I was about to post this in the last thread where there was some green tech discussion...
Sustainable energy technology is exactly what the big new re-investment area needs to be. Wind and solar thermal can already be competitive with fossil in some places.
Hydro and nuclear are also sustainable energy technologies which should be expanded.
A/C and heat are not large energy sinks compared to motive power, and so do not kill the viability of plug-in electrics. It's silly to dismiss the whole arena because some ancient prototype didn't work well. Check out Better Place | The global provider of electric vehicle services for a realistic comprehensive electric car vision that is getting real traction in several locales--Israel being in the lead.
I'm no fan of government boondoggles, but a useful approach could be for the gov to put in tax mechanisms that put a price floor on fossil-based energy, so that investment can proceed in green tech with less risk.
As I said niche markets. You can't argue with BTU's.
Hey, I like golf carts, but John and Sally want a car that is at least 80% similar to what they have been driving for the last 20 years. Remember the Canadian toilet smugglers??
No way, no how, do we have enough time to explore niche markets, economically or practically.
All of these so called improvements are fake because they are financed by the US taxpayer, who is going down the shitter at the moment, while AIG and GS execs fly around in their corporate jets.
The amazing day in the long bond market has to have something to do with the now certain death of Citigroup. What, exactly, I am no expert to be able to describe. Maybe someone here can puzzle it out.
Buffett is basically selling the future index at current levels in a trade with insurance companies that want a backstop for their annuities. If Berkshire loses AAA, they will have to put up collateral. Grandma Goldie , of course, is not AAA. This might explain with the recent Government Sachs 'shrinkage'.)
From MSN:
Shares of Warren Buffett's insurance holding company are on the ropes this month, plunging 30% in part because the famed investor dabbled in an area of the market he has long publicly derided: derivatives. And due to a tangled web of financial relationships, they may be taking Goldman Sachs shares down with them.Investors are concerned about a $37-billion bet that Buffett made last year that U.S. and world equity values would be higher in 15 to 20 years than they were then, when the Dow Jones Industrials were trading around 13,000. Through his firm, Berkshire Hathaway, Buffett sold option contracts, known as "naked puts" to an undisclosed group of investors for around $4.85 billion, reportedly using Goldman as broker. The buyers saw the puts as a type of insurance that would pay off royally if stocks fell over the next decade. They were seen by Buffett as an easy way to pocket a quick $4 billion-plus, which was booked much like an insurance premium, even though he is famous for scoffing at derivatives as "weapons of mass financial destruction."But easy money is the worst kind. The problem is that stocks worldwide have gone downhill in a hurry, and with a lot of the sort of volatility that makes put contracts swell in value. And due to accounting rules, this has made Buffett already need to mark down a $6.7 billion loss on the trade even though the trade has another 14 years to work out. Because of its solid-gold credit rating, Berkshire Hathaway was not required to put up collateral to make this trade. But now rumors are flying on Wall Street that the owners of the contracts have demanded that broker Goldman Sachs put up collateral for the rest of the amount due. Since the value of the trade could be enormous, the collateral demands are said to be very large, and fears that Goldman will struggle to make good on its obligation has panicked shareholders.Indeed one theory making the rounds this week is that Buffett put $5 billion into Goldman at around $125 per share in September not as an investment but to help provide funds for the collateral.
burnside - I think there will be inflation. Deflation may come first, but in the end the Fed will print. (This is obviously a highly debated point, so everyone please don't flame me.) But! (there always is) I realize TBT will have a significant downside if deflation comes first, since it is 2x. Now I am looking for a point to enter USO sometime soon. Note that I am NOT a trader, or a god like rich. Disclamers: IMHO, TINFA, IANAL, YMMV.
...."Hey, I like golf carts, but John and Sally want a car......"
John & Salli in their older years don't actually mind the dry heat of Nevada AND the actual golf cart they use for most trips into town once a week (12-miles R/T)
The US stock markets have finally found Nirvana. They are accepting the bad news.
But during the collapse and confusion, money interests ran for the dollar and US treasuries. They ignored the leftist leanings of the US government, yes; even Bush was left of center, though few would recognize the fact.
Now the US is going full left, congress and the administration, at a time when the US is more broke than ever before.
The next markets to watch are the dollar and treasuries.
And gold. While many see gold as a recent disappointment, the fact is it is doing better than the dollar, oil and stocks.
As the leftist (one can not separate politics from economics and is a fool to try) US government spends and further destroys its currency and treasuries, gold will soar.
The stock markets have officially handed the baton to gold.
Ministry of Truth writes:
General Motors Corp said on Friday it will return two leased corporate jets.
Ministry of Truth | 11.21.08 - 10:50 am
For real? Link?
I'm so glad that they are willing to scale back some for their 25 billion USD aid. How exactly did they expect that show to go? Was it so bad that it was scripted that way?
Better yet, is it really so bad that they will cut back on executive perks??
burnside - UNG as well. FSNGX did well for me 2004-2007. The latter is now below my previous entry point, but it is stock-focused. Counterparty vs. equity risk. Dithering.
This isn't Buffett making shrewd investments. This is attempted altruism. He believes that his role is to try, despite the circumstances, to save the system which made him very wealthy.
Viewed with that lens I'd run away from anything he is pouring money into.
...I'm the LAST one here saying CEO's make too much, but seriously - $25m to Wagoner p/yr vs. Toyota CEO of $1m p/yr and Toyota DOESN'T have its hand out. Add to that the attitude of GM - It adds up to: Screw 'em.....Have'em find their own Daddy!
President-elect Barack Obamas transition team is not exploring a prepackaged bankruptcy plan for U.S. automakers, officials from Obamas team said on Friday. Bloomberg News reported that Obamas transition group was exploring the option.
I am on hold with Fidelity. (Their computer claims my attempts to sell today are good faith violations -- they are not).
What are you selling? Mutual funds?
I asked about moving money back and forth between FDRXX and FDLXX this morning, they said while there are gating restrictions on mutual funds, they do not apply to MM funds.
As the "savage bear market rally" just doesn't seem to want to materialize, could it be that because of the ridiculous leverage and all the hedgies that "this time it will be different" and we go straight down?
blackhat(Unrated) writes: o.k. I see sufficient volume and downward velocity to call for a -500pt drop.
If it breaks down hard again, I'm gonna join you. If today is a referendum on knife catching, I think the results of the vote will look clear from the noon exit polls.
Citi is down to $3.70. This is delicious. I always detested the arrogant "international octopus" with its tenacles everywhere, as it were. Now what a deserved comeuppance. I think C will beat UBS to the bottom. LOL
An aside: One of the beauties of working in the financial services industry: you can screw up, be consistently wrong for months and still be employed. Better yet, you can do this with OPM. I prefer however to be able to sleep at night.
Peronista-
About 30 of us from one group going down to SF FED tomm..
Time for all the bloggers to go..It's to easy to write about all the ills we face, time to get away from Internet and PC and take it main stream....Good luck
"...declines in the longer yields probably suggest deflation trades."
Maybe, but evidence of deflation didn't suddenly grow worse yesterday. There was plenty of talk of negative Philly Fed price figures before they were released.
Never underestimate the power of the calendar for portfolio managers. The end of the month (end of the year for some) is just around the corner, with only two and two-half very illiquid days next week to tidy up portfolios. Duration needs are rising as yields drop, and the long bond gets you duration cheaper than anything else. That is apparently why the bond was up at the open today, while the rest of the curve was down. Mortgage desks (they still exist) also have to re-hedge when the range extends, so that a run into (or out of) long-end Treasuries gains a certain inertia in the short run. Finally, steepening trades have been popular, and when the long end began to come down, those needed to be undone. The sharp rise in CMB and corporate bond spreads also represented a big rejiggering in spread trades that would have led to the purchase of long-dated Treasuries. There were lots of largely mechanical reasons to buy the long end this week, separate from any thoughts about deflation.
I am not having any problem with QID. This is what I have:
QID
PS UTLRSHRT QQQ\tRefresh
Last [Tick]\t99.09[-]\tChange\t 0.49
Volume\t13,268,185\t% Change\t 0.50
Day High\t101.34\tOpen\t95.54
Day Low\t93.35\tBid\t99.08
Prev Close
(11/20/2008)\t98.60\tAsk\t99.15
This isn't Buffett making shrewd investments. This is attempted altruism. He believes that his role is to try, despite the circumstances, to save the system which made him very wealthy.
Buffett has always presented himself as long run "bullish on America". I doubt he ever expected the disaster now upon us. He opined that the credit crisis was largely past quite a while ago, only to have it return with a vengeance. All his recent purchases (IR, BNI, KFT, UNH, KMX, etc., etc.) are underwater, some very very underwater. He says he doesn't "time" the market, but I think he should have tried at least to do so. It would have saved him a few billion.
