More to the point, is that now that CDS have shown themselves to have no value whatsoever in terms of credibility, how will that affect investors in sovereign (read peripheral europe) debt?
I doubt they will touch it (unless at extreme spreads against bunds) and why should they? If contracts can be unilaterally abrogated and any insurance they could buy on such investments is not to be trusted, then the whole issue of funding growth in the troubled euro area just got harder, not easier with this whole deal. That is, unless the ECB thinks it can print the money that private investors would have otherwise provided. You know they are going to try...
Just want to add my thanks as well for the always excellent WIR and the Cara site in general with all its varied discourse. What an outstanding community...
If Patrick is truly leaving, we will all be the worse for it - His reports are a staple of sanity and quite worth the read always. If it is to be, we wish you the very best and thank you for your consistent, considerate and savvy market insight.
Step #1 - find ETF's (preferably with decent average volume to indicate participation) that comprise your scope of interest: financials, biotech, or in this case, dividend payers.
Step #2 go to morningstar for a quote and then see "holdings" under "portfolio" -- you now have have the constituent parts of the ETF, in this case, the high dividend payers. Now find some strikes that might work for you.
You could perhaps, just stop with the eft itself (no positions in any of this - just FYI) and see if options are available on that instrument without digging deeper. DVY, DJ select dividend index, has options available, for instance (no opinion on whether that's a good choice or not).
I do this drilling down quite a bit, as ETF's gain even more market share. It's useful to know that, for instance, Procter and Gamble has a 14% weighting, with Phillip Morris in second place with almost 10% of XLP...
Would new, (even more damning) cigarette warning labels have an effect on XLP, for example? Could be.
But front-running is such a time-honored practice, why should now be different? I do truly wish CFTC/SEC would stop that nonsense, but would not hold my breath. But someday, maybe yet...someday...
From a manipulation point of view, I thought it was a nice piece of work. They needed a surprise to arrest a potential freefall weeks in the making, and everyone expected the surprise would originate with the fed. Instead the market was first let down by "the beard", then completely blindsided (although a select few weren't blindsided, I'm sure...) by the IEA release and the greek announcement. Out of the blue, it had even more impact (at least temporarily..I guess we see about that...).
Really looking forward to every sovereign financial position being held by ex-Goldman alums. At least then we can expect some consistency! (tongue firmly in cheek)
Thanks for everything Bill and all participants here! Have a good trading (and otherwise) day.
"It’s about ‘phantom indices’ — or the idea that widely-followed indices such as the S&P 500, the Dow Jones Industrial Average or the Nasdaq 100 don’t actually track all of the shares traded intraday. The discrepancy, Themis says, stems from the indices being calculated using only primary market data, in a world where a significant amount of trading has now moved off into non-primary spheres.
How much are the indices missing?
Themis says as much as 70 per cent of all shares traded on an intraday basis."
Still the chart is what the chart is if you're trading it (i.e., the chart I'm trading IS the one that counts regardless of where the transactions are being done) - but that's a lot of liquidity that's hiding out there...institutional volume footprints harder to follow...hmmmmm...
..."value in it for the individual (as opposed to a business)"
When it works properly (and believe me, early days with mobile me was anything but happy) it is quite useful:
I enter a calendar event on my iphone - it automatically pushes that event addition out to my assistant,and my other computers. It is the same kind of functionality on the enterprise side only allows individual users to make use of it.
It is not without problems however (ah, but what is?)
Last thought on security - at one point in a crazed mood years ago, I wondered,"why is AOL sending every man woman and child in North America innumerable CD's for a free trial of their internet service?" Then I wondered," If I wanted to read other people's mail (the age-old euphemism for spying), what would be the easiest way to do it?
hmmmmm, simple - get it all in one place - and then be the postmaster.
There used to be a website called "rob me please", or please rob me, something like that, whose sole mission was to republish the ridiculous things that people posted on facebook, like:
"...Bobby and I are going out of town the 24th - but we just finished putting in the new TV and have a very cool new audio system. You have to hear it! But don't call the weekend of the 24th, we'll be gone..."
And then the site would post other readily available info on the poster taken form facebook, and then send them a email, as in:
"Thanks for the info: we now know what you have, where you live and when you'll be out of town. This has been a public service announcement for your benefit."
