You left out the bailout for these large institutions, ie socialized losses. None of this is new information, the problem with human beings is that our hindsight is perfect, should LEH with all its flaws have been bailed as opposed to GS or Bear, that really gets to the heart of it; politics trumps money at a certain point but they are so close its hard to tell them apart.
No, Mav is articulate, logical and clear... I am using a street smart translator to try to understand your posts... Your posts are are really whacky and unclear... maybe try again next year ...
Whatever man, he lives to torture Don Bright and nitpick at a firm he wish he managed. And when something's reciprocated back to him, he obfuscates stupidity. Just an observation.
The problem lies in the fact that these markets don't trade off supply/demand but in a correlational matrix superlevered into monstrous macro hedges and cross derivatives. If nobody's learned anything from the CDS MBS and CDO markets, this discussion is pointless. Liquidity is eventually inversely correlated to the magnitude of leveraging in the open interest. This is what can happen to a gazillion dollar levered market at mid teen VIX. calm before storm, complacency prior to destruction, etc. Some big whale pulled the plug that day after he sniffed out open positions he didn't wanna have to serve. They're not really black swans. They're just events that most people are blind to or rather too dumb to see beforehand. The false assumption is that there will always be liquidity. Programs do a good job in proving that is false, real fast.
Second that. I still don't know WTF he's talking about here, or what point he's trying to make. My guess is, he got his ass reemed on May 6, or during the 2008 crash, and he's blaming GS, his own broker, or someone that he perceives as an enemy of the state. Or, the most likely suggestion is, he's just playing devil's advocate, trolling for the fun of pissing everyone off. He does seem to have your attention, which Mav, I'd be ignoring him at this point for having nothing really to say except to read himself screaming.
obfuscate [ˈɒbfʌsˌkeɪt] vb (tr) 1. to obscure or darken 2. to perplex or bewilder I am not sure how one makes stupidity any less dark, more perplexing, or bewildered than Lights has been today. WAIT, I see it now. It's like irony. dark>obfuscate>stupid>dumb>dumber obfuscate verb definition: confuse synonyms: baffle, becloud, befuddle, bewilder, cloud, complicate, conceal, confound, darken, fog, fuddle, muddle, obscure, perplex, puzzle, rattle light adjective definition: illuminated synonyms: ablaze, aglow, bright, brilliant, burnished, clear, cloudless, flashing, fluorescent, glossy, glowing, lambent, lucent, luminous, lustrous, phosphorescent, polished, radiant, refulgent, resplendent, rich, scintillant, shining, shiny, sunny, unclouded, unobscured, vivid, well-lighted, well-lit It's like, Lights sees all and we're don't. Like God, only he speaks through an alias on elitetrader.com. Cool. Hey God, er, Lights, why do bad things happen to good people? And can you tell me where my dog hid my car keys?
Obfuscating stupidity is where appearing a little dumb can be the deceiver's best friend. Do I need to spell out everything for you? Aren't you all traders where the job is to seek out hidden gem under the belly of deceit?
par·a·noi·a    [par-uh-noi-uh] ânoun 1. Psychiatry . a mental disorder characterized by systematized delusions and the projection of personal conflicts, which are ascribed to the supposed hostility of others, sometimes progressing to disturbances of consciousness and aggressive acts believed to be performed in self-defense or as a mission. 2. baseless or excessive suspicion of the motives of others.