Citigroup announced today that it will send its entire senior management along with most of its assets on a 'team building' exercise in the Gulf of Aden. 'We're just going to float around out there for a while until this all gets worked out,' a company spokesman said.'"
I'm currently working as a mad scientist on determining how much money is over valued, this may be be ugly and I return now to my hole at Yves place; anyone that wants to have fun, drop by:
Here we are again with the short-term stuff at zero:
As I thought about the stuff I posted last night, it seems probable that there is an overvaluation problem with money. Can that be placed into the mold of deflation or is it related to my concern that there has been fraud overstating GDP, and are those two possibilities related, i.e, if there was fraud or mistakes made to over value GDP for years, has that resulted in triggering deflation?
That seems like a good question to me, and what I'm looking at is gamma and the factor by which money has been overvalued, e.g, if the yield curve has been a model that has been increased by a factor of 1/2, what does that mean?
In terms of GDP, which used to be around $13 Trillion, how could that be related to money being overvalued.
This is over my head, but what the hell:
Tikhonov regularization is the most commonly used method of regularization of ill-posed problems. In statistics, the method is also known as ridge regression. It is related to the Levenberg-Marquardt algorithm for non-linear least squares problems.
So, the trick here is to see if this overvaluation is recent or if it has been building up ever since:
The Cox-Ingersoll-Ross model in finance is a mathematical model describing the evolution of interest rates. It is a type of "one factor model" (Short rate model) as describes interest rate movements as driven by only one source of market risk. The model can be used in the valuation of interest rate derivatives. It was introduced in 1985 by John C. Cox, Jonathan E. Ingersoll and Stephen A. Ross as an extension of the Vasicek model.
Bottom calling is getting laughable...CNBC is nothing but one person after the next calling the bottom, they should put the fund mgr's YTD performance on the screen when they call a bottom - then everyone will know how wrong they have been and how hard they are "selling" just to no go hungry!
blackhat(Excellent) writes:
o.k. I see sufficient volume and downward velocity to call for a -500pt drop.
Been wrong before, will be wrong again.
That's my call.
Eric writes:
Plantagenet writes:
I am on hold with Fidelity. (Their computer claims my attempts to sell today are good faith violations -- they are not).
Fidelity has barred me for 6 months from buying any Fidelity funds. Best thing that happened to me this year
No, it's the QID I got yesterday at 86.23 (my bet entry ever). I am trying not to spoil it by having the worst exit ever. With Fidelity's web site you can put both limit orders and stop loss orders that are mutually cancelling, to bracket the possible outcomes. A few % either way and I'm out.
Buffet not leaving a penny for his grandchildren... saw one woman interviewed on Oprah and boy was she pissed. Working as a cleaning lady for rich people.
No, it's the QID I got yesterday at 86.23 (my bet entry ever). I am trying not to spoil it by having the worst exit ever. With Fidelity's web site you can put both limit orders and stop loss orders that are mutually cancelling, to bracket the possible outcomes.
So they're not letting you enter the orders, or they think you're a Pattern Day Trader?
Got in yesterday at the end of the day believing it will be a great purchase price as we look backward in 12 - 18 months. I agree with 80% of the negative on this board, I hope the other 20% doesn't come to pass.
Wow. I thought I liked WFC at $20 ... particuarly when it was in the low $30s. Now I don't know if I'm ready to the pull the trigger. It might be tastier at $17.
I believe PCA said he thought the markets would go higher but also warned about a support level which if not maintained meant we would be taking a nasty turn down. I think he got that part right, hopefully he bet that way.
We consider here estimation of a fully Gaussian latent trait model. "Fully Gaussian" means that both the latent trait and measurement error are assumed to be normally distributed. This model, equivalent to what Item Response Theory (IRT) terms a two-parameter normal (2PN) model with a normally distributed latent trait, is often used in educational testing, social science research, and, increasingly, in health research. It is also useful--perhaps one of the best methods--for binary data factor analysis.
Buffet not leaving a penny for his grandchildren... saw one woman interviewed on Oprah and boy was she pissed. Working as a cleaning lady for rich people.
karelian | 11.21.08 - 11:41 am | #
NO ONE is entitled to an inheritance, except for a spouse.
And if you are wealthy, it is best to make gifts while you are still alive. Don't wait until you are dead to distribute your wealth to those you'd like to share it with.
I have seen some truly, truly crappy estate battles.
"Flight to quality?" Why would anyone move money from stocks into treasury bills in this climate? You might as well just put the money in your mattress. Or is there some way of making money through them other than the zero interest they pay? No way to put large quantities of money anywhere else (other than a bank which isn't risk free now)? I guess I'm ignorant about finance, though it's fun to follow right now.
30y swaps moved even more than the long bond yesterday so I'll guess some activity there was driving the action. EHP popped in yesterday and said Citi had to unwind an SIV and that was driving the insanity in the bond market, as well as Citi's fall. Can you imagine the losses covering a major short on 30-year swaps at 2.8%?
And if you are wealthy, it is best to make gifts while you are still alive. Don't wait until you are dead to distribute your wealth to those you'd like to share it with.
Well, it depends...
The adjusted basis for gifts is the donor's basis. The adjusted basis for inheritances is (generally) the FMV at time of the bequeath.
Of course, I'm sure YLSP has a different take on it...
It is possible for a tetrachoric correlation matrix to not be positive definite. Knol and Berger (1991) suggest that, with ML or Generalized (Weighted) least-squares (GLS/WLS) estimation of the common factor model, if the matrix is indefinite or ill-conditioned with respect to inversion, a smoothing procedure is required; they also describe a procedure for this.
Re: "Flight to quality?" Why would anyone move money from stocks into treasury bills in this climate?
Because the value of money has been over valued to a point where stocks and bonds have compounded an error that has triggered deflation; any money you place in the black hole will evaporate!
Argggg, Maties! Here's what shell-shocked financiers are laughing at on Wall Street Friday morning in a phony Bloomberg story:
Somali Pirates in Discussions to Acquire Citigroup
By Andreas Hippin
November 20 (Bloomberg) -- The Somali pirates, renegade Somalis known for hijacking ships for ransom in the Gulf of Aden, are negotiating a purchase of Citigroup.
The pirates would buy Citigroup with new debt and their existing cash stockpiles, earned most recently from hijacking numerous ships, including most recently a $200 million Saudi Arabian oil tanker. The Somali pirates are offering up to $0.10 per share for Citigroup, pirate spokesman Sugule Ali said earlier today. The negotiations have entered the final stage, Ali said.
"You may not like our price, but we are not in the business of paying for things. Be happy we are in the mood to
offer the shareholders anything," said Ali.
The pirates will finance part of the purchase by selling new Pirate Ransom Backed Securities. The PRBS's are backed by the cash flows from future ransom payments from hijackings in the Gulf of Aden. Moody's and S&P have already issued their top investment grade ratings for the PRBS's.
Head pirate, Ubu Kalid Shandu, said: "We need a bank so that we have a place to keep all of our ransom money. Thankfully, the dislocations in the capital markets has allowed us to purchase Citigroup
at an attractive valuation and to take advantage of TARP capital to grow the business even faster."
Shandu added, "We don't call ourselves pirates. We are coastguards and this will just allow us to guard our coasts better."
"It is possible for a tetrachoric correlation matrix to not be positive definite. Knol and Berger (1991) suggest that, with ML or Generalized (Weighted) least-squares (GLS/WLS) estimation of the common factor model, if the matrix is indefinite or ill-conditioned with respect to inversion, a smoothing procedure is required; they also describe a procedure for this."
Just get a flux capacitor and a used Delorian and find out for sure.
Kona writes:
It is possible for a tetrachoric correlation matrix...
Kona | 11.21.08 - 11:54 am | #
Computer programs, mathematical models: garbage in, garbage out.
I'm not an expert on anything, but my education was in math and I spent some time trying to understand its relationship to "reality". My guess is that whatever you're trying to do is self-delusional: lies in, lies out.
So people really don't believe we are gonna see a 6 handle? Interesting. I set my Ultrashort stops really low and am thinking about adjusting them. It's national "stop out the stoneless" day...
But no way am I in SKF or SRS since my entrance was late.
I'm telling yah, Treasury has screwed up the yield curve and destroyed the value of money, thus everything is overvalued to a point where deflation has been triggered. The amount of over-valuation is obviously difficult to determine, but if GDP has been over-stated and if bonds have been over-valued and if stocks are over-valued, there probably is a base point of fundamental reality, or a point at which the yield curve and value of money was not as distorted -- when you friggn find that point, you find a bottom. Until then, zero confidence and valuation decoupled from reality.
