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re: Commodities Sell-Off Today - Thoughts?

Posted on 5/5/11 at 2:55 pm to
Posted by bbvdd
Memphis, TN
Member since Jun 2009
28148 posts
Posted on 5/5/11 at 2:55 pm to
If you buy a $ denominated bond with, let's us the euro, the return will be higher as the $ gets weaker.

Kfizzle, you're right, sorry about that.
Posted by LSURussian
Member since Feb 2005
133627 posts
Posted on 5/5/11 at 3:04 pm to
quote:

If you buy a $ denominated bond with, let's us the euro, the return will be higher as the $ gets weaker.


Please teach me, master. Use an example with exchange rates.
Posted by Blakely Bimbo
Member since Dec 2010
1183 posts
Posted on 5/5/11 at 3:11 pm to
quote:

The Fed has a schedule of future purchases, it fell within the range of purchases specified, the market would have already known that was going to occur. I don't get your logic.




Tirebiter, I am not talking about the purchase schedule, I am talking about following the money. On the POMO days the markets tend to rise at the 11:00 close of the POMO. If you look at today and then look at a DJIA HOURLY you will see where some the money went. It happened today.

It has been pretty consistent and the markets trend to rise a lot on the BIG POMO days



As with all things, it is not fool proof, but I have had a good time watching this.

PS. Check the IRX against the last 15 minutes of the Dow.
This post was edited on 5/5/11 at 3:14 pm
Posted by kfizzle85
Member since Dec 2005
22022 posts
Posted on 5/5/11 at 3:22 pm to
Correlation =/= causation. Again, without running it through the battery of statistical verification tests that exist, this is pretty much meaningless to me. This is rampant in investment analysis at all levels though, not hating, just saying.
Posted by Blakely Bimbo
Member since Dec 2010
1183 posts
Posted on 5/5/11 at 3:40 pm to
Kfizz, I'm a Bimbo... don't have an MBA... and not trying to get a job at an investment bank. My timeline is too short and I am too old to short term trade. You've got to be very young and have nerves of steel to trade. I've just been trying to follow the money. Some people do, some don't. Everybody talks their book and has their own methods of investment. It's up to everyone to do their own due diligence. And I agree... not hating, just saying.

Posted by tirebiter
7K R&G chile land aka SF
Member since Oct 2006
10717 posts
Posted on 5/5/11 at 3:57 pm to
quote:

It has been pretty consistent and the markets trend to rise a lot on the BIG POMO days


I am with kfizz on this. Parties know in advance the purchase level, the market knows it, seriously doubt it has the effect you are concluding. Tea leaves, Y shaped water divining sticks, etc.
Posted by LSURussian
Member since Feb 2005
133627 posts
Posted on 5/5/11 at 3:58 pm to
quote:

I am too old to short term trade.
Shouldn't it be the other way around???
Posted by bbvdd
Memphis, TN
Member since Jun 2009
28148 posts
Posted on 5/5/11 at 4:07 pm to
Nm
This post was edited on 5/5/11 at 4:12 pm
Posted by kfizzle85
Member since Dec 2005
22022 posts
Posted on 5/5/11 at 4:10 pm to
quote:

Kfizz, I'm a Bimbo... don't have an MBA...


Neither do I, and I also have [dirty] blond (almost brown now) hair.

quote:

My timeline is too short and I am too old to short term trade. You've got to be very young and have nerves of steel to trade.


I'm young and I don't have the time or the inclination to, and my posts don't have anything to do with trading at all.

quote:

I've just been trying to follow the money. Some people do, some don't. Everybody talks their book and has their own methods of investment. It's up to everyone to do their own due diligence.


And I'm not saying you shouldn't, I'm just saying that your method of analyzing the information you are using to follow the money is flawed and almost without question misleading and inaccurate because you're using statistical analysis with zero basis for judging its accuracy. There is no relation to trading here, its purely statistical and could apply to anything that involves numbers and graphs and such.

quote:

And I agree... not hating, just saying.


Posted by bbvdd
Memphis, TN
Member since Jun 2009
28148 posts
Posted on 5/5/11 at 8:27 pm to
With the, let's us the pound, stronger vs the $ you are able to buy more $ denominated bonds.

When the $ was worth 1.25 an investor could buy 1mm $ denominated bonds for 800,000 pounds. Now with thhe pound worth 1.64 an investor can buy 1mm $ denominated bonds for $610612 (i think that's the right number)

I edited to make sure my numbers were correct.
Posted by LSURussian
Member since Feb 2005
133627 posts
Posted on 5/5/11 at 8:43 pm to
What does that have to do with "the return being higher" as you wrote earlier?
Posted by bbvdd
Memphis, TN
Member since Jun 2009
28148 posts
Posted on 5/5/11 at 9:15 pm to
Spending the same amount gives higher par amount increasing your return.
Posted by LSURussian
Member since Feb 2005
133627 posts
Posted on 5/5/11 at 9:20 pm to
Please don't take this personally but I don't think you know what you are talking about. That or I completely misunderstand your point.
Posted by StrangeBrew
Salvation Army-Thanks Obama
Member since May 2009
18331 posts
Posted on 5/5/11 at 9:29 pm to
quote:

Nm


You should edit all of your post in this way.
Posted by md9897
Birmingham
Member since Dec 2010
410 posts
Posted on 5/5/11 at 11:41 pm to
So how did we get into talking about investing and returns instead of the huge commodities sell-of that occurred today?
Posted by tigerpawl
Can't get there from here.
Member since Dec 2003
22628 posts
Posted on 5/6/11 at 8:04 am to
This - from a Precious Metals broker.....

"The Comex is trying to cut the demand for silver to aid the shorts, and have made it very expensive to get a silver futures contract. As a result, thousands have dumped their silver futures contracts, which has flooded the market with paper silver. Not real silver, because the demand is still unbelievably strong. A silver Eagle ordered today will be delivered June 23rd, so strong is the demand. The 20% correction is not from a lesser demand, but from the Comex actions, and in my opinion, it will be very brief, and prices will go right back up and higher. I have no crystal ball, but I bought yesterday, and wouldn't dream of selling!"
Posted by foshizzle
Washington DC metro
Member since Mar 2008
40599 posts
Posted on 5/6/11 at 8:18 am to
quote:

from a Precious Metals broker.....


Is there any need to read further?
Posted by LSURussian
Member since Feb 2005
133627 posts
Posted on 5/6/11 at 8:39 am to
Nope....
Posted by Blakely Bimbo
Member since Dec 2010
1183 posts
Posted on 5/6/11 at 8:47 am to
This link has been circulating among the metals blogs. Remember everyone talks their book, but the article is interesting . I saw a very young metals trader on CNBC yesterday. The kid looked like he was 17, but was probably older. He was emphatic about how HFT (High Frequency trading) made the drops so much worse.

From the link article:
quote:

By their continued hiking of silver margins, the exchange effectively removed the liquidity in the silver market that the smaller specs have been providing. That left the market vulnerable to severe drops in price as these specs exited due to financial constraints which then removed a source of potential bids under the market as the CFTC commitments report has shown the small specs to be good buyers in the silver market.


traderdan

They can change the rules anytime they want. Always remember that when your money is at risk.


Posted by kfizzle85
Member since Dec 2005
22022 posts
Posted on 5/6/11 at 9:13 am to
quote:

They can change the rules anytime they want


Please stop saying this like there is some conspiracy going on.
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