3 replies to this topic

[arbman]

I think the range bound and heavy short interest has to do with the enormous amount of money chasing private equity and hedging in the public stocks that are growing much slower, what do you guys think?!? The large traders are short on almost all of the indices. The large and small specs are short the 30 yr bond (much prior to the decline against the commercials), who is the dumb money now? They are long (just a bit) the crude oil, the commercials are short the crude against the large specs. So, it will be interesting, these large specs are predicting an inflation and lower stock prices at the same time, confusing huh?...

Edited by kisacik, 11 July 2007 - 02:00 PM.

[ogm]

Remember the days when enormous amount of money was chasing homes for sale ? And then insiders started selling stocks in homebuilders, and everyone was saying nah, they aren't making any more land, and baby boomers need at least 3 homes each. But the homebuilding stocks started declining all over suddenly. Scroll forward to today..... Enormous amount of money chasing the next hot buyout target. Everyone knows about LBO's and private equity and how well they are doing. But all over suddenly insiders are selling heavily. Multiple Private Equity firms IPOs, Brokerage stocks falling non stop ( The guys who make the money on advisory fees). But people are still talking about the next buyout target....... After all there is endless liquidity in the world ( read they aren't making any more land )

Edited by ogm, 11 July 2007 - 02:13 PM.

[pdx5]

Not to be overlooked is the recent sale by private equity by going public. (Blackrock?) IOW they cashed out, took their money and ran!!

Edited by pdx5, 11 July 2007 - 05:34 PM.

[arbman]

ogm, these guys who are doing the private equity stuff must be short the markets to hedge their investments, I can not see any other way. So, I don't think they would be loosing any money, if the liquidity crunch turns into a recession. What I am trying to say is; from the large specs to the small specs, everyone is extremely cautious about a credit failure or liquidity crunch type of events. There have been a lot of lessons learned from the past, imho. I do not mean to say a failure can not happen, I am trying to say a melt down is kind of unlikely because the risk is so spread all over the place. It will have to be a tremendous failure to take everything down, that's all... That's all?!?