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Post by walnut on Feb 19, 2016 3:15:12 GMT
I have invested thousands of hours into this hedging problem. I go to bed thinking about it, and I wake up thinking about it. Find the answer and you could be rich as Croesus haha
Imagine all of those endless tables of numbers and months and strike prices that make up all of the stock options, futures, futures options, reverse volatility ETF's, etc etc etc, and find a pattern in the chaos that could allow you to beat the market. This is what I have been wasting years on...
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Post by douglavers on Feb 19, 2016 10:18:32 GMT
In a world where:
a) The majority of Governments have now borrowed far more than they can ever repay
b) Most governments are running large current expenditure deficits
c) The world-wide security situation is deteriorating
I have no idea where safety lies from an investment point of view.
In Australia, there is now a $A 3 trillion privately owned pension pot, lightly taxed.
Political parties of all complexions are wondering how they can dig their noses into it.
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Post by Andrew on Feb 19, 2016 11:29:24 GMT
In a world where: a) The majority of Governments have now borrowed far more than they can ever repay b) Most governments are running large current expenditure deficits c) The world-wide security situation is deteriorating I have no idea where safety lies from an investment point of view. In Australia, there is now a $A 3 trillion privately owned pension pot, lightly taxed. Political parties of all complexions are wondering how they can dig their noses into it. a) Governments have no requirement to ever repay their debts b) Australia does not have a large government debt c) My parents were being bombed in ww2 and my father, uncle and their friends were in the forces in ww2, and my grandfather was captured by the germans in WW1. At the end of the war mum was working at the Cunliff Owens spitfire factory putting bullets in boxes. When the sky over portsmouth was all red they knew they would be safe that night in southampton. Strangely, even though mums house was at the end of Southampton airport the street was never once hit by bombs even though southampton docks were flattened. In all of my life there have been wars all over the place and today I am far more likely to be killed in a car crash than in some war like event. No worries mate!
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Post by douglavers on Feb 19, 2016 21:48:55 GMT
Andrew
A) "Governments have no requirement to ever repay their debts"
True. Problem occurs when they want to keep on borrowing, and nobody wants to lend them any money! [The Japanese - and to a lesser extent the US and EU - now simply print the money. Its called QE. Works while there is a deflationary environment and spare capacity, and markets still have confidence.]
B] "Australia does not have a large government debt".
Seven years ago, we had no net Federal Debt. What is frightening, is the rate it is now growing, to the tune of about $50 billion pa.
Also, private sector and State debt is quite large. If those are included, we are well up the rankings in terms of overall national borrowing.
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Post by nonentropic on Feb 20, 2016 0:07:00 GMT
Are the deficits structural or cyclical that's all that matters.
Looking at Australia from NZ I'm not sure but suspect some of the $50B is moving from cyclical to structural but time will tell how it goes.
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Post by Andrew on Feb 20, 2016 7:46:55 GMT
Andrew A) "Governments have no requirement to ever repay their debts" True. Problem occurs when they want to keep on borrowing, and nobody wants to lend them any money! [The Japanese - and to a lesser extent the US and EU - now simply print the money. Its called QE. Works while there is a deflationary environment and spare capacity, and markets still have confidence.] B] "Australia does not have a large government debt". Seven years ago, we had no net Federal Debt. What is frightening, is the rate it is now growing, to the tune of about $50 billion pa. Also, private sector and State debt is quite large. If those are included, we are well up the rankings in terms of overall national borrowing. I had not realised Aussie government debt was rising like that, but governments can 'always' borrow if they pay the interest required and right now interest costs are very low. Japan has no problems borrowing money - but yes at some point something must change there.
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Post by walnut on Feb 20, 2016 15:55:37 GMT
Funny the the Fed seems to feel so compelled to raise rates, I guess to validate that their entire QE scam was a success I think. They should be desiring to keep rates low until the US can get the debt down 20% or so. If they could accomplish that, I would admit that QE was a big success. As it is now, we only bought our way of of the disaster with a gigantic long term mortgage. Use the QE money to buy back and cancel bonds, the dollar remains strong, stock crash averted. Print several billion, hand it over to the Chinese, and declare "we owe you nothing" that was Bernanke's original plan and it seemed to be working. The Chinese were complaining even as the dollar was rising, it was funny, and it worked.
