has a lot more room to get much worst in terms of volatility since 1991.

My point, if volatility does get worst and consistently like 1991 - 1995 and 2004 - 2006...retail traders will get hit extremely hard except for those with deep pockets and/or patience.

Yeah, I've traded through all the above.

Answer - Markets are not ruined. If it was, it'll be an Apocalypse.

Very interesting. As a relatively new trader (early 2008), some of these conditions are relatively new to me.

I was wondering how you would rate the current conditions on a scale of 1 to 10?

How does that compare to 2004-2006? And 1991-1995? Were those times significantly worse? Thanks.

 

[wrbtrader]

Quote from thunderbolttr:

Very interesting. As a relatively new trader (early 2008), some of these conditions are relatively new to me.

I was wondering how you would rate the current conditions on a scale of 1 to 10?

How does that compare to 2004-2006? And 1991-1995? Were those times significantly worse? Thanks.

Yes as I stated, I've seen a lot worst than current low volatility market conditions and my reference to such is 1991 - 1995/2004 - 2006.

On a 1 to 10 scale...

2012 = 7

2004 - 2006 = 6

1991 - 1995 = 4