Next week the market begins to drop

Discussion in 'Professional Trading' started by beachhouse, Feb 24, 2012.

  1. Greek deal brings this:

    "Banks, insurers and other investors holding about 206 billion euros of Greek government bonds will take a 53.5 percent loss in the face value of their securities, with actual losses estimated at 73 to 74 percent."

    Bank downgrades will flood in......

    Back to reality.
  2. Old news.......I reckon the market has already factored it in.
  3. Greece is completely old news. Nothing else could come out of greece that would push the market lower.
  4. The news came out on Friday, it's new news.

    The consequence is real this time (taking a 70% loss for the private bond holders). I am sure they are still trying to derail this Greek government deal.

    If banks are forced into the swap and take 70% loss, they will be downgraded. I am sure the rating agencies are waiting for the final nail to the coffin before dishing our downgrades.
  5. Bob111


    i've seen enough proof that the banks and rating agencies are in same club...AAA lehman is more than enough for me..they all full off shit..
  6. The consequence was always real in the markets eyes. You have to realize that smart people saw this play out already in their heads months ago, and positioned themselves accordingly
  7. true, but there is mountain of funds that enforcably invest based on ratings. Also true that last downgrade of au banks did not have any effect. So maybe selling is now matched by bargain hunters (as per your comment) and price does not drop.
  8. Let's not forget this: The greek deal is a one-sided one, private bond holders may not go with it. That's why the greeks set a deadline of March 8 (with the possibility of an extension. :D Are they serious about the definition of "deadline"? :D ).

    Anyway, something funny is going on. If a hedge fund holds $100 million worth of bonds, it will hold out for a forced greek default and get insurance money (100% money back), not the swap deal (25% money back). In other words, it tells the greeks: you can set any "deadline" you like, I will get my insurance money no matter what will happen.
  9. Figures, right after I lost 1/3 million (40%) in the short squeeze. :eek:
    Sometimes having brass balls isn't an advantage.

    What gets me though is not my losses but my under-estimation of how far the powers that be, will go to manipulate the rules ex-post facto.
  10. Bob111


    #10     Mar 5, 2012