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Strategies & Market Trends : Waiting for the big Kahuna

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To: GROUND ZERO™ who wrote (83709)11/26/2008 9:40:47 AM
From: Real Man1 Recommendation  Read Replies (1) of 94695
 
Two monsters are fighting, with what outcome?

One monster is the derivative market

The other monster is the Fed that lost all sense of
proportion and is creating tons of liquidity to bail out
derivative markets and trying to make volatility go lower with
injected liquidity (the two are inversely related!)

7 Trillion the Fed made available could be enough for
derivative markets, since notionals don't fully reflect
the state of the markets. Then we go sharply up to get December
puts expire worthless, and hyperinflation returns. If not,
then ... <g>

Lights out only if all that liquidity causes a run on the
currency and the treasuries, the dollar moving down is not
necessarily "it"
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