tag:blogger.com,1999:blog-34323687.post492004164967044402..comments2024-03-29T12:26:35.581+00:00Comments on Macro Man: Dislocation, Dislocation, DislocationMacro Manhttp://www.blogger.com/profile/12324967552369915949noreply@blogger.comBlogger34125tag:blogger.com,1999:blog-34323687.post-82584583638177948852008-10-10T14:17:00.000+01:002008-10-10T14:17:00.000+01:00@ Anon. 1103http://www.derivativesstrategy.com/mag...@ Anon. 1103<BR/><BR/>http://www.derivativesstrategy.com/magazine/archive/1995-1996/1195qa.asp<BR/><BR/>I was a little off on the quote (good thing I'm not a market maker) but the ideas was right. Anyway, you might enjoy the article.Anonymousnoreply@blogger.comtag:blogger.com,1999:blog-34323687.post-84510265919112121122008-10-10T07:58:00.000+01:002008-10-10T07:58:00.000+01:00The cover on the magazine is one signal that panic...The cover on the magazine is one signal that panic becomes omnipresent. Another one I observe is when the best/biggest stock give in.<BR/>A list of the DJIA stock shows that lately this has been the case. <BR/>http://finviz.com/screener.ashx?v=211&f=idx_dji&ft=1&ta=0&p=w&o=ticker&r=1<BR/>I doubt the CDS settlement will change anything. It will go well, but the market knows it's only for appearances. Hide what you can still hide!Anonymousnoreply@blogger.comtag:blogger.com,1999:blog-34323687.post-17260717640627440142008-10-10T07:21:00.000+01:002008-10-10T07:21:00.000+01:00I would not be suprised if G7 would shut down exch...I would not be suprised if G7 would shut down exchanges globally, or introduce a tobin tax, or change any other rule we take now for granted.Anonymousnoreply@blogger.comtag:blogger.com,1999:blog-34323687.post-5070732459881185732008-10-10T01:59:00.000+01:002008-10-10T01:59:00.000+01:00MM, some advice please. My wife and I are US resid...MM, some advice please. My wife and I are US residents, self-employed, looking to move abroad for 5-10 years and then returning. Given our time frame what 3 countries would be your top destinations as a currency trade?Anonymousnoreply@blogger.comtag:blogger.com,1999:blog-34323687.post-66526264818338329772008-10-09T23:48:00.000+01:002008-10-09T23:48:00.000+01:00What are the VOW GR/VOW3 GR? Common/preferred? Jus...What are the VOW GR/VOW3 GR? Common/preferred? Just guessing.Anonymousnoreply@blogger.comtag:blogger.com,1999:blog-34323687.post-49281989558050086852008-10-09T23:03:00.000+01:002008-10-09T23:03:00.000+01:00"don't trade anything you can't price yourself in ..."don't trade anything you can't price yourself in Excel"<BR/><BR/>LOL - I priced everything in the beginning in Excel (with exotic pricers coded in C via DLL)...<BR/><BR/>Ask the Japanese exporters and insurers (if they actually survived) who sold chained KI $calls in the latter part of 1990's..."hurdles" we called them - they were like current-day US Treasury's printing machine for the desk....$$$Anonymousnoreply@blogger.comtag:blogger.com,1999:blog-34323687.post-20480446509648174622008-10-09T22:48:00.000+01:002008-10-09T22:48:00.000+01:00SANITY WHERE ARE YOU??SANITY WHERE ARE YOU??mikarskyhttps://www.blogger.com/profile/07451575916097736038noreply@blogger.comtag:blogger.com,1999:blog-34323687.post-12098004626496875192008-10-09T21:47:00.000+01:002008-10-09T21:47:00.000+01:00There was a nice quote in Derivatives Strategy mag...There was a nice quote in Derivatives Strategy magazine many years ago to the effect of "don't trade anything you can't price yourself in Excel". Corporates might do well to pay attention to that (e.g. United, who hedged out their short jet fuel exposure in 2Q08 and sold $107 strike knock in CL puts as part of the hedge. Doh...)Anonymousnoreply@blogger.comtag:blogger.com,1999:blog-34323687.post-6530692953935489322008-10-09T21:31:00.000+01:002008-10-09T21:31:00.000+01:00Yes ... There are talks that another big company ...Yes ... There are talks that another big company is going to announce losses .. It is a closed company .. But loss would be humungous ...Anonymousnoreply@blogger.comtag:blogger.com,1999:blog-34323687.post-55497207568066689842008-10-09T21:18:00.000+01:002008-10-09T21:18:00.000+01:00Zman, yes, there have been some truly horrific sto...Zman, yes, there have been some truly horrific stories of the TARN structures in Brazil and, to a slightly less extent, Mex. Just filthy. Kinda like this equity market, which I have to confess has surprised me with its horribleness. I've slashed short equity risk and feel naked...Macro Manhttps://www.blogger.com/profile/12324967552369915949noreply@blogger.comtag:blogger.com,1999:blog-34323687.post-71034167143889650772008-10-09T21:01:00.000+01:002008-10-09T21:01:00.000+01:00EM - are you talking about Knock-In $calls embedde...EM - are you talking about Knock-In $calls embedded in the structures that MXN/BRL exporters sold?