Black Monday - Apparently

chewmylegoff

Graham_Devon wrote: »

So FTSE futures are now my prediction?

Righty-o. Jog on.

FTSE futures are not a prediction of anything at all, you have added the prediction. I now suspect you have done this unwittingly...

Generali

wotsthat wrote: »

I'd hazard a guess that much of the money made in the markets is made on trading costs. People buying and holding aren't very profitable.

Broking is a great business, just taking a little clip off each trade.

At one broker- dealer I worked at we settled a millon trades in a day and just took a little tiny commission off each one with very little risk and pretty much no capital used to support the business either (capital is a huge cost for a bank).:money:

The bank ended up being nationalised by the regulating Government. Bloody fixed income blokes couldn't keep their hands in their pockets.

wotsthat

Graham_Devon wrote: »

It's what it was showing at the time of my post.

So FTSE futures are now my prediction?

Righty-o. Jog on.

FTSE futures aren't a predictor of the future of the FTSE.

It's why people are more relaxed than you might have expected. Most people realise that if there was a reliable method of predicting BT was going to be £5 today then it would have been £5 yesterday.

If someone has a reliable way of predicting the future (that no one else knows about) they can make a fortune. Maybe they walk the earth but you won't find them getting up at 5am to talk on Bloomberg, writing articles for newspapers or charging a subscription to share their insight.

My bet isn't on short term share price movements but on collectives of clever humans being able to generate profits over the long term. I can't call share price movements, don't try to and, in the main, don't worry about having to tell myself stories to explain the randomness of existence.

chucknorris

wotsthat wrote: »

It's why people are more relaxed than you might have expected. Most people realise that if there was a reliable method of predicting BT was going to be £5 today then it would have been £5 yesterday.

Please don't say things like that, BT was my only single company share that I sold just a few months ago.

cells

pretty much all of finance business economics and even science is about predicting the future

wotsthat

cells wrote: »

pretty much all of finance business economics and even science is about predicting the future

I can predict night will follow day and will be correct every day for the next few billion years. Can't predict what the FTSE will be this time next week with any degree of certainty.

As outcomes tend towards randomness (or more likely as the variables increase) the more difficult it is to predict.

shinkyshonky

It makes me smile when some twonk from some hedgefund/share company goes on the news and says it will not effect us, and quotes stats etc, everything is robust etc, as someone quoted above , certain people need a narrative, perhaps hourly, of what they think they need to hear, meanwhile in the real world....

Graham_Devon

Well - massive rise on the DOW today. Seems some of it is attributed to one policy maker in the US suggesting that the case for raising rates looks less compelling. The DOW closed just shy of 4% up. The third largest increase in points in the DOWs history.

Funnily enough in the same speech, he suggested it was important not to react to short term market developments. It appears that's exactly what he did!

Does all this show just how sensitive the markets are to a rate rise though? A simple announcement that they may not put them up as quick as they may have done (remember, no one said they would actually raise them) and you have a massive upswing.

I quite like this from a finance feed...

The Dow is up more than 500 points, because truly, for absolute certain, nobody has any idea what’s going on.

Thrugelmir

Graham_Devon wrote: »

Does all this show just how sensitive the markets are to a rate rise though?

Markets react to events. Always have done and always will do. Volatility is nothing new. If anything it's what you'd expect. As investors digest news and take polarised views.

wotsthat

Graham_Devon wrote: »

Well - massive rise on the DOW today. Seems some of it is attributed to one policy maker in the US suggesting that the case for raising rates looks less compelling. The DOW closed just shy of 4% up.

Funnily enough in the same speech, he suggested it was important not to react to short term market developments. It appears that's exactly what he did!

Does all this show just how sensitive the markets are to a rate rise though? A simple announcement that they may not put them up as quick as they may have done (remember, no one said they would actually raise them) and you have a massive upswing.

The massive upswing at a potential delay in increased rates and yet the DOW is the lowest level it's been for a year. Does that mean the markets are worried about rates going up, going down or not at all?