Reuters: Germany to ban shortselling, tonight

Discussion in 'Economics' started by Debaser82, May 18, 2010.

  1. Your argument for eliminating interest rate swaps is very unconvincing.

    I'm not sure what all of the "third world getting screwed" business is all about, but companies use interest rate swaps primarily to hedge against interest rate risk via floating vs. fixed exchange rates. Indeed, if one company is able to borrow at a lower rate than the other, this type of swap can provide savings to both companies involved.
     
    #31     May 18, 2010
  2. says the guy who has no idea what he's talking about. Do some research - by people with actual degrees in subjects like economics and finance instead of reading ramblings written by old cranks on message boards churning their retirement portfolios.

    here's one article, for instance. Try to chew through it before you post rubbish about naked short selling again:

    http://www.cato.org/pubs/regulation/regv31n1/v31n1-6.pdf
     
    #32     May 18, 2010
  3. morganist

    morganist Guest

    i can remember a little more now. i think it was to do with the return received from the first world country being reduced by the instability of the third world currency. but i can't remember exactly how.

    it was something on the lines of the stable cash stream from the first world did not hold its relative purchasing power with the third world country because the repayment value of the third world country increased and there was a real loss due to the inability to repay it.
     
    #33     May 18, 2010
  4. My justification is that I know finance and economics and understand what swaps are. I'm in no mood to teach basics to guys full of opinions but completely lacking in knowledge. Find a textbook. Use google.
     
    #34     May 18, 2010
  5. morganist

    morganist Guest

    i don't think you are necessarily that well informed. you assume you know more than others here. are you sure about that. perhaps there is a gap in your knowledge about this subject have you considered that?
     
    #35     May 18, 2010
  6. I used to short sell electronics on ebay. I would sell the item and THEN order it from my distributor who then proceeded to dropship it. :)

    Backfired on me once though. I sold about 15 camera watches once and my distributor took 2 months to deliver(while constantly telling me that it would be there "next week"). So many people were pissed at me and told me I ruined their Christmas. That was the end of my relationship with that company and the end of my selling on ebay.
     
    #36     May 18, 2010
  7. http://market-ticker.denninger.net/

    If you thought the German government was going to be a lapdog for Sarcozy, or worse, was going to fellate Brussels and the ECB, you got a rude shock today.

    It appears that the German Government has just plain had enough of the crap that the banksters have tried to pull, and has decided to do what Barack Obama should have done in early 2009.

    That is:

    •No more naked credit crap, especially against sovereigns but not only against sovereigns. No insurable interest, no CDS - period.

    •Naked shorting will now be actually stopped in 10 leading financial institutions.

    •Germany has had it with naked shorting of Gold, and specifically noted bank manipulation of gold prices via naked shorts beyond intent or ability to deliver.

    •Germany has also said that they're not going to permit Euro derivatives that are not a "bonafide" FX hedge. That is, no more naked bets on Euro movements either.
    •Hedge funds are going to be regulated, position size limits mandated and enforced, reporting enhanced and a transaction tax is coming.

    It's about damn time.

    Oh, and it appears that instead of telling all the banksters what they were going to do and "getting permission" first, or even discussing it with other governments, the German Government did what all governments should do - make up your mind and then do it without giving a good damn whether the banksters or other governments think about it.

    The bid rigging, the game-playing and the rest are all a bunch of crap. I've been hollering about this now for more than three years and yet our government spends it's time fellating the bankers and their dogs instead of enforcing the law.

    It is illegal to defraud people.

    It is illegal to rig markets, including the massive bid-rigging that I wrote about this morning, the Jefferson County Alabama scam and dozens if not hundreds more - all committed, it is alleged (and in some cases proved) by the major banks.

    It is illegal to short stocks with no intention or ability to deliver.

    And it is illegal to bribe government officials, no matter how you accomplish it.

    These are not "isolated incidents" or even a pattern of conduct - as the bid-rigging report this morning makes clear ripping people off has become an institutionalized practice and policy throughout the entire banking system.Many said that the Germans were not "really" arm-twisted by Sarcozy and the French Banking interests a week or so back. I think we can put that to rest here and now, as it's pretty clear that the truth is something else entirely.

    Now Barack, about your willingness to get up off your knees and kick these banksters in the nuts?

    Better late than never.
     
    #37     May 18, 2010
  8. morganist

    morganist Guest

    peil i feel so sorry for you.

    the other point about the third world and swaps.

    the first world country had to pay back a stream of cash. this was stable. the thrid world had to pay back a stream of cash. this was not stable.

    this is what happened. the third world country lost production ability. i don't know what happened, drought, war something. the currency lost value due to the supply shock creating an inflationary gap, the inflationary gap was tackled with higher interest. the higher interest created a net loss to the third world country because the real payments were higher than the amount received back from the first world cash flow, whose stable currency keep a consistent interest rate and payment.

    happy now.
     
    #38     May 18, 2010
  9. Yeah I agree. It's amazing after the terrible results of the Pakistan, USA, UK, and Greece short sale bans in the last few years (the market collapsed in the next few weeks and months on each occasion), that Germany wants to do the same. They must want their stocks to get cheaper and the Euro to go lower.

    They're even wheeling out the "fundamentally safe and sound" currency spiel that always accompanies a big devaluation:

    http://online.wsj.com/article/BT-CO-20100518-710613.html?mod=WSJ_World_MIDDLEHeadlinesEurope
     
    #39     May 18, 2010
  10. Let's extend this logic a bit. There have been some occasions where third world countries have used guns and it ended poorly for them. I think the idea was for the police and government to uphold the law so the population would be safe.

    It didn't end as well as anticipated. Neither police or government acted as was predicted and the third world population got massacred under a dictatorship. I can't remember the details but I will look it up.

    In the meantime, let's ban guns and police forces because of it. And tanks. And standing armies. Hell, let's ban governments to avoid this horrible repression in the third world.
     
    #40     May 18, 2010