FYI: Thus, when the data on observed items/indicators are non-normal and non-continuous (e.g.,dichotomous, ordinal/polytomous categories), the use of product-moment correlations is inappropriate (Jöreskog, 1990), yielding large negative biases in their estimates (see Carroll,1961; Lord & Novick, 1968). It should be noted that, in general, SEM techniques (includingconfirmatory factor analysis) assume that the observed data are quantitative variables measured, at least approximately, on an interval scale, and whose distributions are approximately multi-normal. In most psychosocial research applications, however, the observed variables are typically non-normal and/or of mixed response types: categorical, ordinal (Likert-type ratings)and continuous. Under such circumstances, the use of ordinary product-moment correlations isnot appropriate (see Healy & Goldstein, 1976). Instead, tetrachoric (dichotomous withdichotomous) polychoric (ordinal with ordinal) 6 and polyserial correlations (continuous withordinal) should be computed, and the correct asymptotic covariance matrix of such correlationsshould be analyzed by the method of Weighted Least Squares (WLS), using PRELIS (Jöreskog& Sörbom, 2002a). Failure to do otherwise can lead to gross errors in correlation estimates, distorted parameter estimates, and incorrect goodness-of-fit measures and standard errors (Huba & Harlow, 1987; Jöreskog & Sörbom, 1989, 1994, 2002b).
The problem with the C seems to be their liabilities and the toxic waste
The Prop desk bloke told me "If folks cant pore over BS and LEH books and come to a conclusion of the amount of toxic waste...how can they do the valuation for C. Its an accounting impossibility"
Re: "My guess is that whatever you're trying to do is self-delusional: lies in, lies out."
I agree 100% but would add that Treasury distortion is based upon that same logic and they tried to fit data into a manipulated curve which is inaccurate.
Thanks for your reply. I justa called Fidelity, my company doesn't offer brokeragelink.
That's too bad. My Fido has a 401k option that's mostly Treasuries, so I have it in that for now. I'm working on hooking up brokeragelink for more options.
OT, with my gamblin' money I just bought 50 Dec. 08 URE calls @ .40. High risk, potentially high reward bet on a snap-back / short squeeze on the SRS moon shot.
Kona, you should write this up in a LaTeX file and submit it to the American Mathematical Monthly. Or Psychometrika. Seriously.
merciless | 11.21.08 - 12:12 pm | #
Thanks for posting. When this type of thinking becomes commonly accepted we might see a bottom. We might also have much bigger problem than we do now, since no one will want to invent their money in rigged games.
Just read on another financial blog that what's going on is a "flight to liquidity" panic, in particular, liquidity outflows from the stock market.
Wearing my accountant hat (and I am an accountant), this doesn't make sense. It's like a one-sided entry, the argument assumes there are only sellers, not buyers.
Let's say A panics and sells #y of shares to B for $x. That doesn't mean that $x has left the equity markets, or that $x in market cap. has "vaporized." There still exists #y of shares and $x in the economy - all that's happened is that 2 assets, money and shares, have traded hands to satisfy differing preferences between the buyer and seller. The buyer has a greater preference for the shares than the seller, and seller a greater preference for cash.
This is not deflation, this is asset transfer. This doesn't mean that wealth has been destroyed, or that collectively the economy is worse off.
But what is changing now in the collective economy, is all the additional liquidity that's been created globally to get nominal valuations for trades higher. That additional money will eventually accomplish that, but it will be an artificial market adjustment, some will cheer the rise in nominal valuations without accounting for changes in relative value, but we'll all be worse off as a result.
Let's say A panics and sells #y of shares to B for $x. That doesn't mean that $x has left the equity markets, or that $x in market cap. has "vaporized."
Only problem is that third-party Z's portfolio is based on panic price $x, and now Z gets a call from Mr. Margin...
REBear, it means that I paid .40 each for the right to buy 5000 shares of URE at $5 when the options expire on December 20. Of course, the value of the options also changes as the ETF goes up and down.
Worst case scenario, URE price stays below $5 from now until December 20 and I'm out about $2k. Upside is considerable. Not a strategy for the faint of heart.
Nordstrom's same store sales down 11%. That's got to hurt. I'm sure some panic moves are being made there. Luckily for Nordstromthe second half recovery is only 7 months away.
Luckily for the rest of us this is an isolated matter.
I see five signs of weakness in this mini bull rally:
C
GM
F
Small-cap U.S.
Strength of gold
Interesting that there's a flight to quality in U.S. (away from small cap) but not in emerging markets. Big divergence between EEV (down) and TWM (up).
Which makes sense if the market is finally waking up to the fact that the U.S. is the real problem.
"the standard deviation of the change in yield to maturity in a given time span is
the square root of the time span times the annualized standard deviation of
the change in yield to maturity"
Since by definition an estimate is only an ap-
proximation to reality, the distribution at the investment horizon cannot be
precise. In fact, the farther in the future the investment horizon, the larger
the effect of the estimation error. We discuss estimation risk and how to cope
with it extensively in the third part of the book.
Oh shit... does anyone have a copy of Attilio Meucci - Risk and Asset Allocation? I need the third part of this and I fuc-ing want it before XMAS!!!
"It is possible for a tetrachoric correlation matrix to not be positive definite. Knol and Berger (1991) suggest that, with ML or Generalized (Weighted) least-squares (GLS/WLS) estimation of the common factor model, if the matrix is indefinite or ill-conditioned with respect to inversion, a smoothing procedure is required; they also describe a procedure for this."
"Umm, doesn't GM make just the product he needs? Way I figure, Detroit to DC is 8-9 hrs. AND you get to pass by some lovely OH and PA scenery."
I find it hard to imagine that a chauffeur would be more expensive than a pilot. Perhaps an nice Escalade tricked out with a business exec package. Or a private rail car...
Scary! I think the smartest thing to do right now is to move as much cash as you can into high-yield savings accounts at institutions like ShoreBank (Chicago), where capital is directed to projects with an environmental & redevlopment focus. There is major long-term growth in green technology, and ShoreBank (in operation for over 30 years) is doing well despite the downturn. I work with ShoreBank promoting their High-Yield Savings Account, which offers a 3.5% APY, FDIC-insurance, and online/phone tools. It's one of the highest paying savings accounts in the US. Learn more by googling "shorebank direct."
Pig power!
Nemo!
1steth
First? The old fashion way too...
Damn pig!
Fourtho
tbt or not tbt
Bronte Capital: Sheila Bair and seizing Citigroup
Pig Ping!
I was about to post this in the last thread where there was some green tech discussion...
Sustainable energy technology is exactly what the big new re-investment area needs to be. Wind and solar thermal can already be competitive with fossil in some places.
Hydro and nuclear are also sustainable energy technologies which should be expanded.
A/C and heat are not large energy sinks compared to motive power, and so do not kill the viability of plug-in electrics. It's silly to dismiss the whole arena because some ancient prototype didn't work well. Check out Better Place | The global provider of electric vehicle services for a realistic comprehensive electric car vision that is getting real traction in several locales--Israel being in the lead.
I'm no fan of government boondoggles, but a useful approach could be for the gov to put in tax mechanisms that put a price floor on fossil-based energy, so that investment can proceed in green tech with less risk.
A refreshing read....
Goldman, GE, GM Invite Us to Play a Rigged Game: Jonathan Weil - Bloomberg.com
Is Citi going to get a Lehman burial or Bear Stearns burial?
The flight away from corp paper is stunning. But, our friend Warren sees some value here....so
It's just me or DOW leg is going down?
Jason,
Thanks for your reply. I justa called Fidelity, my company doesn't offer brokeragelink.
Is Citi going to get a Lehman burial or Bear Stearns burial?
No burial. Shotgun marriage.
The Baltic Dry, at 836, continues to slither downward (-11 from yesterday), though not quite at the low (810's) it was at a few weeks ago.
(Although honestly I have no idea what range of volatility really means anything for this index...)
tbt or not tbt
I did, FWIW.
I might also finpx a smaller amount, but I don't have my head around the TIPS issues yet. See my question in the last thread.
Just an engineer,
As I said niche markets. You can't argue with BTU's.
Hey, I like golf carts, but John and Sally want a car that is at least 80% similar to what they have been driving for the last 20 years. Remember the Canadian toilet smugglers??
No way, no how, do we have enough time to explore niche markets, economically or practically.
Just sayin'.
Daily tongue twister:
Ted fed spread,
tarp zirp pork.
