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Strategies & Market Trends : Steve's Channelling Thread -- Ignore unavailable to you. Want to Upgrade?

To: Crimson Ghost who wrote (11663)	2/23/2001 6:47:06 PM
From: Zeev Hed	Read Replies (1) \| Respond to of 30051

George, note that the strength in the market was less than I expected to, I thought we could go above 2300, we did not. I saw you noting earlier todat that the naz tick got under -1000 twice, I watch the tick on Yahoo quotes, and there it did not go beyond -947 (not enough for a day like today, nor was the trin high enough for a bottom yet), where do you get your numbers from and why do you think they differ? Are they using a slightly different base of stocks? Zeev

To: Crimson Ghost who wrote (11663)	2/24/2001 3:13:44 AM
From: Sam	Respond to of 30051

George, <<No question the odds of a Black Monday are low, but they are not totally negligible. And public is MUCH more heavily involved in the market now than in 1987. Plus the derivative market with its potential for truly staggering losses was virtually nonexistent then. >> Well, the derivative market as we know it may have been nonexistent, but we still had massive amounts of portfolio insurance, along with the naive belief that it would "protect" whole portfolios. Derivative hedging is a little more sophisticated than that, especially after the LTCM margin fiasco (at least I HOPE so). And back then there were fewer restrictions on margin for traders, so even if the public was less involved, there were a lot of people who made millions before '87 selling naked puts to their heart's delight and lost it all plus some more in just a few weeks. Both of these things magnified the problems going down in '87. Today there are more restrictions on margin, brokers and clearing houses tend to be more aware and more restrictive (since they don't want to go under either) now than then. Of course, the possibility of a massive derivative "accident" is always there, but in theory at least, there are checks to ensure that it won't occur or spread. Sam