The site was dismantled, but served for a short time to make people aware of how dangerous the mix is of your identity with the internet, (especially if you're not thinking protectively).
oh what? Only 62,000 passwords, that's REALLY a drop in the bucket compared to citigroup's 200k.....under the rug please!
" Sure, centralized heating is more convenient and economical than in-house one, but when it breaks down it impacts all who depends on it."
I like to think of it as the technology/server equivalent of holding trillions of CDS exposure on each other - with no reliable counterparty. When it goes down, it takes everything down with it. Failover protection will be very important here vis-a-vis cloud technology.
And I just can't believe that like unfriended her own mother - that's like, wait, I didn't mean to say it was"like", only that, it didn't seem like....ai-yi-yi !!
I did it again -I can't (like) seem to get the hang of it....
NEW YORK (CNNMoney) -- Citigroup says it has discovered a security breach in which a hacker accessed personal information from hundreds of thousands of accounts.
Citigroup said the breach occurred last month and affected about 200,000 customers.
only 200,000 - why that's not bad at all, is it? Under the rug, please...
I just have a particular view on it - I run a computer consulting group, and a major focus is apple - that's not because I love the company or the way they do things these days one way or another, but because I hate dealing with viruses, spyware, etc. that just are so much less a problem on mac.
That being said, I believe apple does theater better than anyone, and they long ago became a marketing company - their software development has always driven hardware sales (make a cool app, OS, cloud, or whatever, then make it dependent on a new piece of hardware (intel chip, etc.) and thereby sell more computers/devices. This is not necessarily evil - they write good code and that new code requires more resources - that's what drives things forward.
Apple is ALL about devices (since the ipod remade them, really) - and they now call it a "post PC world". This I think is correct - mobile devices that will have data pushed wirelessly from the cloud. In a bizarre way, the concept is a return to the 70's when computers in business were generally dumb terminals sitting on a desk, being fed data from a centralized server. Only now, that server will be in the cloud. This makes for a more centralized source of failure and a excellent target for sovereign hacking as it will all be in "one" place, but this is the way it's going to go...
It also makes severe PC/device crashes easier to deal with, as it can all (with limitations) be downloaded again.
As to the stock, being mostly a trader, as opposed to a long-term investor, I have no insight as to it's current valuation - it is after all, what people will pay for it.
Apple doesn't care about making a profit there - the cloud is a way to drive people to sign up for the (soon to be free) mobile me accounts (actually mobile me goes away, but the services stay and are renamed and expanded as iCloud)
The free apple ID gets people the cloud. Apple then pushes all access to operating system downloads (as in the new Lion OS coming shortly) through the app store (the only way to get any new OS theoretically. This will become standard operating procedure - just another way of apple doing whatever it can to remove any barrier between itself and a direct experience with its customers).
Give the access away for free, then make a provision of that free access a walk through the candy store (i.e., the apple app store, now built into every new mac OS) and expose people to wares and apps and the ability (and the encouragement) to make instant buys with 1-click purchases.
This is excellent - and I, at least, would like to see more on it. The way intuition moves from the mental to the material is one of the defining issues humans face, I think. What is my (or my company's) dream? How do I think about this? Once having thought about it, how does it come into reality? Once in reality, what processes can be utilized to refine that which my imagination has made concrete? How do I advance those refinements over time? How do I reapply my intuition to the "algorithms" I have to coded?
As in, wouldn't it be fascinating if SPY, off it's incredible bottom at 1:30, were to turn tail, more or less at 128.58? That would be 78.6% retracement of our entire day. then again, that was a LOT of buying that took the futures up so fast, so anything is possible here....
More to the point, is that now that CDS have shown themselves to have no value whatsoever in terms of credibility, how will that affect investors in sovereign (read peripheral europe) debt?
I doubt they will touch it (unless at extreme spreads against bunds) and why should they? If contracts can be unilaterally abrogated and any insurance they could buy on such investments is not to be trusted, then the whole issue of funding growth in the troubled euro area just got harder, not easier with this whole deal. That is, unless the ECB thinks it can print the money that private investors would have otherwise provided. You know they are going to try...
