NASDAQ 100 Trust Shares (QQQQ)

All Comments on QQQQ

  • commenter
    Alexander77
    Oct 13 12:38 AM
    The Crash of 2008 [view article]
    Your points make sense now lt us see what the markets think tomorrow, I hope you are right Reply
  • commenter
    constructe
    Oct 13 12:32 AM
    Lehman CDS Auction Ends, Now What? [view article]
    The CDS settlement doesn't mean much anymore because over the weekend the FED suspended market to market claiming that all institutions can give any value they want to their illiquid assets. I am sure they are not giving their $60 trillion in CDS values $0.10 which keeps it a nice black box until they declare bankruptcy or require a few $100 billion in bailout money. The action Friday and over the weekend are as synthetic as Japan before their market tanked for 20+ years. Reply
  • commenter
    constructe
    Oct 13 12:28 AM
    Can the Market Go to Zero? [view article]
    Well the SEC allowing banks to value all illiquid assets at anything they want like they did this weekend is a good start to making the market completely irrelevant. A 0 value is a completely unknown value the same way the $61 trillion in CDS contracts could make the $71 trillion in US assets - the $15 trillion in known debt add up to less than 0. I suppose it would be about correct give or take a few trillion. Reply
  • commenter
    constructe
    Oct 13 12:24 AM
    The Case for a Bounce [view article]
    What good is PE when the SEC issues the directive that all institutions can value their illiquid assets at whatever they feel (which they did). And then declaure this is not suspending market to market since these assets are not marketable to start with. Righto... socializing banks is also capitalism because you put capital in them. Gees, when the world needs trust and transparency they throw the balance sheet in the fire and hope we say it's all better now. Reply
  • commenter
    carey_jim
    Oct 13 12:24 AM
    How to Handle a Snap-Back Rally (If We Get One) [view article]
    BxCapricorn:

    ProShares isn't bullet proof.

    SRS experienced a short squeeze last Friday and went from 154 to 114 in about an hour even though the DOW only went from about -400 to -100 during that same time frame.

    There is a lot of funny money out there and it isn't always possible to laugh.
     Reply
  • commenter
    curious cat
    Oct 13 12:22 AM
    My Website
    What a Look Back at the Japanese Market Tells Us [view article]
    flyfarmer: there was a time when almost all the goods in england were made in america. they stopped producing goods because it was more economical to import them. they raised the standard of living in this country by consuming our goods. we are now returning the favor, by raising the standard of living for people around the globe. sure, we have lost some jobs. so did the english. we have devalued our money. so did the english. they no longer rule the waves and we have learned or should have learned in the last fifty years that we can no longer project power around the globe, at least, not on the ground. the english learned to adjust their life styles and still found a way to continue paying royal family members a yearly stipend. we can probably manage to do the same for our democrats. hang in there.
    Reply
  • commenter
    No Free Cake
    Oct 13 12:20 AM
    This Isn't a Bottom, It's a Disturbance in The Force [view article]
    FreeFalling: As to your comment about "just wait for Alt-A resets next year". It might not be as bad as you think. Example, my mortgage (not Alt-A tho) resets 2% over 6 month Libor which now is about 4% and a month ago was 3% and a year ago 5%. If I reset now my payment would be exactly the same as it has been! Reply
  • commenter
    Howard Sun
    Oct 13 12:16 AM
    My Website
    The Case for a Bounce [view article]
    PE is not a good measurement in this current state. Fundamentals DO NOT matter in the short-run. However, I also suspect there will be a bounce next week as shorts cover and as bailout plans begin to take some effect. However, the market will likely continue to fall after that. Reply
  • commenter
    Bo Peng
    Oct 13 12:10 AM
    Is the End of the Crisis Near? [view article]
    I sent this to SeekingAlpha on Saturday. They seem to have decided not to publish it. I'll just post it here for my own record: The DTCC press release today on Lehman CDS net settlement being only $6B doesn't change my view.
    ----------------------...

    10/21: The Bottom

    If anybody has anything to do with financial stocks but hasn't paid attention to an "obscure" thing called CDS, while such investor should not exist in theory, now is the time for such non-existent, hypothetical investors to take notice.

