Believe me I know what TIZ said was not a good situation, but my WORST CASE thoughts was even worse then the case TIZ made.
Believe me I know what TIZ said was not a good situation, but my WORST CASE thoughts was even worse then the case TIZ made.
Apple & Amazon should go after college textbooks market. It's a huge industry and right now it's a monopoly business, I hate that. Students can download just about anything with iPad/KinderFire. But when it comes to textbooks, schools are forcing them to spend $600-$800/semester for those shits that they never ever touch them again when they're done w/the semester. Corruption at its best.
Here we go again, when nothing else works, there is always short selling ban, trading curb, circuit breaker rule...etc. LMAO!@!@ The dealers must be protected at all costs...
SEC Approves Exchange Proposal to Adjust U.S. Trading Curbs
By Nina Mehta - Jun 2, 2012 2:17 AM CT
The Securities and Exchange Commission approved two proposals to alter trading curbs meant to curtail volatility in the U.S. stock market.
The regulator approved a system known as limit-up/limit- down that prevents trades at prices outside a specified band, according to a statement on the SEC website yesterday. It also backed changes to broader circuit breakers instituted after the 1987 market crash that halt exchange-listed securities in U.S. markets during periods of volatility. Both programs will be implemented on Feb. 4 for a one-year pilot period.
Enlarge image
All U.S. stock trading will halt when the Standard & Poor’s 500 Index falls 7 percent. Photographer: Scott Eells/Bloomberg
U.S. stock exchanges and the Financial Industry Regulatory Authority, which oversees more than 4,400 brokers, introduced curbs for individual stocks after the May 2010 rout known as the flash crash to halt shares when they rise or fall at least 10 percent in five minutes. Exchanges asked for permission 13 months ago to test the limit-up/limit-down system and updated their proposal on May 24.
“Limit-up/limit-down will make incremental but material improvements to the single-stock circuit breaker plan,” Jamie Selway, head of liquidity management at New York-based Investment Technology Group Inc., said in a phone interview. “Halts won’t go off for goofy reasons as much as they have in the past and limit-up/limit-down will work a lot better in the context of a flash crash. The marketwide circuit breaker changes also provide helpful improvements to the legacy approach.”
Flash Crash
By the time the updated programs are in place, almost three years will have passed since the flash crash. Selway said the SEC took too long to approve the changes.
“The initiatives we approved are the product of a significant effort to devise a sophisticated, yet workable and effective way to protect our markets from excessive volatility,” SEC Chairman Mary Schapiro said in the statement. “In today’s complex electronic markets, we need an automated and appropriately calibrated way to pause or limit trading if prices move too far too fast.”
Under the limit-up/limit-down system, which will replace the current practice of immediate halts when prices for individual securities become volatile, trades won’t be allowed to take place more than a specified percentage above or below the average price over the preceding five-minute period. If trading isn’t able to occur within the price band for more than 15 seconds, a five-minute halt will ensue, the SEC said.
Price Bands
Each stock will be allowed to move a certain percentage from its five-minute average, with the amount varying based on its closing price the prior day.
The price band will be 5 percent above and below for stocks higher than $3 in the Standard & Poor’s 500 Index (SPX) and Russell 1000 Index and a group of about 430 exchange-traded products, the SEC said. It will be 10 percent for other securities higher than $3. Those between 75 cents and $3 can move up to 20 percent, while those less than 75 cents can move the lesser of 75 percent or 15 cents.
The plan will be implemented in two phases. It will initially apply to S&P 500 and Russell 1000 stocks and the group of ETPs, with price bands calculated from 9:45 a.m. New York time until 3:30 p.m. The second phase, which will start six months later, will operate from the start of trading at 9:30 a.m. until the close at 4 p.m. and apply to all securities.
‘Normal’ Trading
The limit-up/limit-down plan will also give the market that lists a security the discretion to declare a trading pause when a stock has “deviated from its normal trading characteristics” and the exchange decides that a halt would curtail excessive volatility, the SEC said. This will ensure a company’s shares don’t “remain impaired” indefinitely, it said.
