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Strategies & Market Trends : 2026 TeoTwawKi ... 2032 Darkest Interregnum

GLD 414.48

+0.7%

Jan 9 4:00 PM EST

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To: Snowshoe who wrote (56350)	10/12/2009 9:32:53 PM
From: TobagoJack	1 Recommendation Read Replies (1) of 219210

just in in-tray, and i quote ... Had an interesting conversation with a very senior officer in one of the largest US banks yesterday that now has a large brokerage operation. He noted that he thought that the VIX was too low and that they were seeing lots of fund managers taking risk off the table by buying call options. That is, if they held a stock that went from $10 to $15, they were selling the stock and then turning around and buying calls on the same stock at a similar strike price, keeping themselves in the game, but limiting their downside if the market turned south... He was giving the typical "things are getting better" speech and we were relatively unimpressed. But we did ask if New York was now full of foreigners shopping there because it was now cheap. He replied, "yes, it's like we're becoming the new Indonesia....." Obviously a joke, but to even think about putting the US in a similar context as Indonesia may tell us more about what he really thinks than he cares to admit. He thought the biggest risk here was simply a turn in sentiment to the bearish side again......he seems to think that much of this is simply a confidence issue. (I disagree, but I'm merely passing along what he said). He noted that bad loans were still growing on their books but at a decelerating rate. Thought unemployment was a big key (no kidding).... He also noted that loans with no covenants were returning to the market! (we were shocked). But he said that so far, those loans were only being extended in places like France to very large companies that the banks perceived as being "too big to fail" and that would be bailed out by the Govt. if they got into trouble.....

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