Forex Novice

When Will Fundamentals Trump Trading?

I agree. Fundamentals can't be denied.

Time for the Euro to Gain on the Pound?

This 1.63/6350 for gbpusd is indeed conservative. Now the gbpusd is at the 1.6240. I expect it to reach the support of 1.6140 on support today or early next week.
Interestingly the eurgbp surged past the 0.9000 with ease. Here's to the approaching parity of the eurgbp like how the eurusd reached parity and never looked back. The eurusd is around 1.4700 now.

The Danger of Cheap Dollars

Thanks for the insight... I think the unwinding of the dollar carry trade causing dollar snap back resulting in buying of dollars in a flight to safety depends on the current status of the dollar.

If by then it is no longer the world global reserve currency and it is being replaced by Gold or SDRs or if hyperinflation were to erode the value of the dollar, things might turn out differently. I won't speculate how but i'll just wait and see and adopt a flexible stance as the situation unfolds.

Still the caution about the dollar carry trade is valid, LTCM is a very good example for the case of looking at the big picture before technical details. This is a very meaningful insight.. Thanks again.

Fibonacci Stops Rally in China?

Are you implying that the US government is gaming the market according to the Fibonacci Levels and the Chinese Government is following suite? Why would the Chinese want to follow the USA? They are the lenders?

Anyway for the 3rd and 4th picture, the SPX is monthly and the SSEC is weekly from what I see from the chart.

In any case this is an interesting observation? If they repeat themselves often, it would be reported in the press soon and you're the first I know to have noted and publish it.

What's Going on in the Interest-Rate Swaps Market?

I am not familiar with the interest rate swap but I find it interesting so I am seeking answers. I hope that someone can answer them.
1st: What is the purpose of the investment banks decision to sell the cashflow(pay another party to substitute of GM, in this low interest rate environment, ) instead of tearing up the swap by termination payment now that GM is bankrupt? Is it to hedge themselves as Felix noted or for the cash outlay as noted by Heaven, Hell or Hoboken?
Now that GM is bankrupt, isn't the swap near worthless?
Assuming that mark to market value of the swap is low, it would be in the benefit of the banks to tear up the contract.
2nd: Heaven, Hell or Hoboken. What do you mean by 'the swaps would have to have been made by the banks as they are unable to net such contracts against monies owed to them under loans subject to the automatic stay of bankruptcy.'
I am confused. It seems that you are saying the banks which made the loans to GM and the the banks that swap interest rate with GM are the same banks.
Can someone please clarify my doubts for me? Thanks.

The Problems of Financial Illiteracy

I think that it is true that investment don't work for most people because of mismatched expectations and lack of persistence and perhaps lack of proper method of instruction. For most people, investment is a 'get rich quick' scheme. So they take on too much risk in the hopes are striking it big and most people don't know what they are doing when they invest.
It takes discipline and effort sustained through time for anyone to succeed. It is harder than it seems. So this is the real world not school and we pay for our mistakes in money.

Carlyle Group and Lane Challenge Terms of Lehman Bankruptcy

Carlyle Group challenges that the buyout offer is too low at $2.15billion. Yet they say the actual price is at $1.55billion. Are they valuing Berman at an even higher than $2.15 over and above the actual price at $1.55billion?