The commission said it expects exchanges will eliminate the volatility curbs that apply only on their own venues. The New York Stock Exchange currently has a system of so-called liquidity replenishment points to limit rapid price moves on its market. NYSE Euronext (NYX) Chief Operating Officer Larry Leibowitz has credited the system with preventing stocks his company lists from trading at aberrant prices such as pennies during the flash crash.
The exchanges and Finra will create an advisory committee with representatives from a retail broker, institutional securities firm, alternative trading platform and an investor to offer their views on prospective changes to the limit-up/limit- down system. While the committee can’t vote, “it’s nice to have their input hard-coded into the process,” Selway said. The exchanges and Finra told the SEC in a Nov. 2 letter that advisers were unnecessary.
1987 Crash
The SEC also changed the marketwide circuit breakers, created in the aftermath of the October 1987 crash, because they weren’t triggered during the May 6, 2010, rout that erased $862 billion from U.S. equities in less than 20 minutes. The alterations will make the curbs “more meaningful and effective in today’s high-speed electronic securities markets,” the agency said in its approval order.
All U.S. securities trading will halt for 15 minutes when the S&P 500 falls 7 percent before 3:25 p.m. The trigger is currently a 10 percent drop in the Dow Jones Industrial Average. The proposal also shortens the length of most halts and modifies the times when the circuit breaker can be triggered. A plunge of 20 percent will cause all trading to stop for the day. The marketwide pause has been triggered only once, on Oct. 27, 1997.
Nobel Prize
An advisory committee to the SEC and Commodity Futures Trading Commission recommended changing the marketwide system. The advisers included Joseph Stiglitz, an economist who won the Nobel Prize; David Ruder, a former SEC chairman; Brooksley E. Born, who was chairman of the CFTC; and John J. Brennan, chairman emeritus and senior adviser at Vanguard Group Inc.
The owner of the Chicago Mercantile Exchange is examining the SEC’s approval of the marketwide circuit breakers, Michael Shore, a spokesman for CME Group Inc. (CME), wrote in an e-mail. The company has circuit breakers for equity-index futures that are consistent with those in the stock market.
“CME Group has been a strong advocate for more appropriately calibrated marketwide circuit breaker trigger levels that are coordinated across trading venues,” Shore said. “We have commented extensively on the proposals, are currently evaluating the changes approved by the SEC and will be submitting proposed amendments to our rules in the near future.”
The lack of a linkage between the curbs for individual securities and those that halt all trading is a risk, Selway said. CME Group and the Securities Industry and Financial Markets Association urged the SEC to allow marketwide curbs to be triggered if a sufficient number of individual stocks are halted since that may affect the calculation of indexes. The SEC said market participants could submit comments about this issue while the programs are being tested.
To contact the reporter on this story: Nina Mehta in New York at nmehta24@bloomberg.net
To contact the editor responsible for this story: Nick Baker at nbaker7@bloomberg.net
SEC Approves Exchange Proposal to Adjust U.S. Trading Curbs
By Nina Mehta - Jun 2, 2012 2:17 AM CT
The Securities and Exchange Commission approved two proposals to alter trading curbs meant to curtail volatility in the U.S. stock market.
The regulator approved a system known as limit-up/limit- down that prevents trades at prices outside a specified band, according to a statement on the SEC website yesterday. It also backed changes to broader circuit breakers instituted after the 1987 market crash that halt exchange-listed securities in U.S. markets during periods of volatility. Both programs will be implemented on Feb. 4 for a one-year pilot period.
Enlarge image
All U.S. stock trading will halt when the Standard & Poor’s 500 Index falls 7 percent. Photographer: Scott Eells/Bloomberg
U.S. stock exchanges and the Financial Industry Regulatory Authority, which oversees more than 4,400 brokers, introduced curbs for individual stocks after the May 2010 rout known as the flash crash to halt shares when they rise or fall at least 10 percent in five minutes. Exchanges asked for permission 13 months ago to test the limit-up/limit-down system and updated their proposal on May 24.