<BR/><BR/>zmanAnonymousnoreply@blogger.comtag:blogger.com,1999:blog-34323687.post-11311918784369718342008-10-09T20:13:00.000+01:002008-10-09T20:13:00.000+01:00G7 to act to stave off worldwide financial ruinAlr...<I>G7 to act to stave off worldwide financial ruin</I><BR/><BR/>Already been there, already done that.<BR/><BR/>You just can't fix stupid with rate cutsAnonymousnoreply@blogger.comtag:blogger.com,1999:blog-34323687.post-1549796727311789802008-10-09T19:49:00.000+01:002008-10-09T19:49:00.000+01:00Just read a Reuters article that led off with a re...Just read a Reuters article that led off with a reference for the G7 to act to stave off worldwide financial ruin. Has it come to that? Thanks for hanging in with your readers, MM. Your blog is the first thing I turn to in the morning.Anonymousnoreply@blogger.comtag:blogger.com,1999:blog-34323687.post-26196663275310711502008-10-09T17:45:00.000+01:002008-10-09T17:45:00.000+01:00Mr. MM .. First of all I would like to congratulat...Mr. MM .. First of all I would like to congratulate for your amazing blog ... Really insightful .. Well , just a quickie on what happened to the freaking MXN yesterday ( and same dynamic has been playing out in BRL , as well, for the last few sessions ) ... Pretty much lots of exporters were enticed by eager salesmen to join highly leveraged options trades .. In a nutshell , what was underneath all BS and cutes names was a sweetneer where they would sell high strikes dollar calls .. In other words ,they were the improving the average of their exports while selling the upside naked.. Pretty much they believed that MXN and BRL would be forever trading down towards 0 .... For their amazement they found out thru a very painful experience that CCys trade in both ways .. So they lost fortunes and there was a huge run after the lost vol ... Just for the record , in Brazil Aracruz announced that lost USD 1 bio in fx exposure , Sadia lost $ 400 mio and so on .. I hope that helps ... CheersAnonymousnoreply@blogger.comtag:blogger.com,1999:blog-34323687.post-83203783126794609552008-10-09T17:30:00.000+01:002008-10-09T17:30:00.000+01:00Libor rates:Nothing moves today because of stupid ...Libor rates:<BR/><BR/>Nothing moves today because of stupid decisions made months ago.<BR/><BR/>When you see as the Times reports that Westminster, Kent and other counties had £ millions deposited with Icelandic banks. People managing cash were happy to earn 50 bps more on a deposit at an Icelandic than say at HSBC when the CDS spread between those banks and HSBC was 500 bps !!!!!!!<BR/><BR/><BR/>All these stupid mistakes made by people who had no clue lead to todays situation. You go from zero risk analysis to 100% paralysis ...Anonymousnoreply@blogger.comtag:blogger.com,1999:blog-34323687.post-55842966804280496422008-10-09T15:46:00.000+01:002008-10-09T15:46:00.000+01:00if we have USD libor and european banks paying 7% ...if we have USD libor and european banks paying 7% for 1m and turn USDs despite all the TAF, CP facility, coordinated rate cuts, etc, what happens when the central banks try to wean the markets off all these facilities in 6 months? Something tells me the "facts have changed". Will be interested to see all the unintended consequences engendered by all this. Who would have thought money market and USD IRS trader would be the best seat on the Street a couple years ago? My oh my how USD liquidity was mispriced...Anonymousnoreply@blogger.comtag:blogger.com,1999:blog-34323687.post-71805885538398154752008-10-09T15:08:00.000+01:002008-10-09T15:08:00.000+01:00ive a 1% short position in VW ords. pretty much s...ive a 1% short position in VW ords. pretty much spent all day tuesday starring at the VOW GR chart in complete amazement. i was down 70% at one point.<BR/><BR/>seems like a no brainer to me. i can wait more than 5 mins to make $...prophetshttps://www.blogger.com/profile/16688051502761732148noreply@blogger.comtag:blogger.com,1999:blog-34323687.post-53842055133971978972008-10-09T14:57:00.000+01:002008-10-09T14:57:00.000+01:00they are going to end up backing Libor with U.S. g...they are going to end up backing Libor with U.S. govt dollars. It is going to happen relatively soon.