Fresh off the press:
FL's October revenue numbers:
http://edr.state.fl.us/reports/newsletters/nloct08.pdf
Fugly!
Engineer:
Thanks for clarity.
Don't know if Fisker or Tesla, as boutique operations, will succeed in scaling up. But at least they end the gokart meme.
Peak VT:
You did? Not that I'm looking for consensus treasuries here, but would value your thoughts.
Until Hanky and Bernanke get the boot it will only get worse.
Where are the ratings agencies? This is about the time they clue in to the obvious and downgrade something prominent. C is ripe for this.
Who is frazier and why do people keep telling him to go dow
Hoopajoops LTD writes:
Who is frazier and why do people keep telling him to go down
Hoopajoops LTD | 11.21.08 - 10:34 am | #
Joe "Smoking" Frazier
Google may help
I, for one, mourn the death of our friend Nemo. May he rest in peace.
All of these so called improvements are fake because they are financed by the US taxpayer, who is going down the shitter at the moment, while AIG and GS execs fly around in their corporate jets.
CR,
The amazing day in the long bond market has to have something to do with the now certain death of Citigroup. What, exactly, I am no expert to be able to describe. Maybe someone here can puzzle it out.
Are we going to see a rally after every 10% drop?
http://dshort.com/charts/bears/four-bears-large.gif
Is Citi going to get a Lehman burial or Bear Stearns burial?
Burial at the old 'Bank Cemetry' will bring it back to life..!
*PRES. ELECT OBAMA OFFERS TREASURY TO JOE FRAZIER
you know what's weird? There aren't any clips of Cosell calling Frazier on Youtube. Odd.
Buffett is basically selling the future index at current levels in a trade with insurance companies that want a backstop for their annuities. If Berkshire loses AAA, they will have to put up collateral. Grandma Goldie , of course, is not AAA. This might explain with the recent Government Sachs 'shrinkage'.)
From MSN:
Shares of Warren Buffett's insurance holding company are on the ropes this month, plunging 30% in part because the famed investor dabbled in an area of the market he has long publicly derided: derivatives. And due to a tangled web of financial relationships, they may be taking Goldman Sachs shares down with them.Investors are concerned about a $37-billion bet that Buffett made last year that U.S. and world equity values would be higher in 15 to 20 years than they were then, when the Dow Jones Industrials were trading around 13,000. Through his firm, Berkshire Hathaway, Buffett sold option contracts, known as "naked puts" to an undisclosed group of investors for around $4.85 billion, reportedly using Goldman as broker. The buyers saw the puts as a type of insurance that would pay off royally if stocks fell over the next decade. They were seen by Buffett as an easy way to pocket a quick $4 billion-plus, which was booked much like an insurance premium, even though he is famous for scoffing at derivatives as "weapons of mass financial destruction."But easy money is the worst kind. The problem is that stocks worldwide have gone downhill in a hurry, and with a lot of the sort of volatility that makes put contracts swell in value. And due to accounting rules, this has made Buffett already need to mark down a $6.7 billion loss on the trade even though the trade has another 14 years to work out. Because of its solid-gold credit rating, Berkshire Hathaway was not required to put up collateral to make this trade. But now rumors are flying on Wall Street that the owners of the contracts have demanded that broker Goldman Sachs put up collateral for the rest of the amount due. Since the value of the trade could be enormous, the collateral demands are said to be very large, and fears that Goldman will struggle to make good on its obligation has panicked shareholders.Indeed one theory making the rounds this week is that Buffett put $5 billion into Goldman at around $125 per share in September not as an investment but to help provide funds for the collateral.
Stock fizzle, my nizzle.
Dow down 120-180 for the day. Can i get a what! what!.
is there something wrong with QID? it doesnt track today.
*FRAZIER ACCEPTS TREASURY, SAYS "I'M GOIN NASDAQ!"
I am a baaaad ma
burnside - I think there will be inflation. Deflation may come first, but in the end the Fed will print. (This is obviously a highly debated point, so everyone please don't flame me.) But! (there always is) I realize TBT will have a significant downside if deflation comes first, since it is 2x. Now I am looking for a point to enter USO sometime soon. Note that I am NOT a trader, or a god like rich. Disclamers: IMHO, TINFA, IANAL, YMMV.
0 is approaching
I think frazier should be the official spokesman for hoopajoops.
[Is Citi going to get a Lehman burial or Bear Stearns burial?
REBear ]
Neither. AIG is the model. Cryogenics as the organs are put on ice in the Treasury for later sale
Couldnt go negative. May be a 500+ day....
Vintage Camaro SS! Subtitle genius.
YouTube - Real Estate Downfall
Apologies if already posted.
uh, CNBC commenter just had a reference to Samali pirates. Was that unique to this forum, or was it used by the MSM yesterday?
Might want to add Gold to the credit crisis indicators.
wow. My TA studies tell me the Dow is trading in the "broken window glass" pattern.
[Is Citi going to get a Lehman burial or Bear Stearns burial?
REBear ]
Actually, I was hoping for a vampire kind of burial - head cut off, stake through the heart, buried face down in running water kind of deal.
If not Citi, could we at least do this to Captial One?
General Motors Corp said on Friday it will return two leased corporate jets.
time, but sensitive to issue-spokesman
Peak VT:
That's precisely as I see it subject, as always, to fresh developments.
Have also looked into USO and KOL, but am easing into them. No serious commitment yet.
mal writes:
you know what's weird? There aren't any clips of Cosell calling Frazier on Youtube. Odd.
But for 2.99 you can have the ringtone
Howard Cosell: Down goes Frasier down goes Frasier, sound effects search, film sound effects, clip files
...."Hey, I like golf carts, but John and Sally want a car......"
John & Salli in their older years don't actually mind the dry heat of Nevada AND the actual golf cart they use for most trips into town once a week (12-miles R/T)
Citigroup's Pandit Doesn't Plan to Break Up Company
Citigroup's Pandit Doesn't Plan to Break Up Company (Update4) - Bloomberg.com
...(it's an hour faster than the damned horse)...
Re: Cosell's "Down goes Frazier" call
YouTube -
at about the 28 sec mark.
End The Fed Network - Sound Money for America! Support HR 1207, S.604 and HR 833!
The US stock markets have finally found Nirvana. They are accepting the bad news.
But during the collapse and confusion, money interests ran for the dollar and US treasuries. They ignored the leftist leanings of the US government, yes; even Bush was left of center, though few would recognize the fact.
Now the US is going full left, congress and the administration, at a time when the US is more broke than ever before.
The next markets to watch are the dollar and treasuries.
And gold. While many see gold as a recent disappointment, the fact is it is doing better than the dollar, oil and stocks.
As the leftist (one can not separate politics from economics and is a fool to try) US government spends and further destroys its currency and treasuries, gold will soar.
The stock markets have officially handed the baton to gold.
Ministry of Truth writes:
General Motors Corp said on Friday it will return two leased corporate jets.
Ministry of Truth | 11.21.08 - 10:50 am
For real? Link?
I'm so glad that they are willing to scale back some for their 25 billion USD aid. How exactly did they expect that show to go? Was it so bad that it was scripted that way?
Better yet, is it really so bad that they will cut back on executive perks??
time, but sensitive to issue-spokesman
I suggest a '69 Z-28 or a '71 Monte Carlo
burnside - UNG as well. FSNGX did well for me 2004-2007. The latter is now below my previous entry point, but it is stock-focused. Counterparty vs. equity risk. Dithering.
Well, driving instead of flying from Detroit to Washington could be way more interesting.
At least for me, as I've never been to US.
"Burial at the old 'Bank Cemetry' will bring it back to life..!
Anonymous | 11.21.08 - 10:38 am |"
Sometimes, deads better.
Nostrovia,
just a note on Buffett:
This isn't Buffett making shrewd investments. This is attempted altruism. He believes that his role is to try, despite the circumstances, to save the system which made him very wealthy.
Viewed with that lens I'd run away from anything he is pouring money into.
Anonymous writes:
I suggest a '69 Z-28 or a '71 Monte Carlo
Anonymous | 11.21.08 - 10:58 am
I wonder when was the last time Mr. Wagoner rode in a good ol' blue collar GM car...
Thought maybe we'd get a bounce this am.
Yen and bonds are not indicating such.
Uh-oh.... Went negative. Bad for the market mindset - let the ugliness begin....
About time for an all weekend jam session by the fools on the hill.
Oops.
I guess all the "ops" haved been "ex'd"
yagij,
I think he should drive the competitions Pinto, and make lots of sudden stops with his left turn-signal on...
Those guys should announce their drive plans so that people with bricks and stones can line up the roads.
Cash and gold.