“Limit-up/limit-down will make incremental but material improvements to the single-stock circuit breaker plan,” Jamie Selway, head of liquidity management at New York-based Investment Technology Group Inc., said in a phone interview. “Halts won’t go off for goofy reasons as much as they have in the past and limit-up/limit-down will work a lot better in the context of a flash crash. The marketwide circuit breaker changes also provide helpful improvements to the legacy approach.”
Flash Crash
By the time the updated programs are in place, almost three years will have passed since the flash crash. Selway said the SEC took too long to approve the changes.
“The initiatives we approved are the product of a significant effort to devise a sophisticated, yet workable and effective way to protect our markets from excessive volatility,” SEC Chairman Mary Schapiro said in the statement. “In today’s complex electronic markets, we need an automated and appropriately calibrated way to pause or limit trading if prices move too far too fast.”
Under the limit-up/limit-down system, which will replace the current practice of immediate halts when prices for individual securities become volatile, trades won’t be allowed to take place more than a specified percentage above or below the average price over the preceding five-minute period. If trading isn’t able to occur within the price band for more than 15 seconds, a five-minute halt will ensue, the SEC said.
Price Bands
Each stock will be allowed to move a certain percentage from its five-minute average, with the amount varying based on its closing price the prior day.
The price band will be 5 percent above and below for stocks higher than $3 in the Standard & Poor’s 500 Index (SPX) and Russell 1000 Index and a group of about 430 exchange-traded products, the SEC said. It will be 10 percent for other securities higher than $3. Those between 75 cents and $3 can move up to 20 percent, while those less than 75 cents can move the lesser of 75 percent or 15 cents.
The plan will be implemented in two phases. It will initially apply to S&P 500 and Russell 1000 stocks and the group of ETPs, with price bands calculated from 9:45 a.m. New York time until 3:30 p.m. The second phase, which will start six months later, will operate from the start of trading at 9:30 a.m. until the close at 4 p.m. and apply to all securities.
‘Normal’ Trading
The limit-up/limit-down plan will also give the market that lists a security the discretion to declare a trading pause when a stock has “deviated from its normal trading characteristics” and the exchange decides that a halt would curtail excessive volatility, the SEC said. This will ensure a company’s shares don’t “remain impaired” indefinitely, it said.
The commission said it expects exchanges will eliminate the volatility curbs that apply only on their own venues. The New York Stock Exchange currently has a system of so-called liquidity replenishment points to limit rapid price moves on its market. NYSE Euronext (NYX) Chief Operating Officer Larry Leibowitz has credited the system with preventing stocks his company lists from trading at aberrant prices such as pennies during the flash crash.
The exchanges and Finra will create an advisory committee with representatives from a retail broker, institutional securities firm, alternative trading platform and an investor to offer their views on prospective changes to the limit-up/limit- down system. While the committee can’t vote, “it’s nice to have their input hard-coded into the process,” Selway said. The exchanges and Finra told the SEC in a Nov. 2 letter that advisers were unnecessary.
1987 Crash
The SEC also changed the marketwide circuit breakers, created in the aftermath of the October 1987 crash, because they weren’t triggered during the May 6, 2010, rout that erased $862 billion from U.S. equities in less than 20 minutes. The alterations will make the curbs “more meaningful and effective in today’s high-speed electronic securities markets,” the agency said in its approval order.
All U.S. securities trading will halt for 15 minutes when the S&P 500 falls 7 percent before 3:25 p.m. The trigger is currently a 10 percent drop in the Dow Jones Industrial Average. The proposal also shortens the length of most halts and modifies the times when the circuit breaker can be triggered. A plunge of 20 percent will cause all trading to stop for the day. The marketwide pause has been triggered only once, on Oct. 27, 1997.
