UK Stockmarket 2009 and beyond

tradetime

Peston says RBS might be worth 1bn more now. GS would have to pay that back maybe but surely not paulson

Well I'm still trying to work out exactly what the issue is here.
Example, when you buy a security that is trading on a market, you presumably do so because you have examined that security either fundamentally or technically, or whatever and you believe it will go up.
You have no idea who you are buying it off, and what their position is. You may be buying it from a short seller. So if it goes down and you lose money, it it the short seller's fault? Maybe the broker's fault, who let you buy it?
The media loving it though.

sabretoothtigger

This is a managed fund though. If the bonds had been bought separately on the free market then buyer beware but if its a bundle of them cdo style and packaged and detailed by GS then they are the sellers and apparently guilty of apparently not giving fair disclosure on a number of facts

Seems a bit similar to that gartmore frontselling his own fund. They gained personally from privileged information as they not only packaged the deal they were also involved as a short seller of it based on information not given to the people buying it

Apparently Goldman does frontsell its clients as well





My view of Silver I do think its good for a fall though I guess Im thinking it will stay above the Feb low now, the miners themselves might not

[Deleted User]

remember what happened in the US!!

http://business.timesonline.co.uk/tol/business/industry_sectors/construction_and_property/article7098996.ece

tradetime

Apparently Goldman does frontsell its clients as well

Not 100% sure I know what you mean by that so sorry if I've got hold of the wrong end of the stick. Goldman is an Investment bank, and like many investment banks (most if not all) it frequently acts as principle. When a firm acts as principle it will usually be on the other side of the trade irrespective of what its own view on that trade is, until it can lay off the trade to another interested party or hedge it.

In this case Goldman it seems found buyers for this junk, all those "clever talented people" "the best of the best" as Meredith Whitney calls them, and tells us that we need to pay massive bonuses to keep.

cloud_dog

tradetime wrote: »

I blame cloud_dog personally

Hey, I was relying on your reading of the indexes (indecies)

EDIT: Note to self...... Do what Kitty does:T

atypical

tradetime wrote: »

Goldman it seems found buyers for this junk

But only by (allegedly) misrepresenting what they were selling. These people thought they were buying a package of securities selected by an independent, objective third party (ACA). In fact they were selected by a hedge fund (Paulson) whose interest it was to see the thing fail.

The VP of Goldman also allegedly misled ACA into thinking Paulson was long $200m for the CDO (right terminology?) when they were shorting it.

tradetime

atypical wrote: »

But only by (allegedly) misrepresenting what they were selling. These people thought they were buying a package of securities selected by an independent, objective third party (ACA). In fact they were selected by a hedge fund (Paulson) whose interest it was to see the thing fail.

The VP of Goldman also allegedly misled ACA into thinking Paulson was long $200m for the CDO (right terminology?) when they were shorting it.

It will be a while before we know the truth of exactly what was going on. As much as I have contempt for banks, I am also aware that throughout this crisis Goldman Sachs has been the target of politicians in the US playing to the public outrage, which the media has happily fueled.
Even now when they talk about the buyers of the CDO's they say things like; "If they'd have known they were going up against John Paulson, they wouldn't have been in this trade." Which may be right or wrong, in so much as if they'd known they were up against a large hedge fund they may have thought twice, but that would be it. The fact that it was some guy called Paulson wouldn't have made a difference beyond that, like the media likes to suggest, since John Paulson's claim to fame was in the aftermath of this position. Prior to that he was nobody, just an obscure hedge fund manager. When you have that much spin around the story it pays to be skeptical until facts are proven.

Mary Schapiro is new to the SEC as chair, out to prove the effectiveness of the organization after the Madoff debacle, it would not be a huge leap given the political maneuvering to wonder if she could be being used.

Then of course we have to say, if Paulson was involved in the selection of the bonds going into the index (not that that is good practice of course), and was smart enough to work out which ones were likely to fail, then the buyers should have been smart enough to work that out too.
One of his main counter-parties was German bank IKB, part of whose business was real estate financing, so they weren't exactly playing away from their game.

I just hate the political spin that comes with these cases, the public showboating by politicians, because it's usually a distraction to focus our attention on one place, while a plethora of other things are quietly swept under the carpet. Such as distracting the publics attention from governments own failure with Fannie Mae, and Freddie Mac.

tradetime

cloud_dog wrote: »

Hey, I was relying on your reading of the indexes (indecies)

Hehe you want to be careful doing that , guess what, my read on the indices longer term hasn't changed markedly yet. Short term, perhaps, but markets are fluid, and short term views have to continually adjust and react.
Look at it from this perspective. The Indices are up some 70% ish from the bottom, how much of that move is related to Goldman?
So if Goldman wasn't the catalyst and driving force of the move up, then how much is Goldman's woes likely to affect what were the catalysts and drivers. Not an awful lot is my guess, this will have zero effect on CPI, PPI, Industrial Production, Housing, Unemployment, Manufacturing, Maybe it will have some effect on sentiment, maybe it is an excuse for profit taking that leads to the long awaited correction, ...maybe. Was an ugly day for Goldman investors, that's for sure.

cloud_dog

I'm not expecting this to turn in to a sizable correction so am happy tohold, I'm still not fully invested so expect to use this as the opportunity to do so.

sabretoothtigger

Ditto, the trend will hold just like it did in Feb though I didnt manage to recognise that at the time.
Next week I expect this to go back up, it may have trouble at a similar point and maybe they'll be news or not but only after its stalled at altitude continually is it really ready to plunge, engines still running right now.

The most bearish thing is one observation that people are trying to game the dip almost immediately which is a reason for it to become more then a dip

since John Paulson's claim to fame was in the aftermath of this position

Yea very much so. I still think this could be healthy reform though. The main reason for a justified fall back would be if this was the start of many similar investigations and restrictions of bank activities.

Im not for regulation so much but transparency and disclosure are part of a free market or it becomes something else with too many people playing the market with advantages.
I see focus moving away from nyse and ftse eventually anyway



I cant find a link for it but I read a very reasonable point saying that coal is a better commodity then oil to invest in longer term as it will follow global gdp better.

The reasoning being oil is a managed market, the supply is controlled and the present price is consequently artificially inflated.
We are all so used to this we dont consider it anymore really. Where as coal is a free market and more likely to appreciate as it contains more energy then any other type of carbon fuel apparently

http://www.telegraph.co.uk/finance/newsbysector/energy/6896140/Old-King-Coal-will-stay-on-the-commodities-throne-for-years.html


Also Iraq is not in OPEC (yet) and I think most likely it has the largest stores of oil in the world. It might take decades to develop but eventually its more then able to supply large amounts of oil so we have increasing oil supply most likely this is not accounted for in the price
Maybe this is Shells reasoning
GPX HOIL and GKP are iraqi oil explorers




Australian coal mine of a type where exposure to the air causes it to heat up and ignite





Green on my screen yesterday

hgm
gpx
ko
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kmr
yau
cxe
ciu
djan
hyc
tep
pru
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ung
eur/gbp
uup

tech
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