    Let's cut to the chase. On Oct 21, somebody A will have to pay somebody B $C in cash to settle CDS on Lehman. Estimates on C range from 100 billion to 400 billion. Group A will almost certainly include AIG, the biggest net seller of CDS, and many hedge funds, who have been using CDS selling as their cheap (HA!) financing source for the past few years. Besides single-name CDS specifically on Lehman, other credit derivatives such as CMCDS, CDS options, or Nth to Defaults, CDX indices and bespoke CDOs with Lehman in it will also settle, partially or in full.

    This will be arguably the biggest cash-exchange day in human history to date. I don't care how much tax-payer's money the government will use to bail them out, somebody will fail.

    Group B includes two types. One has Lehman bonds. They will be made whole by the settlement although Lehman bonds changed hands at 8.625 cents on the dollar at today's auction. The other doesn't have Lehman bonds. They bought naked CDS on Lehman. They will have a HUGE windfall -- for every dollar notional, they'll get over 91 cents. If they could collect, that is.
    Back to the more immediate concern. Who is A?

    You could pore over the CreditFixings' auction info and guess. I think a lot of people did just that today. They pounced on MS, GS, CS, and DB, who happen to be the biggest Physical Settlement Sellers (meaning they sold CDS on Lehman). JPM shot up the whole day, which happens to be the biggest buyer.

    But I don't know how productive this guessing game is. The dealers could be placing orders and requests for their hedge fund clients. Short of serious insider info, there's no way of knowing how much of those requests are for themselves vs clients. More importantly, physical settlement will almost certainly be just a small portion of the overall settlement size. Today's auction had $5.7B sell orders. Cash settlement will most likely be at least 10, maybe 100 times bigger than that. People learned the lesson from Delphi. Furthermore, it'd be very unusual for banks to have a huge net position on CDS, with the possible exception being their proprietary desks and funds. Again, most likely suspects are AIG and hedge funds.

    Now you know what the government bailout of AIG is for, the initial $85B and then the additional $37.8B (suspiciously precise isn't it?). Don't be surprised if the number goes up again before 10/21. Will tax-payers get the money back after 10/21? Fat chance. Is the money really for saving AIG or making sure others who bought CDS on Lehman will get their windfall? Take your pick.

    On to hedge funds. They knew how much they would need to pay since Lehman bankruptcy. Reportedly JPM, GS, and MS have issued massive margin calls to their hedge fund clients, which is consistent with their sell requests (except JPM who, being the clearing bank for Lehman, may have bought protection) at the ISDA auction and my suspicion that a big part of their requests are on behalf of their clients. Some hedge funds are forced to cash out. And since Thursday some apparently went shorting in desperation, trying to make a quick buck before the doomsday. The 900 point surge Friday 3PM in half an hour showed how nervous and desperate they are.

    In the meantime, of course, hedge fund investors must be withdrawing as fast as they possibly could, adding to their misery. Bankruptcy law will be the golden profession for many years to come.

    WaMu CDS settles on Nov 7. Its impact is expected to be much smaller, although nobody can be sure, as for all CDS. We may get some rough idea on its auction date, 10/23. If there're high-profile bankruptcies on 10/21 (banks, AIG), then market would be spooked and all eyes would turn to WaMu; otherwise it'd likely be a non-event in comparison.

    If there were bankruptcies of anything other than hedge funds on 10/21 (or 11/7, though less likely), then we could be in a serious chain reaction. But governments all over the world would band together to stop it. Governments may be stupid and inept, but they're not suicidal. Fed window will stay open late on 10/21. For banks (or AIG) who cannot post enough collateral, Paulson will be ready to buy stocks in a heartbeat. If the initial $250B runs out that day, they can let foreign sovereign funds to buy perferred stocks. It's a wonderful world.

    Moreover, I suspect the pending doomsday is a big reason why banks have shied away from lending to each other over the past few weeks. Nobody knows how much anybody else owes on that day. Coming 10/22, assuming no banks fail, it'd be a huge cloud gone. Back to business as usual, or as usual as it gets nowadays.

