Silicon Investor (SI) -- The First Internet Community

STOCKTALK

We've detected that you're using an ad content blocking browser plug-in or feature. Ads provide a critical source of revenue to the continued operation of Silicon Investor. We ask that you disable ad blocking while on Silicon Investor in the best interests of our community. If you are not using an ad blocker but are still receiving this message, make sure your browser's tracking protection is set to the 'standard' level.

Pastimes : The Naked Truth - Big Kahuna a Myth -- Ignore unavailable to you. Want to Upgrade?

To: Cynic 2005 who wrote (80215)	12/17/1999 2:46:00 PM
From: MythMan	Respond to of 86076

Everyone is going vertical now..I'm with Fleck...see ya next year when this thing stops....if it ever does.. New high on Dow btw.

To: Cynic 2005 who wrote (80215)	12/17/1999 2:46:00 PM
From: pater tenebrarum	Respond to of 86076

i fully agree on the influence delta hedging has had on this blast-off. the banks have a problem competing for funds (everybody steering his money into stocks) and for business, meaning the quality of their lending is declining precipitously. banks and brokers also steer increasing amounts of lending toward securities and real estate, both of which are sectors where the risk of default seems very high. we're getting set up for a Japanese style multi year depression should any of the legs this house of cards is built on buckle. many of the banks will suffer due to the decline in lending standards. that said, your post and mine should suffice to produce a bottom in the group.

To: Cynic 2005 who wrote (80215)	12/17/1999 2:55:00 PM
From: Defrocked	Read Replies (3) \| Respond to of 86076

A market that goes straight up isn't necessarily volatile. What kills delta hedgers are gap moves. VIX has been steady between 20 and 25% this entire up move since late Oct. BTW,it's a darn good thing Dow-Jones added MSFT, INTC HD and SBC to the DJIA...or we might of had to wait a bit longer for a return to the August high.-s-

To: Cynic 2005 who wrote (80215)	12/17/1999 2:58:00 PM
From: pater tenebrarum	Read Replies (2) \| Respond to of 86076

Mohan, one more thing, i keep hearing rumors about the imminent failure of several smaller banks...btw, if AL.com is panicking because his buddies are in trouble over their call selling, why drive the market even higher?

To: Cynic 2005 who wrote (80215)	12/17/1999 5:23:00 PM
From: Knighty Tin	Read Replies (1) \| Respond to of 86076

Mohan, Any time there are big winners, bullish or bearish, there has to be big losers. True, many deals are hedged, but, lots are not, and somewhere, many players have to be without a hedge or woefully underhedged going the wrong way. And it isn't always me. <g> You are right to look at the big NYC banks and brokers. They are lending money to floor dealers and hedge funds. Of course, they are pretty confident that AG will take whatever reckless move he has to take to bail them when the thing blows up. Except he is now faced with an all-time high in the trade deficit and higher interest rates. I am not really as worried about the retail investors as the institutional ones. If an individual goes 30 cents under maintenance margin, he is cashed out and "thanks, sucker, who's next?" But if an institution violates margin requirements, a lot of fudging is done to make it look good. This is what happened to LTC. I think we not only have one, but several of these disasters brewing. After all, Julian Robertson's Tiger Fund has fallen from $20 billion in assets to $8 billion. Only $5 billion was customers running for the hills. $7 billion was losses in assets. And, as much as I may call him names from time to time, Robertson is one of the smartest guys in the hedge fund business. If he is getting clobbered like this, what about the dumber players? And what about the illiquid players? Methinks there is a huge problem below the visible tip of this iceberg.