Ha! Bet you lot are starting to get sweaty palms now. Never thought it would come down to this, did you? It would be settled long before here, wouldn’t it? They would never willfully go through with it, now would they?
You, sirs and madams, are terrible judges of character.
Yes, take the high probability bet always, even when it yields nothing and brings calamity when it falters. ‘Almost always’ does not mean the same thing as ‘always’, but the way you bunch play it, you’d think the phrases were interchangeable.
Myself, I’m perfectly comfortable here, sipping on tea like a gentleman as ERX and UCO skydive. I’m up about a percent, thus far, as my hedges run and silver rallies.
And now, a quick word to those of you pumping treasuries as a safe haven play:
Don’t think I haven’t taken notice to you. To your arguments; your revolting dedication to catch phrases handed down to you by men you can’t even recall.
Why, you fools, would treasuries rally if the U.S. Government defaults?
BECAUSE THEY’RE A SAFE HAVEN PLAY??
Do you think, maybe, just maybe, a U.S. default would challenge that assumption? Because that’s all that argument is…an assumption.
But the market is so “liquid.”
Let’s try this line of reasoning elsewhere. Imagine it’s 2008 again, and you’re looking at some Lehman Brothers stock.
“Sure,” you say, “it isn’t paying off, and the spot price is in danger of bleeding out.” Whipping your head back, you give off a barking laugh. “But just look at that VOLUME, I mean, with that much stock trading hands, the market is so liquid, it’s obviously a reliable store of value.”
“I bet, even if they announce bankruptcy, the stock will rally because people can count on it to be tradable.”
That, miscreants, is how completely injudicious you sound right now.
You need to get used to challenging these decades old rules of thumb. All of you.
If you cannot, then it is only a matter of time before you face extinction.
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Indeud, this just came to my head as maybe a play heading into the weekend…
What about a TZA TNA straddle play. You take OTM calls in both (knowingly exposing yourself to massive amounts of time decay) on the hypothesis that with a default $TZA could explode and with an agreement we should likely see equities perform quite well. Augusts of course.
nice Cain,
my widow maker TVIX is paying off today.
if treasuries are out, then cash it is.
do you follow the SHOMP, or do you think we could get a good tail spin in here for a lot more downside.
final comment. If Obama is willing to veto any “Bonner” proposition, Obama gas got to have somehting up his sleve. Maybe this 14th ammendment that everyones talking about? I dont hink he would dig his heels in unless he held the trump card. Just sayin’
thanks again.
And risk a high publicity court case going into an election?
Maybe, but a majority of the country still oppose raising the ceiling. Obama has to be aware of that; the man is constantly infatuated with his image.
I think it’s more likely they take the hit, the fallout gives leverage to force the Freshmen house members to break ranks, and then they raise the ceiling after the fact, negotiating hard with S&P and Moody’s to quickly reverse their downgrades based on “on the ground developments.”
That’s assuming the House and Senate can even get a bill to Obama. And if the House and Senate can get Boehner’s bill to the White House, I’d question Obama’s nerve to actually go through with the veto. At that point, I’d call him a liar.
nice, scare the house into a deal and then get it done. interesting to see what the frosh do.
definetly cover TVIX on a downdraft .. cheers
I came into the day long a boat of TZA calls (Fly and I were aligned – sorta – for once) so I am quite comfortable. I actually exited earlier, a touch too soon, as it turns out.
Anyway, the point I was going to make is that I don’t understand why people flock to treasuries when they are paying almost nothing. Is there something wrong with just holding cash in an account…or a mattress, for that matter? Why does money have to be “somewhere” when it could just sit on the side and not be at risk?!
Kedzilla, there are a few problems with your thoughts…first, TNA only trades monthly options, so you can’t get the same near-term impact as you can with TZA. Doing a straddle on monthlies is almost certain death, since the decay will find a way to kill you…the only way it works is if you get some major movement. Also, I personally don’t like the way TNA trades. I can’t explain that (as I’m sure there is no logic behind my thought), it just feels like TZA trades more “true” to what you expect. Again, if the market rallies hard or dives hard, you’ll get enough movement to say it was a good trade. In the end, I think you are better off straddling a strike within TZA and playing it that way…just my thoughts.
There’s nothin wrong with holding cash, except decades of cheap cliches about getting your money to work for you and a predilection for gains, even if they’re small and leave one exposed.
The US government could have taken some lessons from LTCM, what a great fund!!!
Don’t you know?
THE SPREAD ALWAYS CLOSES. Period.
When I grow up I want to be like you sir.
Btw, I blame you for my GLW loss. I tried to be like you all smart and shit.