CoverIsBetter

10 Reasons to Believe That We're in a Depression

Sorry to stray off topic, but :
I would be interested to hear an analysis of the effect of monetary expansion on the economy at this point. At first, it seems the first country to expand its money wins. The debt drops relative to the bills printed. The trade imbalances shift in favor of the money-printer country.
Ultimately, the other countries join suite and correct the imbalance. So at a macro-scale you have this big debt dismissal in every direction that is mostly on paper anyway.
Then I wonder at a micro-scale what this means. For a capitalist who produces and borrows, it is a quick win. For an investor, it is a quick win in the stock markets. For a laborer, the picture is good long term, but last in line to benefit from a devalued currency. And the cost of food and fuels probably rises quicker than wages.
I just have to wonder, if there are two economies. The one where you earn money and use it to buy things. The other in which you are simply jockeying for debt forgiveness.

Thanks

Citigroup Makes a Good Move: Preparing to Buy Out Uncle Sam

Is this $5 billion for buying out the government, the same that will come from the bond auction mentioned here today : ftalphaville.ft.com/bl...

If so, this should not affect share dilution for the common stockholders, right?

10 Bullish Option Spread Strategies

Agree with naysayers here..
There is a reason these Bull Spreads are so cheap to get into, low chance these stocks move up that high that fast in the dog days of summer.
I have tried your strategy so many times only to see the stock trade sideways or down. As a matter of fact, I am holding your Bull Call Spread idea for USO from MAY 12 (seekingalpha.com/artic...)
and losing money on it.

Just saying.. this is a high risk strategy. My covered calls in WFC, BAC, and F are bringing me better sleep at night.

The Stress Test Cliff Notes

"Monte Carlo simulation that projected a distribution of losses by examining potential dispersion around central probabilities of default."

Sounds like B.S. Why can't you just count how many borrowers who are in current default. Then extrapolate that out into the future by demographic, style of home, price of home, salary, etc..

IMHO - Inflation is the only solution can get us out of this. To get real GDP growth up to a level to prop real estate back to 2005, is going to take immigration beyond imagination, since we aren't reproducing anymore (atleast not in my socio-economic group).
Net effect - the worlds resources and savings accounts are decimated in one quick rev of the printing press. O well.. I am in the prime of Gen-X earning power and lost most of my 401K. People will just have to deal. Put the printer on Nitrous and some parts overnighted from Japan and lets move on with production of coffee, software, and hamburgers :-)

An Options Trade on GM's Volatility

I guess in my above example, you would close it out yourself, but those Puts could still cost you something to get them back off the street, plus Commission, etc..

Thanks for the idea though.

An Options Trade on GM's Volatility

What if the perfect storm happens, and the stock goes to $4.00, you get Called on the Call leg, for a net loss of $1.00.

Then the stock falls to $1.00 and you get Put-To on the Put leg? Now you are about to go 100% loss on this trade idea.

I could be wrong, but unless you can force the whole clearing to happen at once, this could still lose a ton of your money. Please correct me, if I am missing something. Thanks

How Will Payday Lenders Be Affected by New Bill in Congress?

I agree with John In Madison. Payday lender is just one more leach attaching itself to a producer of income. To repeatedly visit these shops for your check-cashing, is tantamount to a huge pay cut.

That said, I have used one, but oddly, only once. So it must have been a one time situation where I needed help. Once.

Options Trader: Friday Outlook

Thanks for explaining the WMT trade. I got thrown by the word "expiration" and missed the opportunity to take out the Callers when those August contracts dipped. A few hours Thursday morning would have gotten me on board. I need to join your program, so I understand the recommendation from day to day. Keep up the helpful posts!

Options Trader: Friday Outlook

It is Expiration hour this moment : "sell the Aug $57.50s for $1 or more"

With WalMart trading up near $60, selling this contract has not worked well. Unless your advice was to let it expire? I am totally confused about how this trade was supposed to work.

Options Trader: Friday Outlook

I am not sure I understand why go all the way out to March for the WMT calendar spread? Could you not make more selling a more near term leg of the trade?