    Hedge funds' fire-sale exit may be creating a very rare buying opportunity in many financial markets (stocks, bonds, commodities, maybe even dreaded CDOs and mortgages). Two days ago I wondered if the bottom is near. Now I'm convinced the bottom will be around 10/21, if not earlier. The way back up may be painfully fast or painfully slow. But the crisis is essentially over unless we let the chain reaction take place.

    Then we'll only have to deal with the massive debt, recession, and inflation. Piece of cake.     Reply
  • commenter
    constructe
    Oct 13 12:02 AM
    Is There a Long Term Return to Long Term Normalcy? [view article]
    True. We need trust, not the SEC issuing orders like yesterday saying banks and institutions can declare whatever they want for assets no one will buy. They are the primary reason for a complete lack of trust in this market. If I'm a worthy company how do I prove it when the current rules let liars make their books look just as good as mine by marking junk as $0.80 on the dollar and hiding all their derivatives bets? Reply
  • commenter
    constructe
    Oct 12 11:55 PM
    The Bottomless Money Pit [view article]
    The SEC letting people hide even more losses and decide what value to give them will only make matters worse. Rather than more transparency, the US is engaging in Japanese style loss hiding. That's what happens when you pass a $700 billion bailout without regulation and accounting reform. You get the worst possible result. No real valuation means chaos. Trust me, I have $100 billion dollars lol. No wonder no one will loan $ to each other. Reply
  • commenter
    tenandeight
    Oct 12 11:41 PM
    The Crash of 2008 [view article]
    After being asleep at the switch, the regulators are going to throw everything they have at the credit crunch. Yes, it's now a technical problem, but it is being fed by lack of confidence on a scale not seen for decades. Structurally, something needs to be done about the casino nature of OTC derivatives. Someway, somehow, we must disallow using CDS, CMO, IRS, etc to be gambled with, and by those who don't possess sufficient capital to assume their risk. The sea change is this, and overall cessation of leverage without capital. How any semi-intelligent regulator could think that something that trades over the counter and doesn't have to appear on a balance sheet, carrying the risk of these instruments, levered at staggering ratios is not a casino, is dumbfounding. Reply
  • commenter
    David in D
    Oct 12 10:43 PM
    The Difference Between 1993 and 2009 [view article]
    Anton- While I think your proposal makes limited sense economically, it would have disastorous effects socially and that is a major factor that you have not weighed. I have no idea where you fall on the wealth spectrum, but clearly you do not have an interest in creating a win-win for everyone. Until poverty is alleviated in America and until the working class has wages that are increasing ahead of inflation we cannot will not see a lasting economic recovery.

    Frankly, your 10% income tax proposal and the elimination of the capital gains tax heavily favors those with wealth at the expense of the poor and working class. What exactly do you propose the single mother with two kids and working for $8 per hour do? Cutting her health care access certaily doesn't help her. Seriously, I would like to hear you address the "poor/working class" in America -- what is your proposal for them?

    Finally, your "low tax" agenda will not have another political chance in America for at least a decade. Bush 43 completely discredited it by giving tax breaks to the elite while running up huge defiicts. Republicans, at the moment, have NO credibility as fiscal conservatives. Therefore, if we are going to run big deficits let's at least take care of our poplulance instead of bombing innocent countries and giving contracts to Haliburton to rebuild them.     Reply
  • commenter
    Matt
    Blackman
    Oct 12 10:05 PM
    My Website
    The Case for a Bounce [view article]
    Kathy;
    Curious about your comments about that the insurers who bought the CDSs will now have the $270 billion to pay their Lehman claims. Where do you think this money will come from? The US government has already committed to more than $2 trillion, where is another $270 billion coming from?     Reply
  • commenter
    cpeterka
    Oct 12 10:05 PM
    My Website
    The Crash of 2008 [view article]
    This is NOT Mathematics. This is Emotions.
    Until the banks start to Trust each other, Until merchants get short term capital, this will continue to fall.
    Grain is piling up in the ports ( Canada, US ) because the buyers can not GUARANTEE that the money they promise for the grain they want to buy will arrive from their bank.
    The traffic in the ports is down by 20%. Joe Smallshop, and Frank Big Company NEED Short Term Capital, and until the banks TRUST them, things will continue to spiral downwards.
    Sorry, I'm holding my cast for better bargains.
     Reply
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