Posted on 09/19/2008 5:52:08 PM PDT by politicket
When government officials surveyed the flailing American financial system this week, they didn't see only a collapsed investment bank or the surrender of a giant insurance firm. They saw the circulatory system of the U.S. economy -- credit markets -- starting to fail.
Huddled in his office Wednesday with top advisers, Treasury Secretary Henry Paulson watched his financial-data terminal with alarm as one market after another began go haywire. Investors were fleeing money-market mutual funds, long considered ultra-safe. The market froze for the short-term loans that banks rely on to fund their day-to-day business. Without such mechanisms, the economy would grind to a halt. Companies would be unable to fund their daily operations. Soon, consumers would panic.
(Excerpt) Read more at online.wsj.com ...
Apologies all around....
Zero sum game....it is.
Smacks self in head......
If it were banned they wouldn’t of taken those losses now would they?
Futures are a whole different thing and you know it. Don’t compare stocks with futures. The purpose of futures is too lock in a specific return for a product you are offering.
Currency transactions are the same way and you do those through options trading.. OPTIONS TRADING IS NOT STOCK TRADING.
Now you could actually buy the currency to hedge but most companies do not do that.. they engage in a contract so they limit their working capital output towards the hedge.
Spot on. You make my point. Thank you.
Well, they aren't..and you weren't complaining then.
: )
Here's the way I look at it....I can't fight um, so I joined them. Learn how to short...so you can take both sides. Or if shorting just goes against your constitution...then go long any number of inverse ETF's out there.
http://tradermike.net/2007/03/list_of_inverse_short_bear_etfs_/
It’s not a matter of playing the game. I invest the have some kind of retirement but I don’t invest to be the next Warren Buffett. Speaking of Warren.. he made his money doing the old buy and hold anyways.
I don’t need to bet against a stock to make money.. plenty of ways to make money without doing that.
It’s not about “missing out” on money that’s out there. Just because you can do something or because it’s always been done doesn’t make it right.
Just take a look at what happened with Long Term Capital Management and what their behavior could of done to the economy if the Worlds 50 biggest banks didn’t save their butt.
I understand.
I don’t need to bet against a stock to make money.. plenty of ways to make money without doing that.
I was just saying.....As it used to be one of the "dirty" little secrets...on Wacker and Wall streets.
It’s not about “missing out” on money that’s out there. Just because you can do something or because it’s always been done doesn’t make it right.
Fair enough. But I always thought the idea was to play by the rules that are set up. I don't happen to think it's wrong. The market is way bigger than me...and even Warren Buffet. I admit...it's a little strange "betting" against a stock. But, some I actually like betting against. I bet you could name some yourself. Ha!!
Just take a look at what happened with Long Term Capital Management and what their behavior could of done to the economy if the Worlds 50 biggest banks didn’t save their butt.
This mess...is way bigger than speculators shorting the market.
Have a great night.
bttttttttttt!
Well that’s stupid.. that’ implies that 1999 early 2000 would never of happened if not for short selling... that 2008 would never of happened if not for short selling.
Clearly if stocks get built up to a fever pitch it’s up to you to sell and get out.. when there are too many sellers the price will fall.
It’s simple supply and demand.
We can of course talk about the level of risk upon each speculation. Obviously investing in say an oil company with one project in say Brazil is far more risky or speculative if you will than say a discount food company.
Yes, most definately.
LMAO!...I rest my case your Honor!...U need both sides of that equation to make it work! I sometimes demand a lower price for over priced goods or services....You would pay till your broke or think some other fool will assume your liability???..
You've never bought a stock that u thought was undervalued??.....YES/NO ?? ..if your answer is YES..why do u think its not possible or right for someone to have an oposing opinion ? its called...price discovery!!! (Free Market economics 101 ) I assume you sold your tulip bulbs at the peak and think the buyers were stupid when they lost everything...
You don’t need shorting for supply and demand.. I have a stock to sell and you are willing to buy it at a certain price.. if that’s below market price then the price falls.
Hard to believe such easy concepts are so hard to get across.
Short sellers BUY stocks that have gone down.....Halting the slide of sellers at a perceived reasonable and fair price! (usually higher actually cause its hard to pick the lowest point )
PS.....I covered my short position of Wacovia (17.35) at 1.83 even though it went lower!!!....Some seller somewhere got to sell his stock at a HIGHER price then he would have gotten later.....I SAVED HIM SOME LOSSES!.... get it???
What I get is that you don’t get it.
Just because short sellers cover doesn’t mean anything.. yes at some point they buy.. I get that. The fact that short sellers don’t get is that they are causing fake activity. I tried to explain that to someone else already but he didn’t get it either.
When you buy and sell “borrowed” shares that is additional trading that shouldn’t exist in the real world. You don’t borrow cars or houses and pretend to sell them on the market before they are actually sold do you?
Granted it’s a practice that’s been around for a while and suddenly changing it could have unintended consquences. But, just because something has been done for a long time doesn’t mean that it’s a good practice.
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