Nobel Prize
An advisory committee to the SEC and Commodity Futures Trading Commission recommended changing the marketwide system. The advisers included Joseph Stiglitz, an economist who won the Nobel Prize; David Ruder, a former SEC chairman; Brooksley E. Born, who was chairman of the CFTC; and John J. Brennan, chairman emeritus and senior adviser at Vanguard Group Inc.
The owner of the Chicago Mercantile Exchange is examining the SEC’s approval of the marketwide circuit breakers, Michael Shore, a spokesman for CME Group Inc. (CME), wrote in an e-mail. The company has circuit breakers for equity-index futures that are consistent with those in the stock market.
“CME Group has been a strong advocate for more appropriately calibrated marketwide circuit breaker trigger levels that are coordinated across trading venues,” Shore said. “We have commented extensively on the proposals, are currently evaluating the changes approved by the SEC and will be submitting proposed amendments to our rules in the near future.”
The lack of a linkage between the curbs for individual securities and those that halt all trading is a risk, Selway said. CME Group and the Securities Industry and Financial Markets Association urged the SEC to allow marketwide curbs to be triggered if a sufficient number of individual stocks are halted since that may affect the calculation of indexes. The SEC said market participants could submit comments about this issue while the programs are being tested.
To contact the reporter on this story: Nina Mehta in New York at nmehta24@bloomberg.net
To contact the editor responsible for this story: Nick Baker at nbaker7@bloomberg.net
Full presentation can be found over at ZH
Just for fun/worst case since we talking about end games.... doubt it completely blows up and if it does not this soon
----------
"The End Game: 2012 And 2013 Will Usher In The End" - The Scariest Presentation Ever?
Submitted by Tyler Durden on 05/31/2012 20:01 -0400
Bond China ETC Fractional Reserve Banking Germany Goldman Sachs goldman sachs Gross Domestic Product Japan United Kingdom
If Raoul Pal was some doomsday spouting windbag, writing in all caps, arbitrarily pasting together disparate charts to create 200 page slideshows, it would be easy to ignore him. He isn't. The founder of Global Macro Investor "previously co-managed the GLG Global Macro Fund in London for GLG Partners, one of the largest hedge fund groups in the world. Raoul came to GLG from Goldman Sachs where he co-managed the hedge fund sales business in Equities and Equity Derivatives in Europe... Raoul Pal retired from managing client money in 2004 at the age of 36 and now lives on the Valencian coast of Spain, from where he writes." It is his writing we are concerned about, and specifically his latest presentation, which is, for lack of a better word, the most disturbing and scary forecast of the future of the world we have ever seen....
And we see a lot of those.
Consider this:
We are here...
We don’t know exactly what is to come, but we can all join the very few dots from where we are now, to the collapse of the first major bank…
With very limited room for government bailouts, we can very easily join the next dots from the first bank closure to the collapse of the whole European banking system, and then to the bankruptcy of the governments themselves.
There are almost no brakes in the system to stop this, and almost no one realises the seriousness of the situation.
The problem is not Government debt per se. The real problem is that the $70 trillion in G10 debt is the collateral for $700 trillion in derivatives…
Yes, that equates to 1200% of Global GDP and it rests on very, very weak foundations
From an EU crisis, we only have to join one dot for a UK crisis of equal magnitude.
And then do you think Japan and China would not be next?
And then do you think the US would survive unscathed?
That is the end of the fractional reserve banking system and of fiat money.
It is the big RESET.
It continues:
Bonds will be stuck at 1% in the US, Germany, UK and Japan (for this phase).
The whole bond market will be dead.
Short selling on bonds - banned
Short selling stocks – banned
CDS – banned
Short futures – banned
Put options – banned
All that is left is the Dollar and Gold
It only gets better. We use the term loosely:
We have around 6 months left of trading in Western markets to protect ourselves or make enough money to offset future losses.
Spend your time looking at the risks of custody, safekeeping, counterparty etc. Assume that no one and nothing is safe.
After that…we put on our tin helmets and hide until the new system emerges
And the punchline
From a timing perspective, I think 2012 and 2013 will usher in the end.
