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 : Clown-Free Zone... sorry, no clowns allowed -- Ignore unavailable to you. Want to Upgrade?

To: MythMan who wrote (391759)	8/4/2009 4:35:45 PM
From: Giordano Bruno	Read Replies (2) \| Respond to of 436258

meaningless and bullish reuters.com

To: MythMan who wrote (391759)	8/4/2009 8:53:39 PM
From: Real Man	Respond to of 436258

That's not how it all works, but he describes the cause and effect right. That dude needs to learn C, the Druid language. Once liquidity is injected, volatility is brought down, which, in turn, leads to the market rally. The boyz just sell options. They profit handsomely as long as IV at time of sale is greater than volatility at expiration. Then of course.. there is true manipulation during OPEX week. Back in 2007 they sold vol so hard, the spoos appeared dead. And then when vol spiked in 2008, the Fed absolutely had to apply a lot of glue. I think C blew up on this. In summary of Druid language, constant liquidity additions by the Fed make Druids sell volatility, which, in turn, pushes the market higher and the dollar lower (it's carry trade in currencies), whereas lack of liquidity due to black hole of debt blow ups pushes the dollar and volatility higher, and the markets lower. Derivatives truly blew up last Fall, that's what happened, but now the printing Fed is the losing counterparty, so everything was fixed, except that the whole pyramid will now double once again, shortly.