Just want to add my thanks as well for the always excellent WIR and the Cara site in general with all its varied discourse. What an outstanding community...
Thank you Bill and team.
NYU - I always enjoy your posts. I 2nd your motion for guillotines. Cheap, efficient, and low on moral hazard.
If Patrick is truly leaving, we will all be the worse for it - His reports are a staple of sanity and quite worth the read always. If it is to be, we wish you the very best and thank you for your consistent, considerate and savvy market insight.
We would, of course, wish you to reconsider :)
Thanks again Patrick.
Congratulations on yet another year of meaningful contribution to the world (and hopefully much fun, too)!
May you have many, many more birthdays: all happy and fulfilling.
Thanks for all you do -- Have a super day!
Step #1 - find ETF's (preferably with decent average volume to indicate participation) that comprise your scope of interest: financials, biotech, or in this case, dividend payers.
http://etfdb.com/index/wisdomtree-largecap-dividen...
Step #2 go to morningstar for a quote and then see "holdings" under "portfolio" -- you now have have the constituent parts of the ETF, in this case, the high dividend payers. Now find some strikes that might work for you.
http://portfolios.morningstar.com/fund/holdings?t=...
You could perhaps, just stop with the eft itself (no positions in any of this - just FYI) and see if options are available on that instrument without digging deeper. DVY, DJ select dividend index, has options available, for instance (no opinion on whether that's a good choice or not).
I do this drilling down quite a bit, as ETF's gain even more market share. It's useful to know that, for instance, Procter and Gamble has a 14% weighting, with Phillip Morris in second place with almost 10% of XLP...
Would new, (even more damning) cigarette warning labels have an effect on XLP, for example? Could be.
But front-running is such a time-honored practice, why should now be different? I do truly wish CFTC/SEC would stop that nonsense, but would not hold my breath. But someday, maybe yet...someday...
Excellent post! Thank you, yet again...
From a manipulation point of view, I thought it was a nice piece of work. They needed a surprise to arrest a potential freefall weeks in the making, and everyone expected the surprise would originate with the fed. Instead the market was first let down by "the beard", then completely blindsided (although a select few weren't blindsided, I'm sure...) by the IEA release and the greek announcement. Out of the blue, it had even more impact (at least temporarily..I guess we see about that...).
Really looking forward to every sovereign financial position being held by ex-Goldman alums. At least then we can expect some consistency! (tongue firmly in cheek)
Thanks for everything Bill and all participants here! Have a good trading (and otherwise) day.
"It’s about ‘phantom indices’ — or the idea that widely-followed indices such as the S&P 500, the Dow Jones Industrial Average or the Nasdaq 100 don’t actually track all of the shares traded intraday. The discrepancy, Themis says, stems from the indices being calculated using only primary market data, in a world where a significant amount of trading has now moved off into non-primary spheres.
How much are the indices missing?
Themis says as much as 70 per cent of all shares traded on an intraday basis."
http://ftalphaville.ft.com/blog/2011/06/23/603596/...
Still the chart is what the chart is if you're trading it (i.e., the chart I'm trading IS the one that counts regardless of where the transactions are being done) - but that's a lot of liquidity that's hiding out there...institutional volume footprints harder to follow...hmmmmm...
..."value in it for the individual (as opposed to a business)"
When it works properly (and believe me, early days with mobile me was anything but happy) it is quite useful:
I enter a calendar event on my iphone - it automatically pushes that event addition out to my assistant,and my other computers. It is the same kind of functionality on the enterprise side only allows individual users to make use of it.
It is not without problems however (ah, but what is?)
Last thought on security - at one point in a crazed mood years ago, I wondered,"why is AOL sending every man woman and child in North America innumerable CD's for a free trial of their internet service?" Then I wondered," If I wanted to read other people's mail (the age-old euphemism for spying), what would be the easiest way to do it?
hmmmmm, simple - get it all in one place - and then be the postmaster.
okay - just one more thing...
There used to be a website called "rob me please", or please rob me, something like that, whose sole mission was to republish the ridiculous things that people posted on facebook, like:
"...Bobby and I are going out of town the 24th - but we just finished putting in the new TV and have a very cool new audio system. You have to hear it! But don't call the weekend of the 24th, we'll be gone..."
