EU Crafts $962 Billion Show of Force to Halt Crisis
Futures are up more than 5% and it appears that the 'bid' on the S&P futures will take the market to an OPEN around 1160...
Which leaves CV to ponder (a point that I rigorously debated and defended, ON MY OWN, last week)... A certain WSWB was credited as being a "genius", a "hero", last week for going all cash. As I recall, the SPX was at 1154 at that point that the announcement was made... CV pointed out that it was "pure luck", and that, in fact, many of the traders on this blog had already made "short bets" closer to the 1219 level.
My point was, how in Sam Hill could any computer algorithm predict a "Flash Crash" (for whatever reason it was precipitated - which is a subject that has already been endlessly noodled)... I suppose, those same algos weren't set with the same parameters that there would be a $962B (that's a "B", not an "M" for the fat finger types - Tuesday they'll probably come in and say that they "fat fingered" that bailout as well and the markets will tank again) bailout announced on Sunday night...
Anyway, here we are back OVER the SPX level that TWSWB made his famous announcement (and bathed himself in accolades for)... Is he still a hero? Sure, I guess...
It works the same way with the market itself... When the market is "melting up", it's supposed to be that way... There's no such thing as LIMIT UP...
CV is just this guy anyway... Nothing to see here, go about your business...
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Posted by Andy T 5/10/10
Good Evening Capitalists,
This author doesn't have any clue about what happened last week, so I won't even pretend to understand or explain it. "It is it what it is." This is what can happen in markets where almost everybody is long and nobody is that short. That is why stocks can go 'bidless' and crash. It was probably some sort of "mistake" that caused a stock like Accenture to hit ZERO in a nano-second, but the way this "mistake" caused all Global stock exchanges, commodities, bonds and currencies to all react in a hugely negative way should serve as a powerful reminder of how "fragile" and connected these markets remain. So much for diversification....
There is only one way to diversify: Stay long some amount of cash*.
*Cash does NOT mean municipal bonds, corporate bonds, US Treasuries or money markets.
236 comments:
«Oldest ‹Older 201 – 236 of 236 Newer› Newest»Leave it to Denninger to put it best.
We may spend a few days looking around for catalysts. Ts will be weaker ahead of the auctions. Friday features a retail number that might not be to inwestors satisfaction. If we have flipped to the bear, then MOMO mondays will soon yield to FLIGHT to Quality Thursdays*/FRIDAYS.
* After Memorial Day, Thursday is the new Friday, White is the new Black, and Bonds are the new Hot Investment.
I would like to have seen the VIX get a little lower today....
mcHAPPY rid himself of the last FXP (all for profit - albeit much smaller than last week) and has loaded up on TZA.
@McHappy
If I had to handicap it, I'd say we keep grinding higher to perhaps 1178-1190...
Seems TOO EASY to stop at a 61.8% retracement...(which was 1162)...
Give Johnny's & MoMos another day to stuff their hard earned cash into Lloyd & Jamies waiting pockets...
Treasury auctions later in the week... Scare them out right before...
I can just hear the wording on the "press releases" having the final touches put on them now...
"OK, we used the FAT FINGER excuse, now somebody give me another idea"...
CV
I would tend to agree, but if that happens it happens tomorrow early and ends negative for the day. I may wait for the last 15 minutes of the market tomorrow before looking.
It would appear Cognos has his mojo back.... unfortunately so does Bucky.
mcHAPPY is losing mojo.
I'm QUITE sure that Cognoose & Wanger had their own super algos to pick off everything EXACTLT at 1065 in that brief millisecond...
Unbelievable traders those boys are!
Flat equities.
We had HYG:TBT combo on into Fridays close as a SAFETY SQUEEZE.
Cashed it in.
It takes a massive WANGER to DIP in and out.
Hugh Hendry clips:
http://www.youtube.com/watch?v=58vUXkepqDA
http://www.youtube.com/watch?v=F5XIF2P5nJ8
Got short (again) right at the close.
Will try to cover overnight.