God(Unrated) writes:
Uh-oh.... Went negative. Bad for the market mindset - let the ugliness begin....
Yeah. Don't think they're gonna sky this one in end-of-day trade.
bank sematary, i believe
I wonder when was the last time Mr. Wagoner rode in a good ol' blue collar GM car...
I wonder when the last time Wagoner rode in a Honda or BMW was. Or a Hyundai. That brand should scare the bejeebus out of him.
sometimes dead is better... sometimes dead is better... sob...
When black friday comes,
I'll stand down by the door,
and watch the grey men when they dive from the 14th floor.
When black friday comes,
I'll collect everything I'm owed
and before my friends find out I'll be on the road....
I am on hold with Fidelity. (Their computer claims my attempts to sell today are good faith violations -- they are not).
This is a LONG wait. Every two minutes a soothing voice encourages you not to panic and sell.
...I'm the LAST one here saying CEO's make too much, but seriously - $25m to Wagoner p/yr vs. Toyota CEO of $1m p/yr and Toyota DOESN'T have its hand out. Add to that the attitude of GM - It adds up to: Screw 'em.....Have'em find their own Daddy!
Well, which is it? From Reuters:
President-elect Barack Obamas transition team is not exploring a prepackaged bankruptcy plan for U.S. automakers, officials from Obamas team said on Friday. Bloomberg News reported that Obamas transition group was exploring the option.
Hyundai
Every time I see a sharp looking new car on the road and think, "what is that?" it turns out to be a Hyundai.
Jaguars now look like Hyundai knockoffs.
I am on hold with Fidelity. (Their computer claims my attempts to sell today are good faith violations -- they are not).
What are you selling? Mutual funds?
I asked about moving money back and forth between FDRXX and FDLXX this morning, they said while there are gating restrictions on mutual funds, they do not apply to MM funds.
Ladies and gents, place your bets...
Dow up or down? Running for the exits or storming the gates getting in?
The betting window closes at 3:00
Race begins at approx 3:30.
Stoopid future traders. Don't they know the Palantír gaze only on Sauron.
Palantír - Wikipedia, the free encyclopedia
karelian,
I cut and pasted. I can't spell my way out of a wet paper sack anyway.
Nostrovia,
Down goes Mukasey!
Down goes Mukasey!
Down goes Mukasey!
BBC NEWS | Americas | US attorney general 'recovering'
"I suggest a '69 Z-28 or a '71 Monte Carlo"
Anonymous | 11.21.08 - 10:58 am | #
As long as the Z is a 302/dual quad/crossram car and the Monte is a big block,I'm cool with that...
Chris
Plantagenet writes:
Every two minutes a soothing voice encourages you not to panic and sell.
Is that not to (panic and sell) or (not to panic) (and sell)?
o.k. I see sufficient volume and downward velocity to call for a -500pt drop.
Been wrong before, will be wrong again.
That's my call.
I don't see what the big deal is. Citigroup will never hit zero if it just falls 25% per day.
As the "savage bear market rally" just doesn't seem to want to materialize, could it be that because of the ridiculous leverage and all the hedgies that "this time it will be different" and we go straight down?
Is that not to (panic and sell) or (not to panic) (and sell)?
Either way, the correct response is to both panic and sell.
Of course that Monte's a big block son. Orange black landau top. And that beautiful black leather interior
I don't see what the big deal is. Citigroup will never hit zero if it just falls 25% per day.
Nemo | Homepage | 11.21.08 - 11:14 am | #
Nemo's paradox. Has a nice ring to it, don't you think?
When do trading curbs kick in again?
Why is it I think Paulson is shorting the hell out of these markets in his personal account.
Cobra,
He should go in style. Didn't the '67 Vette have a 427?
Nostrovia,
I'm callin Black Friday!
blackhat(Unrated) writes:
o.k. I see sufficient volume and downward velocity to call for a -500pt drop.
If it breaks down hard again, I'm gonna join you. If today is a referendum on knife catching, I think the results of the vote will look clear from the noon exit polls.
Citi is down to $3.70. This is delicious. I always detested the arrogant "international octopus" with its tenacles everywhere, as it were. Now what a deserved comeuppance. I think C will beat UBS to the bottom. LOL
Why is it I think Paulson is shorting the hell out of these markets in his personal account.
Anonymous | 11.21.08 - 11:15 am | #
I have to admit: It would explain a lot.
Nemo writes: I don't see what the big deal is. Citigroup will never hit zero if it just falls 25% per day.
Are you sure your name isn't Zeno?
PPT at rescue!!!!!!!!!!!
Looks like a gold bug party
My contrarian id urges me to buy c calls.
CIRCUIT BEAKERS:
Circuit Breaker
Set at 1,100 for Q4.
Man, that market moves fast. Out of gold and back into equities
Is Smith Barney shorting the hell out of C?
Nostrovia,
CR, minor nitpick: Every day you say "The yield on 3 month treasuries increased to X from Y" and then you list two numbers, where X is smaller than Y.
Since the markets are down over 50%, can we finally agree that PPT is a stupid idea?
1968 fully loaded Impala SS 427 and a 4 speed. Deep blue metallic with the white interior
UBS a bizarre green blip.
An aside: One of the beauties of working in the financial services industry: you can screw up, be consistently wrong for months and still be employed. Better yet, you can do this with OPM. I prefer however to be able to sleep at night.
Sam Dimond,
Suhweet.
Nostrovia,
Anon is right. We do not exist.
I love the chart porn, keep it up, great work!
Anon is right. We do not exist.
PPT | 11.21.08 - 11:20 am | #
I said stupid, nothing about existence. So stoopid, that we're wasting electrons talking about it.
Peronista-
About 30 of us from one group going down to SF FED tomm..
Time for all the bloggers to go..It's to easy to write about all the ills we face, time to get away from Internet and PC and take it main stream....Good luck
Got puts on srs and skf. Doesn't the juice run out at some point?
Lee Scott, CEO of Wally World, unexpectedly announced his retirement. That's like selling at the top.
Feel sorry for the dude that's stepping into this maelstrom.
Byzantine_Ruins writes:
Set at 1,100 for Q4.
Byzantine_Ruins | 11.21.08 - 11:18 am
To get to 1,100 from 1305 would be a bad day for tech stocks, regular stocks, tech bonds, regular bonds...
Truly scary thought.
If you look at the Gold v. S&P charts, there is an inversion going on...
Pray tell, what doth thus portend
I'm home.. C(IT)i said.
"...declines in the longer yields probably suggest deflation trades."
Maybe, but evidence of deflation didn't suddenly grow worse yesterday. There was plenty of talk of negative Philly Fed price figures before they were released.
Never underestimate the power of the calendar for portfolio managers. The end of the month (end of the year for some) is just around the corner, with only two and two-half very illiquid days next week to tidy up portfolios. Duration needs are rising as yields drop, and the long bond gets you duration cheaper than anything else. That is apparently why the bond was up at the open today, while the rest of the curve was down. Mortgage desks (they still exist) also have to re-hedge when the range extends, so that a run into (or out of) long-end Treasuries gains a certain inertia in the short run. Finally, steepening trades have been popular, and when the long end began to come down, those needed to be undone. The sharp rise in CMB and corporate bond spreads also represented a big rejiggering in spread trades that would have led to the purchase of long-dated Treasuries. There were lots of largely mechanical reasons to buy the long end this week, separate from any thoughts about deflation.
Misean --
Is Smith Barney shorting the hell out of C?
They make money the old fashioned way:
Through naked shorting.
Bottom Dweller,
"If you look at the Gold v. S&P charts, there is an inversion going on...
Pray tell, what doth thus portend"
Please remain calm. The Secret Service is on the way. You will be taken to an appropriate facility to "cure" you.
Nostrovia,
SKF nearly $300 and no shares available for shorting. Tragedy.
put it Johnny
I am not having any problem with QID. This is what I have:
QID
PS UTLRSHRT QQQ\tRefresh
Last [Tick]\t99.09[-]\tChange\t 0.49
Volume\t13,268,185\t% Change\t 0.50
Day High\t101.34\tOpen\t95.54
Day Low\t93.35\tBid\t99.08
Prev Close
(11/20/2008)\t98.60\tAsk\t99.15
huge premies but absurd volatility
"He should go in style. Didn't the '67 Vette have a 427?"
Nostrovia,
Comrade Misean is Dope | 11.21.08 - 11:16 am | #
Yep. With the 4 speed and optional sidepipes the convertible ranks up there even to a die hard Ford guy...
Chris
SKF nearly $300 and no shares available for shorting. Tragedy.
You have heard of UYG, right?
Nemo,
LOLz.
