Big Wave Wipe-Out, The Number of the Bear
Surfers of big waves risk terrible wipe-outs.
Here's a chart of XIV:
Link: XIV is going to be the first big ETF blow-up and Credit Suisse is going to be hit hard
Several major hedge funds had extreme exposure to volatility, and will go bust because of this. Imagine what that might do to global stock markets.
"The surge in volatility has already claimed one victim: Nomura Europe Finance announced the early redemption of its Next Notes S&P 500 VIX Short-Term Futures Inverse Daily Excess Return Index ETN, which had 32.4 billion yen (approximately $300 million) in assets."
Link: XIV trader: ‘I’ve lost $4 million, 3 years of work and other people’s money’
It's interesting, and perhaps a bit frightening, to note that at the end of the '08 crash the S&P bottomed at 666 and Friday's drop in the DJIA, which may have kicked-off the next big crash, was 666 points.
Those who fail to learn from their mistakes prefer to blame someone or something for the consequences of their imprudence.
Satan didn't cause this recent dip in the markets. It wasn't politics or "F.B.I. memos" or fear that good news will bring rising interest rates. The volatile swings of the past few days were not caused by computer trading or "black pools" or any such assertion. Trading patterns looked exactly the same decades before computers were invented.
Human nature hasn't changed. Fear and greed are eternal.
People incessantly buying in a mania driving prices ever higher the past several years wasn't blamed on anything, and people selling in panic because they can't afford to cover their margin debt needs no imaginary bogeyman explanation either.
This was very long overdue, as even a casual perusal of posts from the past few weeks or months on this blog will prove.
Boom & bust. What goes up must come down. It's not different this time.
XIV was $5 in late 2011. It hit a low of $5.50 today. Many more will go full circle.
Here's a chart of XIV:
Link: XIV is going to be the first big ETF blow-up and Credit Suisse is going to be hit hard
Several major hedge funds had extreme exposure to volatility, and will go bust because of this. Imagine what that might do to global stock markets.
"The surge in volatility has already claimed one victim: Nomura Europe Finance announced the early redemption of its Next Notes S&P 500 VIX Short-Term Futures Inverse Daily Excess Return Index ETN, which had 32.4 billion yen (approximately $300 million) in assets."
Link: XIV trader: ‘I’ve lost $4 million, 3 years of work and other people’s money’
It's interesting, and perhaps a bit frightening, to note that at the end of the '08 crash the S&P bottomed at 666 and Friday's drop in the DJIA, which may have kicked-off the next big crash, was 666 points.
Those who fail to learn from their mistakes prefer to blame someone or something for the consequences of their imprudence.
Satan didn't cause this recent dip in the markets. It wasn't politics or "F.B.I. memos" or fear that good news will bring rising interest rates. The volatile swings of the past few days were not caused by computer trading or "black pools" or any such assertion. Trading patterns looked exactly the same decades before computers were invented.
Human nature hasn't changed. Fear and greed are eternal.
People incessantly buying in a mania driving prices ever higher the past several years wasn't blamed on anything, and people selling in panic because they can't afford to cover their margin debt needs no imaginary bogeyman explanation either.
This was very long overdue, as even a casual perusal of posts from the past few weeks or months on this blog will prove.
Boom & bust. What goes up must come down. It's not different this time.
XIV was $5 in late 2011. It hit a low of $5.50 today. Many more will go full circle.
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posted by C. Guinness @ 2:12 AM
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