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Archive for the ‘Market meltdown’ Category

New reserve currency

This is big trouble for the USA
WASHINGTON (AP) — Regulators on Friday shut down a Nevada bank, raising to 83 the number of U.S. bank failures this year.
The 83 closures so far this year is more than double the pace set in all of 2009, which was itself a brisk year for shutdowns. By this time last year, regulators had closed 40 banks. The pace has accelerated as banks’ losses mount on loans made for commercial property and development.

The Federal Deposit Insurance Corp. took over Nevada Security Bank, based in Reno, with $480.3 million in assets and $479.8 million in deposits. Umpqua Bank, based in Roseburg, Ore., agreed to assume the assets and deposits of the failed bank.
New reserve currency
We in Ireland are still bailing out bankrupt banks at the cost billions we don’t have causing economic depression for this and the next generation!
With 52 thousand students coming out of our universities and no jobs to go to
alone along with 100,000 people all ready left the country ,and another 53 thousand students leaving secondary education this year
How many of them are going into apprenticeships, jobs or is it emigration for the majority for them
The Unelected Cowen and his band of economic terrorists are helping the top bankers of the state live it up while the rest of us struggle to pay our monthly bills
I say let the bankrupt banks pay their own bills and allow them to fail, just like the Americans are doing in the land of Free markets
Allowing the crooks in the Dail to plunder our natural resources and the wealth of future generations is a crime I personally do not want to be responsible for, when our children ask what you did to prevent it I can show I was active in my opposition and I made a stand
What can you say you did??
It is the responsibility of each and every one of us to oppose this band of thieves we must stand up and take action
Do not just stand by and allow our country to be destroyed by the current government who have sold out to the faceless bondholders in Germany , France and England
Stand up and Fight back now!
Put yourself up for election do not give you vote to any of the current TD’s
We need new blood in the Dail and not Family dynasties
We want a general election now and we need a new community party made up of new local people from ordinary backgrounds that will work for an average wage and not clock up huge self given perks, ending up as millionaires while the rest of us struggle to pay for these perks & pensions
We need real servants of the people and not leach’s sucking the rest of us dry like some of the current shower of TD’s are doing
The next general election must end Gombeenisem for good.
Promise yourself this and we just might save Ireland!

The Markets do not believe you Mr.Cowen

 

 

Bank of Ireland [IRE  3.61    -0.14  (-3.73%)   ]
: Stay away from IRE, Cramer said. He

likened it to
National Bank of Greece
[NBG  2.23    -0.03  (-1.33%)   ]
and
Allied Irish Bank
[AIB  2.17    -0.06  (-2.69%)   ]
and said all of them “bad banks” that need
to reconstitute their balance sheets, “which means potential dilution for shareholders.”

 


Latest news is that Cramer is not a fan of any of the Irish Banks.

Bank of Ireland (IRE) and the Allied Irish Banks (AIB)

According to Cramer the Irish banks are like the National Bank of Greece so much for turning corners

Allowing Gangsters run Banks is one thing but allowing Gangsters to run a country is just unforgivable

Cowen and Lenihan must go!

Recent Market “Events”

If like me you have become puzzled by the recent Market “events” you should find this excellent article sent to me to-day helpful

Recent Market “Events”


Following quite a number of requests from students and clients this brief will deal with my understanding of what transpired last Thursday the 6th. May when just after 2.30 PM the Dow Industrials collapsed by nearly 10% and then suddenly recovered in 11 minutes.

The implications of what occurred are far reaching and unless the regulatory issues are resolved we can expect similar “events” of like nature.

In the main to comprehend the situation in the “Market” one must realise that there are now many markets. In the good old days, in America, all we had was the New York Stock Exchange where real people dealt with real market makers in real time. But computers in general and the internet in particular have changed all that. In addition as well as the “public market” we now have the (OTC) Over the Counter Market. The OTC is basically a private market between banks and large institutions which has little or no active supervision. I find this development strange because the trading activity on the OTC is 60 trillion dollars annually, while turnover on the public market is 5 trillion. Now in addition to public markets and private markets let us now bring in “Dark Pools” to our explanation.

“Dark Pools” What are they? ” Dark pools of liquidity” are crossing networks that provide liquidity that is not displayed on order books. This situation is highly advantageous for institutions that wish to trade very large numbers of shares without showing their hand. Dark liquidity pools thus offer institutions many of the efficiencies associated with trading on the exchanges’ public limit order books but without showing their actions to other parties. This is achieved because neither the price nor the identity of the trading entity needs to be displayed. Many of the OTC “exchanges ” used by the dark pools use high frequency trading programmes to minimise order size and maximise order execution. Now you may think that this manner of doing business on the “stock market” is carried out by minor unknown entities but this is not the case. Below I list the Independent dark pools, the broker-dealer dark pools and exchange-owned dark pools.

Independent dark pools: Instinet, Smartpool, Posit, Liquidnet, Nyfix,Pulse Trading, RiverCross

and Pipeline Trading.

Broker-dealer dark pools: BNP Paribas, Bank of New York Mellon, Citi, Credit Suisse, Fidelity, Goldman Sachs, Knight Capital, Deutsch Bank, Merrill Lynch, Morgan Stanley, USB, Ballista ATS, BlocSec and Bloomberg.

Exchange-owned dark pools: International Securities Exchange, NYSE Euronext, BATS Trading and Direct Edge.

When you understand that all the big players in banking and finance are using the OTC system and have a turnover 12 times that of the “public” markets you get to wonder why there is a New York Stock Exchange at all. Well you see there is a big difference between the OTC “private” market and the NYSE “public” market. The NYSE is comprised of market makers. These market makers are specialists who are obliged to buy and sell on their own and the publics’ account to create a liquid active market. The OTC market faces no such obligation. Over the past number of years attempts have been made to abolish the specialist role and remove the “human” engagement.

What happened on Thursday was the high frequency OTC trading programmes

created “trades” which did not make sense to the NYSE specialists. Accordingly the NYSE stopped handling orders so that the situation could be analysed. The OTC computerized networks then began rerouting orders to other “markets” and with no “public” markets participating prices collapsed through sell stops and the rest is history.

There are many lessons to be learned from this event. But for me the main question is whether a “market” that is only 8% “transparent” is actually a market (5 trillion as a ratio of 60 trillion). Going forward it is obvious that additional “circuit breakers” must be brought in to modify the exchange activity of high frequency dark pools. Whatever the eventual fallout from last Thursday’s events are it is clear that the issues I have touched upon are only the tip of the iceberg and any trader or investor worth his salt must reflect upon what happened and adjust his or her strategies appropriately.

Wealthbuilder.ie


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