And then the site would post other readily available info on the poster taken form facebook, and then send them a email, as in:
"Thanks for the info: we now know what you have, where you live and when you'll be out of town. This has been a public service announcement for your benefit."
The site was dismantled, but served for a short time to make people aware of how dangerous the mix is of your identity with the internet, (especially if you're not thinking protectively).
oh what? Only 62,000 passwords, that's REALLY a drop in the bucket compared to citigroup's 200k.....under the rug please!
move along, nothing to see here....
" Sure, centralized heating is more convenient and economical than in-house one, but when it breaks down it impacts all who depends on it."
I like to think of it as the technology/server equivalent of holding trillions of CDS exposure on each other - with no reliable counterparty. When it goes down, it takes everything down with it. Failover protection will be very important here vis-a-vis cloud technology.
And I just can't believe that like unfriended her own mother - that's like, wait, I didn't mean to say it was"like", only that, it didn't seem like....ai-yi-yi !!
I did it again -I can't (like) seem to get the hang of it....
You made me laugh!
like citibank june9?
NEW YORK (CNNMoney) -- Citigroup says it has discovered a security breach in which a hacker accessed personal information from hundreds of thousands of accounts.
Citigroup said the breach occurred last month and affected about 200,000 customers.
only 200,000 - why that's not bad at all, is it? Under the rug, please...
Security...yes, big issue...jmo
...and btw, that is one of my favorite words: "thingy"
As in "why is my network down?" "Because the thingy reset itself on the power spike."
;)
I just have a particular view on it - I run a computer consulting group, and a major focus is apple - that's not because I love the company or the way they do things these days one way or another, but because I hate dealing with viruses, spyware, etc. that just are so much less a problem on mac.
That being said, I believe apple does theater better than anyone, and they long ago became a marketing company - their software development has always driven hardware sales (make a cool app, OS, cloud, or whatever, then make it dependent on a new piece of hardware (intel chip, etc.) and thereby sell more computers/devices. This is not necessarily evil - they write good code and that new code requires more resources - that's what drives things forward.
Apple is ALL about devices (since the ipod remade them, really) - and they now call it a "post PC world". This I think is correct - mobile devices that will have data pushed wirelessly from the cloud. In a bizarre way, the concept is a return to the 70's when computers in business were generally dumb terminals sitting on a desk, being fed data from a centralized server. Only now, that server will be in the cloud. This makes for a more centralized source of failure and a excellent target for sovereign hacking as it will all be in "one" place, but this is the way it's going to go...
It also makes severe PC/device crashes easier to deal with, as it can all (with limitations) be downloaded again.
As to the stock, being mostly a trader, as opposed to a long-term investor, I have no insight as to it's current valuation - it is after all, what people will pay for it.
Re: apple's iCloud:
Apple doesn't care about making a profit there - the cloud is a way to drive people to sign up for the (soon to be free) mobile me accounts (actually mobile me goes away, but the services stay and are renamed and expanded as iCloud)
The free apple ID gets people the cloud. Apple then pushes all access to operating system downloads (as in the new Lion OS coming shortly) through the app store (the only way to get any new OS theoretically. This will become standard operating procedure - just another way of apple doing whatever it can to remove any barrier between itself and a direct experience with its customers).
Give the access away for free, then make a provision of that free access a walk through the candy store (i.e., the apple app store, now built into every new mac OS) and expose people to wares and apps and the ability (and the encouragement) to make instant buys with 1-click purchases.
JMO
This is excellent - and I, at least, would like to see more on it. The way intuition moves from the mental to the material is one of the defining issues humans face, I think. What is my (or my company's) dream? How do I think about this? Once having thought about it, how does it come into reality? Once in reality, what processes can be utilized to refine that which my imagination has made concrete? How do I advance those refinements over time? How do I reapply my intuition to the "algorithms" I have to coded?
Good stuff -thank you for the post -
Going out on a limb here, but 128.58 is now also more or less a 113% extension of the little pull back we just had to SPY 128.04 (or so)...
As in, wouldn't it be fascinating if SPY, off it's incredible bottom at 1:30, were to turn tail, more or less at 128.58? That would be 78.6% retracement of our entire day. then again, that was a LOT of buying that took the futures up so fast, so anything is possible here....