Kass: Kill the Quants, Punish the ProBears

Discussion in 'Wall St. News' started by ASusilovic, Mar 3, 2009.

  1. The mission of the U.S. Securities and Exchange Commission is to protect investors, maintain fair, orderly, and efficient markets, and facilitate capital formation.

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    Most investors (who are long-biased), and indeed the very U.S. stock market as a whole, are disadvantaged in a market dominated by momentum-based quant funds and by ultra bear ETFs, both of which prey on a weakening hedge fund industry riddled by redemptions and by a community of individual investors whose confidence is badly broken.

    These quant funds and ultra bear ETFs, which bypass Federal Reserve Regulation T margin rules governing the extension of credit by securities dealers and brokers in the U.S., wreak havoc in a market that needs all the regulatory support it can get.

    Today's investors no longer walk tall as they have seen their portfolios shrivel up. For several years, institutional and individual investors have been competing on an uneven playing field dominated by the powerful quant funds and ultra bear ETFs that not only have a disproportionate role in total NYSE trading but, more importantly, have had an undue influence on pushing stocks lower during the course of the bear market.

    The pages of RealMoney have included an extensive and effective discourse on the effect of the ultra bear ETFs on the market, so I won't spend much time repeating what others on the site have written.

    In 2009, investors are not only facing an unprecedented economic, credit and financial outlook coupled with the uncertainty of public policy but they are also competing against quant funds and ultra bear ETFs that seem to resemble legendary basketball player Wilt Chamberlain, who dominated the NBA because his 7-foot-plus frame gave him an obvious advantage against the other players.

  2. I suppose when the market moves up....

    The Pro Bull ETFs should be disallowed....


    Actually the market should have 1x2x3x4x....shares....
    Both long and short....

    With no other margin....no account minimums....

    With size restrictions....
  3. Poetic justice. Let individual investors feel the pain. Nobody complained to regulators in 1999/2000 when Soros and Robertson got their tech short positions squeezed by individual investor money inflows into tech mutual funds :cool:
  4. There is a simple solution :
    if in trouble => double ! :D
  5. LOL. :D
  6. what a fucking hypocrite

    doug kass is one of the most famous bear traders of our time
  7. Corelio


    True but the man has been increasingly bullish counting on a rebound that is taking a long time to materialize.

    So the article is apropos to his agenda.
  8. i think he has a lot of faith in TRIN - he was the one who called the april 2001 bounce, as that very nasty leg of the nasdaq crash was ending

    at least that's what he was basing it on back then
  9. AAA30


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  10. Cutten


    He really thinks prices are down because of a few quant funds and bear funds? Nothing to do with the total bankruptcy and implosion of the global banking system, and the unwinding of one of history's biggest real estate bubbles?

    There are no bear funds in most countries, yet their markets are down massively as well. There were quant funds from 2003 to 2007, and the market rose relentlessly. I'm also interested in how he thinks the US Treasury bear fund has contributed to that market's 50%+ collapse too....oh wait, the bond market is actually UP HUGE...huh, I thought quant and bear funds meant a market had to go down?

    Trust me, if any quant or bear fund could manipulate the entire world's stockmarkets in this fashion, they would have done it a long time ago and be worth trillions of dollars. Instead even the biggest funds are maybe a couple of tens of billions.

    Let's be clear what this article is really about - Doug Kass got long too early, is wrong, and is now looking for a scapegoat to blame instead of taking it on the chin and admitting he fucked up.

    Before this bear market is done, I wonder how many more clueless pillocks are going to indulge in shoot the messenger.
    #10     Mar 3, 2009