Nostrovia,
This isn't Buffett making shrewd investments. This is attempted altruism. He believes that his role is to try, despite the circumstances, to save the system which made him very wealthy.
Buffett has always presented himself as long run "bullish on America". I doubt he ever expected the disaster now upon us. He opined that the credit crisis was largely past quite a while ago, only to have it return with a vengeance. All his recent purchases (IR, BNI, KFT, UNH, KMX, etc., etc.) are underwater, some very very underwater. He says he doesn't "time" the market, but I think he should have tried at least to do so. It would have saved him a few billion.
Cash and Gold
This isn't Buffett making shrewd investments. This is attempted altruism.
LMAO. Yeah right. This is buffett having his butt handed to him.
At 11:07AM: marketwarnings issues a market bottom call on November 21, 2008.
Details below. (remember levels DOW 7445, SPX 741)
MarketWarnings: dow spx stock market bottom November 21, 2008
At 11:07AM: marketwarnings issues a market bottom call on November 21, 2008.
Details below. (remember levels DOW 7445, SPX 741)
THey blew every other call. And they're gonna blow this one too. LMAO @ you.
tom, enuff already. please
At this point, I sure hope the secret service takes me away.
"Citigroup Announces Ocean-Bound Team-Building Exercise
Citigroup announced today that it will send its entire senior management along with most of its assets on a 'team building' exercise in the Gulf of Aden. 'We're just going to float around out there for a while until this all gets worked out,' a company spokesman said.'"
I'm currently working as a mad scientist on determining how much money is over valued, this may be be ugly and I return now to my hole at Yves place; anyone that wants to have fun, drop by:
Here we are again with the short-term stuff at zero:
^IRX: Basic Chart for 13-WEEK TREASURY BILL - Yahoo! Finance
As I thought about the stuff I posted last night, it seems probable that there is an overvaluation problem with money. Can that be placed into the mold of deflation or is it related to my concern that there has been fraud overstating GDP, and are those two possibilities related, i.e, if there was fraud or mistakes made to over value GDP for years, has that resulted in triggering deflation?
That seems like a good question to me, and what I'm looking at is gamma and the factor by which money has been overvalued, e.g, if the yield curve has been a model that has been increased by a factor of 1/2, what does that mean?
In terms of GDP, which used to be around $13 Trillion, how could that be related to money being overvalued.
This is over my head, but what the hell:
Tikhonov regularization is the most commonly used method of regularization of ill-posed problems. In statistics, the method is also known as ridge regression. It is related to the Levenberg-Marquardt algorithm for non-linear least squares problems.
So, the trick here is to see if this overvaluation is recent or if it has been building up ever since:
The Cox-Ingersoll-Ross model in finance is a mathematical model describing the evolution of interest rates. It is a type of "one factor model" (Short rate model) as describes interest rate movements as driven by only one source of market risk. The model can be used in the valuation of interest rate derivatives. It was introduced in 1985 by John C. Cox, Jonathan E. Ingersoll and Stephen A. Ross as an extension of the Vasicek model.
tom,
blackhat is making a bulls**t call on that bottom call. Book it.
Been buying UYG fer 3 days. Head in hand.
I am really glad we get contrarian signals posted right into the comments. Beats dredging the intertoobs for them.
Bottom calling is getting laughable...CNBC is nothing but one person after the next calling the bottom, they should put the fund mgr's YTD performance on the screen when they call a bottom - then everyone will know how wrong they have been and how hard they are "selling" just to no go hungry!
tom,
I think PCA posted that site a few weeks ago, saying the same thing.
Kinda got that call wrong by a gazillion miles.
Calling bottom again...erm OK...
Nostrovia,
Been buying UYG fer 3 days. Head in hand.
My condolences.
Plantagenet writes:
I am on hold with Fidelity. (Their computer claims my attempts to sell today are good faith violations -- they are not).
Any update Plant? Did they let you sell?
A prize fighter in a corner is told Hit where it hurts - silver and gold
blackhat versus God (over/under anyone?)
blackhat(Excellent) writes:
o.k. I see sufficient volume and downward velocity to call for a -500pt drop.
Been wrong before, will be wrong again.
That's my call.
God(Excellent) writes:
Couldnt go negative. May be a 500+ day....
PCA has been wrong on everyone of his calls...my dog picks stocks better than him.
Did no one click through on that video I posted? It's pure gold!
And I swear, it is not another Rickroll.
Someone shoot all three of us!
"marketwarnings" moron issues another bottom call.
This is like his 30th attempt, give or take.
It really is brilliant performance art, though unintentional.
Eric writes:
Plantagenet writes:
I am on hold with Fidelity. (Their computer claims my attempts to sell today are good faith violations -- they are not).
Fidelity has barred me for 6 months from buying any Fidelity funds. Best thing that happened to me this year
"What are you selling? Mutual funds?"
No, it's the QID I got yesterday at 86.23 (my bet entry ever). I am trying not to spoil it by having the worst exit ever. With Fidelity's web site you can put both limit orders and stop loss orders that are mutually cancelling, to bracket the possible outcomes. A few % either way and I'm out.
They must not have read the parable of The Fund Who Called Bottom.
I think the market "will stay the course".
Gasbag getting schooled right now.
Can we just put this douchebag in jail for spreading rumors?
Whew, for $1.00 I wanted the whole thing.
Citigroup's Pandit Doesn't Plan to Break Up Company (Update4) - Bloomberg.com
Buffet not leaving a penny for his grandchildren... saw one woman interviewed on Oprah and boy was she pissed. Working as a cleaning lady for rich people.
No, it's the QID I got yesterday at 86.23 (my bet entry ever). I am trying not to spoil it by having the worst exit ever. With Fidelity's web site you can put both limit orders and stop loss orders that are mutually cancelling, to bracket the possible outcomes.
So they're not letting you enter the orders, or they think you're a Pattern Day Trader?
What's their objection?
Got in yesterday at the end of the day believing it will be a great purchase price as we look backward in 12 - 18 months. I agree with 80% of the negative on this board, I hope the other 20% doesn't come to pass.
Eric writes:
Gasbag getting schooled right now.
Can we just put this douchebag in jail for spreading rumors?
Eric | 11.21.08 - 11:40 am | #
Details?
Details?
Leesman is convinced C is going to be taken over by the government.
Gasbag is attempting to take the other side on that debate, but blustering and stammering, without giving any facts.
LMFAO:
Lurking Silently, Ready To Pounce - Dealbreaker - A Wall Street Tabloid - Business News Headlines and Financial Gossip
(or Lurking Silently, Ready To Pounce - Dealbreaker - A Wall Street Tabloid - Business News Headlines and Financial Gossip
Eric,
Wish I could see that. Gasbag needs to have his ass handed to him.
Nostrovia,
Wow. I thought I liked WFC at $20 ... particuarly when it was in the low $30s. Now I don't know if I'm ready to the pull the trigger. It might be tastier at $17.
I am hearing reports from C's Prop Desk heads that no merger talks are happening as everyone is running away in fear
I believe PCA said he thought the markets would go higher but also warned about a support level which if not maintained meant we would be taking a nasty turn down. I think he got that part right, hopefully he bet that way.
GLD is on a mission from glod.
"Any update Plant? Did they let you sell?"
Yes, the warning message was just poorly worded.
I am having have screaming buy issues. Anyone else facing this?
Maybe this is another clue?
Estimating a Latent Trait Model by Factor Analysis of Tetrachoric Correlations
Member Center - CompuServe OurWorld
We consider here estimation of a fully Gaussian latent trait model. "Fully Gaussian" means that both the latent trait and measurement error are assumed to be normally distributed. This model, equivalent to what Item Response Theory (IRT) terms a two-parameter normal (2PN) model with a normally distributed latent trait, is often used in educational testing, social science research, and, increasingly, in health research. It is also useful--perhaps one of the best methods--for binary data factor analysis.
Buffet not leaving a penny for his grandchildren... saw one woman interviewed on Oprah and boy was she pissed. Working as a cleaning lady for rich people.
karelian | 11.21.08 - 11:41 am | #
NO ONE is entitled to an inheritance, except for a spouse.
And if you are wealthy, it is best to make gifts while you are still alive. Don't wait until you are dead to distribute your wealth to those you'd like to share it with.
I have seen some truly, truly crappy estate battles.
"Flight to quality?" Why would anyone move money from stocks into treasury bills in this climate? You might as well just put the money in your mattress. Or is there some way of making money through them other than the zero interest they pay? No way to put large quantities of money anywhere else (other than a bank which isn't risk free now)? I guess I'm ignorant about finance, though it's fun to follow right now.
