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Strategies & Market Trends : Technology Stocks & Market Talk With Don Wolanchuk -- Ignore unavailable to you. Want to Upgrade?

To: da_cheif™ who wrote (49152)	12/10/2009 9:58:29 AM
From: Real Man	1 Recommendation Read Replies (1) \| Respond to of 208169

Why do you think it's going up? Central Banks fixed derivatives blowup with Quantitative Easing. Liquidity collapsed volatility. Derivative trades are way up, and dragging World stoxx higher. Who's driving 'em up on record volume? The trading robots who sell volatility, of course, not J6P. The same robots are selling the dollar. They will keep selling it. So, we are even. But to say that 600 Trillion derivative Ponzi scheme that blew up last Fall, was fixed with enormous liquidity injection, and is currently growing, does not represent future danger would be dreaming. No, things are not close to blowing up currently, so your team wins. But the Fix was the same as in 1987, 1990, 1997, 2001, etc. Back in these days it contributed to much bigger derivative bubble, and the CDS portion of it detonated, cause it's kinda instantaneous. The interest rate swaps portion is slow death. Things have been healed, thou, as the Fed became the losing printin' counterparty. Until I see this thing get smaller, not bigger, I'll be worried. Sovereign issues weigh on the heart of it, the so-called "risk free" rate. About 500 Trillion notional, and a fair portion of global stock market in real value. One could reasonably argue that this Fix continues forever, and that path leads to much higher stock prices and hyperinflation, coz the Fed can't stop printin' or the whole mess will collapse upon itself. But, you need to watch 'em, cause if they do stop, it will collapse upon itself -g-