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Strategies & Market Trends : 2026 TeoTwawKi ... 2032 Darkest Interregnum -- Ignore unavailable to you. Want to Upgrade?

To: Bert who wrote (48425)	4/11/2009 12:02:01 AM
From: carranza2	Read Replies (1) \| Respond to of 217705

A difficult article for a layman to digest without having to go hither and yon to get context. My take is that it suggests increased volatility coming but that the author cannot necessarily call the direction. If you take the case of the CDS market as a guide, it suggests the downside. One thing I saw that the author really doesn't get into and that is liquidity. Market neutral funds only supposedly take long or short positions with no more than 10% of their liquidity. I think I read him to say that the market neutral hedge funds are not liquid. Don't understand how this can be the case given their strategies, but what do I know. This is way over my head.

To: Bert who wrote (48425)	4/11/2009 2:36:27 AM
From: elmatador	Respond to of 217705

C.C banking liquidity hitting it'll result on a bank run and nationalization next day. The article talks liquidity as in "liquidity in banking". Because most banks are plainly broken, since they did not hold liquid assets as in: Liquidity is the easiness of transform an asset into cash. Because banks did not have liquid assets to transform into cash, i.e., they are not liquid, governments afraid of a bank run, keep giving them cash (TARP, "stimulus", etc) , so people don't demand their money causing a total bank collapse. It is better -governments reason- to have a bankrupt bank saved by nationalization than to have a bank run. Note that "stimulus" packages are a way o sell -to the ignorant masses- giving cash to avoid a bank run dressed up a "projects" to create jobs...