LB @ 3:58
I beg your pardon...?
mcHAPPY is not feeling too well. Hopefully I get some sleep tonight. Any down day tomorrow effectively kills all shorts. Could be lesson here but before I decide to take it, going to see how tomorrow plays out. My bum hurts. FAZ still green.... slightly red on TZA.
I don't have much conviction about what happens tomorrow, except that SPX is likely to retest 1160.
I beg your pardon...?
Trader Talk.
Thx Karen, for the HH clips... just in time for lunch!
Euro off highs as euphoria over resuce recedes
SPX completed a morning star pattern. Jump you f'rs.
Wanger's motto- if you can't hit the bottom of the bid, bang the hell out of the sides.
Master beta trader.
The Bond Report 5.10.10
Well, well...a face-ripper courtesy of the ECB and IMF with Madrid up 11%.... can you say PAIN..? It was also risk-on in the more sedate world of fixed income where LB's boys with the hedge book had sniffed out the bounce on Friday. We rode HYG to a nice gain, as HY out-performed IG and spreads narrowed across the board.
Corpies: LQD 0.63%; AGG -0.01%; JNK 1.92%; HYG 1.87%;
Govies: TLT -2.01%; IEI -0.49%; TIP -0.28%
We began the day long HY and short TLT for a trade. It was a good hedge and we were grateful and took our profits. There may be selling of the long bond into the auction but we are in wait and see mode. When you don't know what's happening, don't do anything.
The important bits are always hidden at the end
Europe’s debt-ridden nations still have to raise almost 2 trillion euros within the next three years to refinance maturing bonds and fund deficits. Led by Italy’s $126 billion, Greece, Spain, Portugal, Ireland and Italy have a total of $215 billion of debt coming due in the next three months, according to JPMorgan.
“Credit investors should not overlook that this is more of a sovereign bailout rather than a private-sector bailout,” Philip Gisdakis, the head of credit strategy at UniCredit SpA in Munich, wrote in a note to investors. “The austerity measures that will be part of the program will have a negative impact on corporate spreads.”
Glenn Neely seems to be getting more confident...
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Dear NEoWave customer,
The hyper-violent decline produced in the U.S. stock markets last week finally ended the most confusing, difficult portion of the 4-6 year bear market that began January 2008. As a result, market predictability and trading opportunities will be on the rise for the next few months (possibly the next year or two). That is GREAT news for all NEoWave subscribers since the most "frustrating, difficult, unpredictable" phase of development is now behind us. As a result, we can look forward to more clarity and better trading opportunities the rest of this year.
Sincerely,
Glenn Neely
NEoWave, Inc.
~~~~~~~~~~~~~~~~~~~~~~
Neely is due to be correct this time, isn't he?
e-mailed macro-man an invitation to join in commenting here and just received the following:
"Perhaps I might make the odd appearance here and there..incognito, natch.
Cheers
(MM)
No one has ever invited me ...
Another day, another bazooka... just another bizarre day in the history of The Crisis That Never Ends ... what's that Mr. President, beg your pardpn? OH I am sorry: "the normal function of the capital markets". Ooops.
Still in shock about MM's blog. The best thing since sliced bread.
I hope I never hear anything about democracy or capitalism again. Those two ideals are obviously dead.
EURUSD back where it closed Friday, all the yen crosses and risk currencies stopped at trendline support/resistance. All looking a bit bearish in FX land, perhaps we retest the lows before we rally.
Nic,
Did you ever see such weird sh*t in your entire life?
Nope LB, I truly have not.
The reformed broker had a competition to re-name the euro bazooka. My tame suggestion of the Trichet Put did not win. It is now known as the "Debt Baguette"
What a mess. Nothing in this package stops Greece defaulting, it looks like just another bankster bailout to me.
I am at a loss for words, which is rare.
You were right, btw, NIc. A and E were the CORRECT answers.
A. Face ripper.
E. Karen's new icons, LB loses focus !!
Barry Ritholtz said...
No one has ever invited me ...
....Consider yourself invited. However you must check your coat and swelled head at the door.
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