Enjoy:
*
Just for fun/worst case since we talking about end games.... doubt it completely blows up and if it does not this soon
----------
"The End Game: 2012 And 2013 Will Usher In The End" - The Scariest Presentation Ever?
Submitted by Tyler Durden on 05/31/2012 20:01 -0400
Bond China ETC Fractional Reserve Banking Germany Goldman Sachs goldman sachs Gross Domestic Product Japan United Kingdom
If Raoul Pal was some doomsday spouting windbag, writing in all caps, arbitrarily pasting together disparate charts to create 200 page slideshows, it would be easy to ignore him. He isn't. The founder of Global Macro Investor "previously co-managed the GLG Global Macro Fund in London for GLG Partners, one of the largest hedge fund groups in the world. Raoul came to GLG from Goldman Sachs where he co-managed the hedge fund sales business in Equities and Equity Derivatives in Europe... Raoul Pal retired from managing client money in 2004 at the age of 36 and now lives on the Valencian coast of Spain, from where he writes." It is his writing we are concerned about, and specifically his latest presentation, which is, for lack of a better word, the most disturbing and scary forecast of the future of the world we have ever seen....
And we see a lot of those.
Consider this:
We are here...
We don’t know exactly what is to come, but we can all join the very few dots from where we are now, to the collapse of the first major bank…
With very limited room for government bailouts, we can very easily join the next dots from the first bank closure to the collapse of the whole European banking system, and then to the bankruptcy of the governments themselves.
There are almost no brakes in the system to stop this, and almost no one realises the seriousness of the situation.
The problem is not Government debt per se. The real problem is that the $70 trillion in G10 debt is the collateral for $700 trillion in derivatives…
Yes, that equates to 1200% of Global GDP and it rests on very, very weak foundations
From an EU crisis, we only have to join one dot for a UK crisis of equal magnitude.
And then do you think Japan and China would not be next?
And then do you think the US would survive unscathed?
That is the end of the fractional reserve banking system and of fiat money.
It is the big RESET.
It continues:
Bonds will be stuck at 1% in the US, Germany, UK and Japan (for this phase).
The whole bond market will be dead.
Short selling on bonds - banned
Short selling stocks – banned
CDS – banned
Short futures – banned
Put options – banned
All that is left is the Dollar and Gold
It only gets better. We use the term loosely:
We have around 6 months left of trading in Western markets to protect ourselves or make enough money to offset future losses.
Spend your time looking at the risks of custody, safekeeping, counterparty etc. Assume that no one and nothing is safe.
After that…we put on our tin helmets and hide until the new system emerges
And the punchline
From a timing perspective, I think 2012 and 2013 will usher in the end.
Enjoy:
*
So how do you guys see this all playing out the rest of this year in to 2013?
List a sequence of events that you guys see happening which will lead to the endgame. Where is the place to be to protect your money/wealth?
I pulled out of market in 2010 (Much earlier than I thought) but I just had no trust or faith in the system anymore. The news that has moved the markets over the last several months has proven to me I made the right decision, even though I jumped the gun a bit early, but I just couldnt trust the market system anymore nor did I know when the bottom would truly fall out. (Ie......Stocks down on Greek worries, Stocks bounce back as Greek deal looms, Greece in trouble-- stocks hammered, Positive outlook for Greece-- stocks show gains, Greece near collpase-- stocks tank, blah, blah, blah........Greece is screwed IMO and I dont see how this dog and pony show can continue on spiking the markets up and down.) I also dont see how you can have a free market system that reflects real value when you have a plunge protection team in place to safeguard the markets..........I'd rather invest in sports betting and coins.
List a sequence of events that you guys see happening which will lead to the endgame. Where is the place to be to protect your money/wealth?