<BR/><BR/>This might be through some nationalizations, but I think they are going to go farther than that and actually back Libor from people that can prove solvency. The ones that can't prove solvency will be left out of the market - then they forced into bankruptcy because they are out of the market, and then they will be nationalized. Circular, but realistic knowledge.Anonymousnoreply@blogger.comtag:blogger.com,1999:blog-34323687.post-59446101635059562282008-10-09T14:47:00.000+01:002008-10-09T14:47:00.000+01:00Well, a global coordinated cut of already heavily ...Well, a global coordinated cut of already heavily subsidized central bank rates has managed to drive Libor EVEN HIGHER<BR/><BR/>And now Paulson wants other countries to follow his bone headed policies -- and he is mad as hell that only Japan and Europe voiced any support (Japan already having made the mistakes 15 years earlier)<BR/><BR/>I don't see a market bottom until after the election -- as long as these clowns are "in charge", extreme caution is the only course you can takeAnonymousnoreply@blogger.comtag:blogger.com,1999:blog-34323687.post-62318980873484737612008-10-09T13:53:00.000+01:002008-10-09T13:53:00.000+01:00sundblad, the Fed paying interest on reserves allo...sundblad, the Fed paying interest on reserves allows them to turn on th monetary spigot without driving FF below target.<BR/><BR/>Humble student, 3.8670 is what I see. I am keeping my mind and options open in terms of what any rally might look like. The bear market standard has been 6-10 weeks in this cycle, so I'd look for something similar. It's still a bear market, though.<BR/><BR/>Arnold, NR's contention was that the yen carry trade amounted to a trillion dollars and would bring fire and brimstone to all who touched it. Speaking only for myself, there was good money to be made in the carry trade last year, and there was plenty of time to get out and even short for anyone with their eyes open.Macro Manhttps://www.blogger.com/profile/12324967552369915949noreply@blogger.comtag:blogger.com,1999:blog-34323687.post-73599263442383990832008-10-09T13:38:00.000+01:002008-10-09T13:38:00.000+01:00MM was correct. Roubini was wrong to say that Yen ...MM was correct. Roubini was wrong to say that Yen carry unwind would be catastrophic.Anonymousnoreply@blogger.comtag:blogger.com,1999:blog-34323687.post-54891484311326252892008-10-09T13:17:00.000+01:002008-10-09T13:17:00.000+01:00Hey, Macroman, didn't you write a post called Nour...Hey, Macroman, didn't you write a post called Nouriel Roubini is a big fat idiot. I wonder who looks like the idiot now?Anonymousnoreply@blogger.comtag:blogger.com,1999:blog-34323687.post-30265067434498312892008-10-09T13:14:00.000+01:002008-10-09T13:14:00.000+01:00Sorry for steering offtopic. Could anyone with a b...Sorry for steering offtopic. Could anyone with a bloomberg tell me what was the low of EUR/RON for yesterday? pls! your help will be much appreciated.<BR/><BR/>as a side note:<BR/><BR/>MM, you said that in this market its sentiment that matters. Do you believe that an improved sentiment right now will just prolong the pain and will set up the risk assets for a vicious fall after a short-lived rally? if the rally is only sentiment-based and not based on the real issues improving (like deleveraging imho) will it not generate a steeper fall and then even more panic?<BR/><BR/>Thanks a 1000 times for your most insightful blog!<BR/><BR/>humble studentAnonymousnoreply@blogger.comtag:blogger.com,1999:blog-34323687.post-46782334994996355002008-10-09T12:27:00.000+01:002008-10-09T12:27:00.000+01:00Here's a question: a few days ago, the Fed said it...Here's a question: a few days ago, the Fed said it would start paying interest on deposits. Will this not make the banks even more reluctant to lend to each other, when they can earn interest at the Fed instead?Anonymousnoreply@blogger.comtag:blogger.com,1999:blog-34323687.post-80173385412726456832008-10-09T12:19:00.000+01:002008-10-09T12:19:00.000+01:00Everyone looking for a bottom, calling fro a bounc...Everyone looking for a bottom, calling fro a bounce and more then likely they will all be wrong. Seems to be how it works in the real world.Anonymousnoreply@blogger.com