Agree with an earlier poster who stated that the biggest fly in the short global equities position right now is the sovereign fund put. It has already started showing up in the beleaguered financials and it is probably the tip of the iceberg. If the US crashes and goes in to depression what happens to China/ Asia? Is it likely that with several trillion on hand the Asian governments will allow the US to fall in to a depression? With global growth as strong as it is (look at Rimm!) is it even possible for the US to have anything more than a mild recession (especially with 60% earnings coming from overseas as has been mentioned)? Don't see any particularly compelling trades at the moment and haven't since the last dip though short treasuries looks like it might be setting up to be the next big trade. My rule of thumb for trading this environment is to fade the panicking herd in both directions at major S/R with defined risk, and not to be greedy with targets.
There have NOT been hundreds of billions pumped into the system. Those of you in that camp should really stop listening to everything you are told. Here's your source for pump numbers: total slosh and net add/subtract are what you should keep an eye on.
Fed prints $35 billion more in fake money - Gold Bullion anyone?August 10th, 2007 The Federal Reserve has decided to make stock market junkies, big loan institutions and other big conglomerates that live off of the health of the American economy happy by assuring they will print off as much fake money as they need to. Fed injects $41 billion into financial system By Jeannine Aversa, AP Economics Writer WASHINGTON â The Federal Reserve pumped $41 billion into the U.S. financial system Thursday, one of its largest cash infusions to help companies get through a credit crunch that took a turn for the worse in August. The action comes one day after Fed Chairman Ben Bernanke and all but one of his central bank colleagues voted to slice a target for a key interest rate for the second time in six weeks to protect the economy from the ill effects of collapse in the housing market, aggravated by the credit troubles. Fed Partners with Central Banks to Ease Credit NPR.org, December 12, 2007 · The Federal Reserve and other central banks are collaborating to better manage the global credit crunch. The Fed announced in a statement Wednesday plans to offer $40 billion in emergency funds to banks next week through an auction process. Fed auctions another $20 billion in funds to commercial banks to combat credit crunch Friday, December 21, 2007 By Martin Crutsinger, The Associated Press WASHINGTON -- The Federal Reserve, working to combat the effects of a severe credit crunch, announced today that it had auctioned another $20 billion in funds to commercial banks at an interest rate of 4.67 percent.