PCA?! He's the greatest contrary indicator this board has. No one has been so consistently wrong with actionable information.
Fear will be peaking shortly...short fear and capitulation.
Time to Re-Leverage
what's a Prop Desk ?
@Peak -- Yes.
I am having a difficult time resisting the urge.
This from the biggest uberbear there is.
I am having have screaming buy issues. Anyone else facing this?
I ditched 1/3rd of my puts yesterday morning, and another 1/3rd yesterday at the close.
I suck at individual stock picking, but I'm beginning to think about perhaps buying a dividend based mutual fund down in here. Yields are tasty.
Still holding off, and I'd guess if we get back into the mid 800s on the SPX soon, I'll just close my eyes and reload on puts.
30y swaps moved even more than the long bond yesterday so I'll guess some activity there was driving the action. EHP popped in yesterday and said Citi had to unwind an SIV and that was driving the insanity in the bond market, as well as Citi's fall. Can you imagine the losses covering a major short on 30-year swaps at 2.8%?
You might as well just put the money in your mattress.
Exactly. But if you're a large company, mattresses are too small, so you use treasuries instead.
I'm loving my treasuries at the moment, but it might be the day to sell.
And if you are wealthy, it is best to make gifts while you are still alive. Don't wait until you are dead to distribute your wealth to those you'd like to share it with.
Well, it depends...
The adjusted basis for gifts is the donor's basis. The adjusted basis for inheritances is (generally) the FMV at time of the bequeath.
Of course, I'm sure YLSP has a different take on it...
It is possible for a tetrachoric correlation matrix to not be positive definite. Knol and Berger (1991) suggest that, with ML or Generalized (Weighted) least-squares (GLS/WLS) estimation of the common factor model, if the matrix is indefinite or ill-conditioned with respect to inversion, a smoothing procedure is required; they also describe a procedure for this.
Would anyone be closing puts on SPG or COF here?
I think they are total dogs, but maybe its time to take the profit...
But I'm having a hard time pulling the trigger....
What's up Kona?
Re: "Flight to quality?" Why would anyone move money from stocks into treasury bills in this climate?
Because the value of money has been over valued to a point where stocks and bonds have compounded an error that has triggered deflation; any money you place in the black hole will evaporate!
I see gloom and doom everywhere regarding the DOW. It seems so obvious. That's why I'm unsure
YEN is getting tired. Watch out for the rally of all rallies esp. on expiration friday. Let the fun begin.
Argggg, Maties! Here's what shell-shocked financiers are laughing at on Wall Street Friday morning in a phony Bloomberg story:
Somali Pirates in Discussions to Acquire Citigroup
By Andreas Hippin
November 20 (Bloomberg) -- The Somali pirates, renegade Somalis known for hijacking ships for ransom in the Gulf of Aden, are negotiating a purchase of Citigroup.
The pirates would buy Citigroup with new debt and their existing cash stockpiles, earned most recently from hijacking numerous ships, including most recently a $200 million Saudi Arabian oil tanker. The Somali pirates are offering up to $0.10 per share for Citigroup, pirate spokesman Sugule Ali said earlier today. The negotiations have entered the final stage, Ali said.
"You may not like our price, but we are not in the business of paying for things. Be happy we are in the mood to
offer the shareholders anything," said Ali.
The pirates will finance part of the purchase by selling new Pirate Ransom Backed Securities. The PRBS's are backed by the cash flows from future ransom payments from hijackings in the Gulf of Aden. Moody's and S&P have already issued their top investment grade ratings for the PRBS's.
Head pirate, Ubu Kalid Shandu, said: "We need a bank so that we have a place to keep all of our ransom money. Thankfully, the dislocations in the capital markets has allowed us to purchase Citigroup
at an attractive valuation and to take advantage of TARP capital to grow the business even faster."
Shandu added, "We don't call ourselves pirates. We are coastguards and this will just allow us to guard our coasts better."
"I am having have screaming buy issues. Anyone else facing this?"
PeakVT | 11.21.08 - 11:50 am
In equities?
If so, plot SPX against VWEHX & ABHIX. Wake me up when those two hicks stop cliff diving.
Would a rally in yen (say
damn haloscan.
So a rally in yen would be super bearish for US stocks right?
kona,
"It is possible for a tetrachoric correlation matrix to not be positive definite. Knol and Berger (1991) suggest that, with ML or Generalized (Weighted) least-squares (GLS/WLS) estimation of the common factor model, if the matrix is indefinite or ill-conditioned with respect to inversion, a smoothing procedure is required; they also describe a procedure for this."
Just get a flux capacitor and a used Delorian and find out for sure.
Nostrovia,
Kona writes:
It is possible for a tetrachoric correlation matrix...
Kona | 11.21.08 - 11:54 am | #
Computer programs, mathematical models: garbage in, garbage out.
I'm not an expert on anything, but my education was in math and I spent some time trying to understand its relationship to "reality". My guess is that whatever you're trying to do is self-delusional: lies in, lies out.
GH, yes but I think we saw the downside for now at 93.81. We could 97 today and have a 8% move in stocks.
So people really don't believe we are gonna see a 6 handle? Interesting. I set my Ultrashort stops really low and am thinking about adjusting them. It's national "stop out the stoneless" day...
But no way am I in SKF or SRS since my entrance was late.
"proprietary trading"-- Institution's own money.
god help me. I just placed a huge buy on UYG.
I didn't want to unwind my puts, so I'm just hedging on UGY.
CNBC just mentioned op-ex.
Can the PPT be far behind?
I didn't want to unwind my puts, so I'm just hedging on UGY.
Gavshire Hathaway | 11.21.08 - 12:06 pm | #
Not unreasonable to me.
Anonymous writes:
Argggg, Maties! Here's what shell-shocked financiers are laughing at on Wall Street Friday morning in a phony Bloomberg story:
More opinions on Citi: Citigroup Is Ruined Who Will Take Over Citi - Market Movers - Portfolio.com
I'm telling yah, Treasury has screwed up the yield curve and destroyed the value of money, thus everything is overvalued to a point where deflation has been triggered. The amount of over-valuation is obviously difficult to determine, but if GDP has been over-stated and if bonds have been over-valued and if stocks are over-valued, there probably is a base point of fundamental reality, or a point at which the yield curve and value of money was not as distorted -- when you friggn find that point, you find a bottom. Until then, zero confidence and valuation decoupled from reality.
FYI: Thus, when the data on observed items/indicators are non-normal and non-continuous (e.g.,dichotomous, ordinal/polytomous categories), the use of product-moment correlations is inappropriate (Jöreskog, 1990), yielding large negative biases in their estimates (see Carroll,1961; Lord & Novick, 1968). It should be noted that, in general, SEM techniques (includingconfirmatory factor analysis) assume that the observed data are quantitative variables measured, at least approximately, on an interval scale, and whose distributions are approximately multi-normal. In most psychosocial research applications, however, the observed variables are typically non-normal and/or of mixed response types: categorical, ordinal (Likert-type ratings)and continuous. Under such circumstances, the use of ordinary product-moment correlations isnot appropriate (see Healy & Goldstein, 1976). Instead, tetrachoric (dichotomous withdichotomous) polychoric (ordinal with ordinal) 6 and polyserial correlations (continuous withordinal) should be computed, and the correct asymptotic covariance matrix of such correlationsshould be analyzed by the method of Weighted Least Squares (WLS), using PRELIS (Jöreskog& Sörbom, 2002a). Failure to do otherwise can lead to gross errors in correlation estimates, distorted parameter estimates, and incorrect goodness-of-fit measures and standard errors (Huba & Harlow, 1987; Jöreskog & Sörbom, 1989, 1994, 2002b).
The problem with the C seems to be their liabilities and the toxic waste
The Prop desk bloke told me "If folks cant pore over BS and LEH books and come to a conclusion of the amount of toxic waste...how can they do the valuation for C. Its an accounting impossibility"
A valid Q !
Bronte Capital: Sheila Bair and seizing Citigroup
has some good points on C
Re: "My guess is that whatever you're trying to do is self-delusional: lies in, lies out."
I agree 100% but would add that Treasury distortion is based upon that same logic and they tried to fit data into a manipulated curve which is inaccurate.
Kona, you should write this up in a LaTeX file and submit it to the American Mathematical Monthly. Or Psychometrika. Seriously.
Thanks for your reply. I justa called Fidelity, my company doesn't offer brokeragelink.
That's too bad. My Fido has a 401k option that's mostly Treasuries, so I have it in that for now. I'm working on hooking up brokeragelink for more options.
OT, with my gamblin' money I just bought 50 Dec. 08 URE calls @ .40. High risk, potentially high reward bet on a snap-back / short squeeze on the SRS moon shot.
