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Strategies & Market Trends : Waiting for the big Kahuna -- Ignore unavailable to you. Want to Upgrade?

To: Moominoid who wrote (29674)	10/1/1998 10:21:00 AM
From: James F. Hopkins	Respond to of 94695

Hi David; I don't think there is any way to tell, but it's safe to say it was a good bit. I sang out just about the 3rd or 4th that I saw a big bear trap in the Futures pits. The thing is they can leverage out 90% in the pits, so that makes the positions hard to hold or near impossible to hold when the market jerks the other way with the type of volatility we have had. ------------- All in all the way this is set up it defeats the purpose of a market to begin with. Stocks don't fly or die on their merits, but by a set of mechanics that "forces" the arbitragers to buy more of the big caps until a point is reached that staggers the imagination. The leverage also gets layered as derivative positions are used as assets by banks to lend out money to some fund so that fund can buy more derivatives. The regulators all look the other way and pretend this is not suicide. ------------- There is no one part that can be blamed for the mess I see, it's gotten itself so tangled up and commingled with one thing being dependent on another that the reality of it winds up being a Form of communism, a form that came into existence not from debate or vote or any type of fore thought other than to chase short term dollars. There is an irony to it all that it was born, nursed, and cultivated primarily by the faction who hates communism the most. ------------------- While I can see the picture clearly, I'm not as articulate or as good at finding words to paint it with as many who have made words their stock and trade. I'll have to give some thought as to how to illuminate several of the major faults in the market, faults that defeat it's primary purpose to even exist. These are major problems that if not corrected act like a death spiral to a free market. This is not just a matter of excesses, it has to do with the evolution of financial instruments being created that in no way should have been allowed to begin with. Not directly related to the above, but to open this can of worms I'm afraid may eventually it will lead to a sad story of corruption run amok, regulators that turned a blind eye, and politicians who have practiced and made hypocrisy a from of art until they have virtually destroyed the virtue of being honest in this system. It does not matter how fine a form of government a nation can put together, there is a cancer that if unchecked can destroy it. It becomes it's own worst enemy and you can count on that process being well advanced when you see it shifting the blame, and looking out side for a scape goat. The market gurus now pounding the table about how Japan and Russia need to get their house in shape are busy as hell sweeping garbage under the rug right here at home. Jim