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Strategies & Market Trends : The coming US dollar crisis -- Ignore unavailable to you. Want to Upgrade?

To: Real Man who wrote (21918)	8/11/2009 8:30:22 AM
From: DebtBomb	Read Replies (2) \| Respond to of 71456

Dollar's Hit a "Major Bottom," Prechter Says: Why That's Not Such Good News Forget all the talk about the dollar being in terminal decline. The recent rally in the greenback is for real, says Robert Prechter, president of Elliott Wave International. The man who correctly predicted the 1987 crash and last year's peak in oil prices now says we're "going to be up for a year or two in the dollar." Reuters and other mainstream news outlets attribute the recent uptick in the dollar versus other major currencies to an improving economy signaled by Friday's "stronger-than-expected U.S. jobs numbers." Prechter, ever the contrarian, says the U.S. dollar has put in a major bottom but not for the reasons everyone else is pointing to. Prechter points to three factors: •The Elliott Wave Pattern: Without getting too technical (for your sake and mine) Elliott Wave Theory looks at markets cycles in terms of wave structures that come in five parts. Five waves up followed by five waves down. Well, according to Prechter's research the pattern confirms we recently hit the fifth wave down. Next stop: up. •Sentiment has reached an extreme: "The Dollar Sentiment Index for the Dollar Index reports just 3% bulls among traders, an extreme level only five times in the past 20 years, usually near an important low," Prechter wrote on Aug. 5. "The last time we saw readings like this was March-July 2008, just before the dollar soared." In other words, the "short the dollar" trade is overly crowded. •The biggest risk to the economy is deflation not inflation: As he lays out in his book, Conquer the Crash, Prechter thinks the bursting of the latest bubble will lead to a major economic depression. As we discuss in forthcoming segments, this good news for the dollar spells bad news for most other asset classes including stocks, commodities and real estate. finance.yahoo.com

To: Real Man who wrote (21918)	8/14/2009 12:22:30 PM
From: RockyBalboa	3 Recommendations Read Replies (3) \| Respond to of 71456

Vi - your CDS Trillions - here you go. As we earlier suggested, overinsuring neighbours house then burning it down >>>> very prominent voice. Now Max90 should come and read it: Harry Markopolos: CDS Fraud Will Make Madoff Look "Small-Time" Lawrence Delevingne\|Aug. 12, 2009, 2:01 PM\|38 businessinsider.com Memo to regulators: be forewarned about frauds in the credit-default swap market. They'll make Bernie Madoff's $65 billion fraud "look like small-time." That's what Harry Markopolos -- Madoff's whistleblower ignored by federal investigators -- is saying, anyway. New York Post: [Markopolos] says there are evildoers out there who will make the Ponzi scum "look like small-time." Markopolos gave a speech to 400 of the faithful at the Greek Orthodox Church in Southampton and predicted major scandals will soon be revealed about the unregulated, $600 trillion, credit-default swap market. *"To put it in simple terms, it is like buying fire insurance policies from five different insurance companies on your neighbor's house and then burning down the house,"* he said. It's not clear if there are frauds that he knows of, specifically, that he's not disclosing publicly, or if it's just his how the market works -- in which case, he's basically just parroting what a lot of people who hate "naked" CDS have been saying. Either way, we suggest Mary Schapiro or the CFTC pay him a call and get a clarification. businessinsider.com A SCANDAL BIGGER THAN BERNIE August 12, 2009 -- nypost.com HARRY Markopolos -- the whistleblower on Bernie Madoff who proved to be much smarter than the SEC -- says there are evildoers out there who will make the Ponzi scum "look like small-time." Markopolos gave a speech to 400 of the faithful at the Greek Orthodox Church in Southampton and predicted major scandals will soon be revealed about the unregulated, $600 trillion, credit-default swap market. "To put it in simple terms, it is like buying fire insurance policies from five different insurance companies on your neighbor's house and then burning down the house," he said. After his lecture, Hampton Sheet publisher Joan Jedell reports Markopolos was feted at a dinner at Nello Summertimes hosted by John Catsimatidis and his wife, Margo, who were joined by Al D'Amato and Greek shipping magnates Nicholas Zoullas and Spiros Milonas. nypost.com This is my original suggestion - and at the time no one believed me: Message 25355060 In CDS world all that does not apply. It is no problem to overinsure a 4B bond issue some 10 or 20 times. It pays off to slaughter a company (or have bought directors doing the job) and collect a multiple times of the defaulted bonds from the insurers. As I said this is only possible with cash settlement instead of delivering a defaulted issue which would effectively limit the compensation amounts to the real economic damage. Message 25354063 All happened when the CDS protocol was changed to "cash settlement", from physical delivery. As in fire insurance: I actually don´t need to own the house which is set on fire. It could be the neighbours or the ex spouses house. Or, I don´t need to turn over the wreck any more; all I need is to show a photograph of the car... Said that, while cash settlement resolved the problem of inefficient defaulted bond prices (which were sometimes too high going in a settlement), it opened the real can of worms. Derivative bets on the default and ultimate settlement prices can reach an high multiple of the default in question, as if a thousand similar houses would burn.