I sell short. I don’t like it but with volatility the way it is, my investors depend on it. We are up this month and this week as a result. We maintain a 50/50 long short position and use SPYDERS to fill in the void. We don’t speculate by driving down shorts on news. We short poorly performing stocks that are temporarily over valued. Greenspan said Sunday that short sellers are necessary in normal conditions to maintain a realistically priced market. The problem we have now, and why there are so many bubbles are that hedge fund managers are so desperate for a quick score so they can make their hurdles and get huge payouts that they are running from new idea to new idea and piling on. The guys driving down the financial stocks are the same ones who brought you $147 oil two months ago. It’s a need for performance and a lack of proprietary ideas.
“The problem we have now, and why there are so many bubbles are that hedge fund managers are so desperate for a quick score so they can make their hurdles and get huge payouts that they are running from new idea to new idea and piling on. The guys driving down the financial stocks are the same ones who brought you $147 oil two months ago. It’s a need for performance and a lack of proprietary ideas.”
But we have posters on here who say that speculators perform a useful function in the futures market, that all trading is speculation and that speculators could not have driven oil prices to $147.00, that the prices reflect real supply and demand.
I believe you’e probably correct, but actual traders defend their preferred tactics and say they are not the problem.
There needs to be some independent investigation of this, and I think there are many trading and speculative tactics that need to be ended, because the financial markets have become far too much a casino for speculators, and combined with the subprime problem, they have created the worst financial crisis in many decades. And both Democrats and Republicans have made big contributions to this.