I pulled out of market in 2010 (Much earlier than I thought) but I just had no trust or faith in the system anymore. The news that has moved the markets over the last several months has proven to me I made the right decision, even though I jumped the gun a bit early, but I just couldnt trust the market system anymore nor did I know when the bottom would truly fall out. (Ie......Stocks down on Greek worries, Stocks bounce back as Greek deal looms, Greece in trouble-- stocks hammered, Positive outlook for Greece-- stocks show gains, Greece near collpase-- stocks tank, blah, blah, blah........Greece is screwed IMO and I dont see how this dog and pony show can continue on spiking the markets up and down.) I also dont see how you can have a free market system that reflects real value when you have a plunge protection team in place to safeguard the markets..........I'd rather invest in sports betting and coins.
Bernanke is running out of options. ZIRP is useless, Operation Twist is not working. He needs a SHOCK-N-AWE liquidity storm, hurricane, or Operation TWISTER. Print $3t-$5t immediately and buying everything from Treasuries, MBS, corporate bonds, sovereign bonds, junk bonds....bailing out the world. Combining Freddie, Fannie, and USPS into one operation, set-up Bernanke & Co Federal Credit Union, offering low or next to zero % 15/30 yrs fixed rate mortgages to low income earners, re-inflating the housing bubble, giving artificial growth another boost....print and spend to infinity. Yippppeeeee!!!!
Thats what your boy AK has been saying for a while now.
Does anyone have any opinion on real estate in this thread?
I know everyone sees assets like that devaluing because of lack of jobs but 3% for a 15yr mortgage and 3.7% for a 30 year? Damn that is some cheap $. You can pretty much rent a 3/2 in a lot of places and break even on a 15yr mortgage. Not sure when before in our history was that possible? If property goes up 3% and everything else breaks even and house gets paid off in 15 years, thats gotta be like 12-14% return on investment give or take..
I know everyone sees assets like that devaluing because of lack of jobs but 3% for a 15yr mortgage and 3.7% for a 30 year? Damn that is some cheap $. You can pretty much rent a 3/2 in a lot of places and break even on a 15yr mortgage. Not sure when before in our history was that possible? If property goes up 3% and everything else breaks even and house gets paid off in 15 years, thats gotta be like 12-14% return on investment give or take..
It was a joke. And the kid is a classic brainwashed sheep of Keynesian flawed economy theory. I want the economy to grow, however, I prefer an organic and sustainable growth, not artificial growth with cheap liquidity and easy credit. We should never be where we're at if there wasn't centrally planned economy run by the DC crooks. Tech bubble, housing bubble, endless wars...etc...you name it. Ultimately, anything that centrally planned will FAIL.
Make no mistake, Keynesian theory has nothing to do with economy, it's no more than a propaganda and politicians use it every well, essentially, it's turning majority of society into dependents of the government. It's easier to control and govern the masses when they're government dependents.
With gloomy job market, housing will slide further IMO. There are lots of bargains in the market right now, and the interest rates are at historic low, it's a perfect time to buy a house right now. States and locals can stop the sliding if they don't impose property taxes for vacant homes. Property taxes is the only thing that hold back the investors. They can afford home insurance/maintenance. But unless you can rent your property, the tax bill is just too much.
Yeah it would not make sense to buy w/o renting anyway. The point of the low interest rates is to rent it out and break even or make a small amount with a 15yr mortgage (I really am not sure if this was possible before anytime in the past 30 years, 3% is just so cheap)
i.e 250k house, 50k down....200k note at like $1400 then you pay the other stuff and break even or so....Over 15 years that 250k turns into 400k and note goes to 0. Thus 50k turns into 400k 700% return (like 13% a year maybe?)
Obviously other stuff to factor in like maintenance/repairs/vacancies so might be some out of pocket expenses along the way..
Tyler is the most negative person I have ever read.
I would be surprised if we did not have some type of DCB Monday.
Tyler is very consistent with doom and gloom predictions, gotta give him credits for that. The dude always find himself on the wrong side of liquidity fight with Bernanke though. Nevertheless, zerohedge has become a very popular financial blog, notice its adds...Aflac, TDAmeritrade, Schwab, ING...just name a few...those are well-know brand names...he must be doing something right....
