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Non-Tech : Derivatives: Darth Vader's Revenge -- Ignore unavailable to you. Want to Upgrade?

To: Bobby Yellin who wrote (153)	9/24/1998 10:12:00 AM
From: Henry Volquardsen	Respond to of 2794

Bobby, Some liquidity has disappeared but it hasn't evaporated. I know I have more liquidity than before this crisis, my credit has held up and I've remained profitable. Liquidity has dried up in spots but not systemically which was my point. I also don't believe the issue of too big to fail has come into play. LTC was not to big to fail, they have failed. This 'bailout' is just an organizational vehicle to facilitate liquidation. If it had just failed outright it would have been an organizational nightmare straigthening out the repo market. Not a credit nightmare an organization nightmare. This just keeps everything in place to make it more efficient to deal with. But liquidity always tightens during periods of heightened credit concerns. What is happening at the moment is not the worse I have ever seen. That is not to say it couldn't get worse, just hasn't yet. XAU is going up, I believe, because of the inflationary implications of the anticipated rate cuts. More knee jerk than anything else imo. Henry