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Post by nautonnier on Feb 22, 2016 21:29:33 GMT
Funny the the Fed seems to feel so compelled to raise rates, I guess to validate that their entire QE scam was a success I think. They should be desiring to keep rates low until the US can get the debt down 20% or so. If they could accomplish that, I would admit that QE was a big success. As it is now, we only bought our way of of the disaster with a gigantic long term mortgage. Use the QE money to buy back and cancel bonds, the dollar remains strong, stock crash averted. Print several billion, hand it over to the Chinese, and declare "we owe you nothing" that was Bernanke's original plan and it seemed to be working. The Chinese were complaining even as the dollar was rising, it was funny, and it worked. It's not only QE the President aided by the dilatory Congress has started trying to max out every source of borrowing on the debit side while using regulations and taxation to make value creation farming and manufacturing extremely difficult and expensive if not trying to actively close them down, thus reducing the 'income' from US productivity. These twin approaches seem to have accelerated in this 'lame duck' session with what appears to be full cooperation of the Republicans.
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Post by sigurdur on Feb 22, 2016 22:23:41 GMT
Funny the the Fed seems to feel so compelled to raise rates, I guess to validate that their entire QE scam was a success I think. They should be desiring to keep rates low until the US can get the debt down 20% or so. If they could accomplish that, I would admit that QE was a big success. As it is now, we only bought our way of of the disaster with a gigantic long term mortgage. Use the QE money to buy back and cancel bonds, the dollar remains strong, stock crash averted. Print several billion, hand it over to the Chinese, and declare "we owe you nothing" that was Bernanke's original plan and it seemed to be working. The Chinese were complaining even as the dollar was rising, it was funny, and it worked. It's not only QE the President aided by the dilatory Congress has started trying to max out every source of borrowing on the debit side while using regulations and taxation to make value creation farming and manufacturing extremely difficult and expensive if not trying to actively close them down, thus reducing the 'income' from US productivity. These twin approaches seem to have accelerated in this 'lame duck' session with what appears to be full cooperation of the Republicans. Pretty sad state of affairs!!!! What you wrote is 100% true. How I wish it wasn't.
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Post by walnut on Feb 23, 2016 2:37:06 GMT
Funny the the Fed seems to feel so compelled to raise rates, I guess to validate that their entire QE scam was a success I think. They should be desiring to keep rates low until the US can get the debt down 20% or so. If they could accomplish that, I would admit that QE was a big success. As it is now, we only bought our way of of the disaster with a gigantic long term mortgage. Use the QE money to buy back and cancel bonds, the dollar remains strong, stock crash averted. Print several billion, hand it over to the Chinese, and declare "we owe you nothing" that was Bernanke's original plan and it seemed to be working. The Chinese were complaining even as the dollar was rising, it was funny, and it worked. It's not only QE the President aided by the dilatory Congress has started trying to max out every source of borrowing on the debit side while using regulations and taxation to make value creation farming and manufacturing extremely difficult and expensive if not trying to actively close them down, thus reducing the 'income' from US productivity. These twin approaches seem to have accelerated in this 'lame duck' session with what appears to be full cooperation of the Republicans. Don't forget mining, one of the pillars of wealth creation.
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birder
Level 3 Rank
Posts: 223
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Post by birder on Feb 23, 2016 20:31:35 GMT
I was wondering why the USA is not doing what Europe is doing i.e. allow other countries to join the Union such as Mexico and Central America?
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Post by sigurdur on Feb 23, 2016 20:38:38 GMT
I was wondering why the USA is not doing what Europe is doing i.e. allow other countries to join the Union such as Mexico and Central America? No thanks Birder. US Citizen here. I fully expect Britain to tell the EU to take a flying leap.
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birder
Level 3 Rank
Posts: 223
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Post by birder on Feb 23, 2016 21:44:04 GMT
I was wondering why the USA is not doing what Europe is doing i.e. allow other countries to join the Union such as Mexico and Central America? No thanks Birder. US Citizen here. I fully expect Britain to tell the EU to take a flying leap. I sure hope so but I'm not so sure, too many sheeple and scaredy cats.
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Post by douglavers on Feb 23, 2016 23:26:04 GMT
The real problem faced by Cameron, is that the "deal" he negotiated can be derailed by at least three EU identities.
His campaign is toast if this happens before June.
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Post by nautonnier on Feb 24, 2016 14:13:07 GMT
The real problem faced by Cameron, is that the "deal" he negotiated can be derailed by at least three EU identities. His campaign is toast if this happens before June. From having worked in and around the EU Eurocracy for several years, the 'deal' was agreed around 3 months ago and the run up to it was just theater and window dressing. The deals will be rolled back, if the referendum looks like it will be for 'stay in' then the deals could disappear before June, if the BREXIT proponents look like winning then the deals will remain in place until there has been a referendum to stay. Ireland had an initial referendum to leave, then another where the vote was said to be to stay. So referenda iterate until the EU gets the result required and then the deals are rescinded. After the Lisbon treaty goes final next year it is close on impossible for countries to vote to leave, the idea is to break the EU into 'Regions' that do not follow country boundaries. So for example Scotland will become part of The North Sea Region. L'engrenage.
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