-Jaso
Kona, you should write this up in a LaTeX file and submit it to the American Mathematical Monthly. Or Psychometrika. Seriously.
merciless | 11.21.08 - 12:12 pm | #
...or JIR
Oh, if anyone cares the URE call strike price is $5.
-Jaso
merciless,
Great idea,
Maybe they already have some papers on why the 13-week Treasury is at zero!
PeakVT writes:
I am having have screaming buy issues. Anyone else facing this?
Yes, right now on emerging markets. I have a fund that I have ridden down to the bottom, hedging with EEV. I keep wanting to jump back in.
[Johnny Lee writes:
SKF nearly $300 and no shares available for shorting. Tragedy]
Always UYG, if you feel lucky!
GH, just saw your post. I went back and forth between URE and UYG - the call price was better on URE so I went with that.
We're on the same wavelength - I just sleep better if I buy the calls and pretend I just put a coin in a slot machine.
-Jaso
Bruce writes:
A refreshing read....
http://www.bloomberg.com/apps/ne...r0nw& refer=home
Bruce,
Thanks for posting. When this type of thinking becomes commonly accepted we might see a bottom. We might also have much bigger problem than we do now, since no one will want to invent their money in rigged games.
Thaksin writes:
The problem with the C seems to be their liabilities and the toxic waste.
No kidding.
Moody's lowers Somali Pirates outlook to negative
Business Week Online > File Not Found
Moody's Investors Service lowered Somali Pirates Inc.'s outlook to negative from stable, citing the retailer's third-quarter same-store sales decline.
Somali Pirates said its quarterly same-store sales fell 11.1 percent for the period ended Nov. 1.
WFC & JPM racing to $20. BAC cloning in on single digits.
There's never been a better time to buy. My RE agent is also my stock broker.
Jason,
"Oh, if anyone cares the URE call strike price is $5."
What does that mean?
thanks
Just read on another financial blog that what's going on is a "flight to liquidity" panic, in particular, liquidity outflows from the stock market.
Wearing my accountant hat (and I am an accountant), this doesn't make sense. It's like a one-sided entry, the argument assumes there are only sellers, not buyers.
Let's say A panics and sells #y of shares to B for $x. That doesn't mean that $x has left the equity markets, or that $x in market cap. has "vaporized." There still exists #y of shares and $x in the economy - all that's happened is that 2 assets, money and shares, have traded hands to satisfy differing preferences between the buyer and seller. The buyer has a greater preference for the shares than the seller, and seller a greater preference for cash.
This is not deflation, this is asset transfer. This doesn't mean that wealth has been destroyed, or that collectively the economy is worse off.
But what is changing now in the collective economy, is all the additional liquidity that's been created globally to get nominal valuations for trades higher. That additional money will eventually accomplish that, but it will be an artificial market adjustment, some will cheer the rise in nominal valuations without accounting for changes in relative value, but we'll all be worse off as a result.
oh .. i didn't read your previous post. sorry!
When GDP contracts officially, do Social Security checks get reduced instead of being increased by inflation?
romanko ,
I have to give you a long explanation but I will give you a one word explanation
VOLUME
Let's say A panics and sells #y of shares to B for $x. That doesn't mean that $x has left the equity markets, or that $x in market cap. has "vaporized."
Only problem is that third-party Z's portfolio is based on panic price $x, and now Z gets a call from Mr. Margin...
Emerging markets have not bottomed. Repeat: NOT bottomed yet.
Emerging markets have not bottomed. Repeat: NOT bottomed yet.
Agreed. They don't bottom while they're getting aid from IMF. They bottom when they are unable to pay said aid back.
REBear, it means that I paid .40 each for the right to buy 5000 shares of URE at $5 when the options expire on December 20. Of course, the value of the options also changes as the ETF goes up and down.
Worst case scenario, URE price stays below $5 from now until December 20 and I'm out about $2k. Upside is considerable. Not a strategy for the faint of heart.
-Jaso
Nordstrom's same store sales down 11%. That's got to hurt. I'm sure some panic moves are being made there. Luckily for Nordstromthe second half recovery is only 7 months away.
Luckily for the rest of us this is an isolated matter.
Wow Basel Too
You should do some GRE Analogy
EM : IMF
USA : ?
EM : IMF
USA : ?
Fed printing press?
I see five signs of weakness in this mini bull rally:
C
GM
F
Small-cap U.S.
Strength of gold
Interesting that there's a flight to quality in U.S. (away from small cap) but not in emerging markets. Big divergence between EEV (down) and TWM (up).
Which makes sense if the market is finally waking up to the fact that the U.S. is the real problem.
Volume?
For there to be $xxxxxxx volume, you still need as many buyers and sellers, no?
C retraces 10%
I think some announcement will happen in next 30 mins ?
Something going on with C.
Market knows it.
News coming.
OK, I called my Prop desk bloke...he said ..there is nothing significant happening..
just a big block deal from an asian fund
speaking of QID....sold the last bit of mine at 97.8x from entry of 41.2X
Couldn't resist...
Ciao
MS
he opines that prices will go back to below 4$ in few minutes
Thanks for the advice re: emerging markets. I will hold on that and keep with my EEV.
YouTube - Max Keiser on Alex Jones Show 081117
Metals may be the new drug of choice?
PSGirl. Check out the major indices in Shangahi, Bombay, HK and Vietnam. When you see a double or triple bottom formation you go.
Be patient. You don't have to look for a looooong time. Exports will plummet.
Put an alarm in your calendar. October 2009 is a good time to start checking.
Sure was a delayed reaction to the drop off in yen and bonds.
Do I hear the sounds of a fleet of loaded helicopter engines warming up?
Four horsemen can sound an awful lot like a fleet of helicopters.
And in closing, last night, my question was, where is the puck going and where should you be waiting:
Projecting the invariants into the future
http://www.symmys.com/AttilioMeucci/Book/Downloads/Attilio%20Meucci_RiskAndAssetAllocation_Sample.pdf
the square root of the time span times the annualized standard deviation of
the change in yield to maturity"
proximation to reality, the distribution at the investment horizon cannot be
precise. In fact, the farther in the future the investment horizon, the larger
the effect of the estimation error. We discuss estimation risk and how to cope
with it extensively in the third part of the book.
Oh shit... does anyone have a copy of Attilio Meucci - Risk and Asset Allocation? I need the third part of this and I fuc-ing want it before XMAS!!!
Ride to DC
1965 GTO
Silver w black pinstriping
Hurst Transmission
4 in the floor
"Don't buy that car for your son", the car dealer said to my Dad. "That car's a killer."
Took the 65 Impala convertible - red with leather interior.
Thanks Comrade Peronista. I put it on my calendar:)
"Been buying UYG fer 3 days. Head in hand.
Johnny Lee | 11.21.08 - 11:35 am | #"
Sold all of my 4$ puts from the straddles I set up last Friday +100%
Sure would like to see a rally to cash out the other side.
kona,
"It is possible for a tetrachoric correlation matrix to not be positive definite. Knol and Berger (1991) suggest that, with ML or Generalized (Weighted) least-squares (GLS/WLS) estimation of the common factor model, if the matrix is indefinite or ill-conditioned with respect to inversion, a smoothing procedure is required; they also describe a procedure for this."
The procedure is called a enema colonoscopy.
Ministry of Truth(Unrated) writes:
General Motors Corp said on Friday it will return two leased corporate jets.
time
Umm, doesn't GM make just the product he needs? Way I figure, Detroit to DC is 8-9 hrs. AND you get to pass by some lovely OH and PA scenery.
"Umm, doesn't GM make just the product he needs? Way I figure, Detroit to DC is 8-9 hrs. AND you get to pass by some lovely OH and PA scenery."
I find it hard to imagine that a chauffeur would be more expensive than a pilot. Perhaps an nice Escalade tricked out with a business exec package. Or a private rail car...
Scary! I think the smartest thing to do right now is to move as much cash as you can into high-yield savings accounts at institutions like ShoreBank (Chicago), where capital is directed to projects with an environmental & redevlopment focus. There is major long-term growth in green technology, and ShoreBank (in operation for over 30 years) is doing well despite the downturn. I work with ShoreBank promoting their High-Yield Savings Account, which offers a 3.5% APY, FDIC-insurance, and online/phone tools. It's one of the highest paying savings accounts in the US. Learn more by googling "shorebank direct."
Hopefully the charts will continue to look better, and not take a turn for the worse. I found this really interesting:
"Obama motivates D.C. to initiate new lower and middle class bailout"
Obama's Taxpayer Bailout