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    (Original post by Lyam)
    I agree. Once you've identified that something is definitely undervalued, you can be way more confident that it's going to spike up in value than if you think you've discovered a bubble. After all, with things like the 'dot-com' bubble, you never even know when it's going to burst, so it's pretty difficult to short it successfully (having the right idea is half of the task, having the right timing is the other half). On the other hand, if you know that something is going to rise in price, you just buy shares, sit on the dividends and wait for growth.

    However, I still don't think it's a 50/50 split. I think the very best traders and managers will be aware of this, but many traders will not. If you're not good enough to spot when something is undervalued, it's a hell of a lot easier to make money by jumping on the bull.

    And yeah, as much as people keep saying that debt isn't a problem (after all, we can just balance up by issuing gilts), it really is. That's why we have such huge cuts now because, well, it's that, issuing more bonds or printing more money. Maybe a little bit of inflation wouldn't hurt, and it'd reduce the value of some of our debt, but making our currency weaker isn't a great idea either. Gilts are getting a bit silly too, since it's the government's way of solving immediate debt issues while building slightly more debt. Cuts, as much as I hate them, are probably the best way to make the balance sheet add up.

    P.s. I appreciate your post, even if we differ on some points.
    Have you read 'The Greatest Trade Ever'? It's really good. I doubt anyone would be able to use the instruments John Paulson did ever again, but if you just search out those one way trades and bet the house then recessions are great business. Some people seem to be really quite offended at the idea of making money in downturns for some reason, when really the fact of the matter is you are just transfering wealth.

    I think we could also see some really awesome merger arbitrage or buyouts if everything tanks. Of course if you're just a small fry (like undoubtedly we are) all you can really do is follow the big swingers, which is risky, and most people would do better to just make a big fire and put their money on it. I just hope i've got enough money to exploit the situation when it does go properly tits up! It's going to be the sale of the century

    I appreciate your posts too, it's good to talk to someone on here who isn't part of the hang bankers brigade!
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    (Original post by oilfxpro)
    Only investors make money solely in bullish markets.Traders make money in any markets.
    I don't even know where to begin. Investors can make money in bearish markets as well. As you will see in my original post I said that Traders can make money in bearish markets as well or during a crash. However the majority make their money in stable markets. Did you know that most HFs can suffer a portfolio collapse if the price range jumps to over 3% due to their high leverage ratios? Infact, a 3% price change could cripple an entire HF!
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    (Original post by Elipsis)
    Have you read 'The Greatest Trade Ever'? It's really good. I doubt anyone would be able to use the instruments John Paulson did ever again, but if you just search out those one way trades and bet the house then recessions are great business. Some people seem to be really quite offended at the idea of making money in downturns for some reason, when really the fact of the matter is you are just transfering wealth.

    I think we could also see some really awesome merger arbitrage or buyouts if everything tanks. Of course if you're just a small fry (like undoubtedly we are) all you can really do is follow the big swingers, which is risky, and most people would do better to just make a big fire and put their money on it. I just hope i've got enough money to exploit the situation when it does go properly tits up! It's going to be the sale of the century

    I appreciate your posts too, it's good to talk to someone on here who isn't part of the hang bankers brigade!
    I have read it, it's fantastic! Yeah, I think people are clued up to it now. That said, they say that the problems of a previous generation reemerge when the last economist to be aware of those problems has died. If that's true then maybe such a situation would be possible in sixty or so years. Besides, while there may not be more Paulson-esque trades, there may be similar events in the future. Bubbles will continue to form, so you just have to try to spot them and hope you can short them (and short them properly (and at the right time)). You're definitely right about the merger-arb though, it could be interesting to watch, especially if some of them fall through.

    I'm definitely a small fry, though I might apply for some internships in my second year. I hear that they like OxBridge grads, so it's not completely unrealistic.

    Also, reading a book like that really lets you in on what some of these guys go through. I seem to remember (I read it a few weeks ago) that a few of them sold their CDS right before the crash. It was an utterly amazing strategy and an oversight on the part of those selling the CDS insurance which is just phenomenal. How, even when some of the subprime mortgages started to default, did they not cotton on? Moreover, why didn't the banks make more of an effort to sell the other side of the CDS contracts off? If they'd done that, losses would've been more spread out. Honestly, though, I think if I found something that was even slightly sketchy and that I could insure (without owning) for 1% of the value per annum, I'd probably go for it. The risks, compared to most trades, were infinitesimal.
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    http://www.youtube.com/watch?v=OcMeS...layer_embedded
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    (Original post by Lyam)
    I have read it, it's fantastic! Yeah, I think people are clued up to it now. That said, they say that the problems of a previous generation reemerge when the last economist to be aware of those problems has died. If that's true then maybe such a situation would be possible in sixty or so years. Besides, while there may not be more Paulson-esque trades, there may be similar events in the future. Bubbles will continue to form, so you just have to try to spot them and hope you can short them (and short them properly (and at the right time)). You're definitely right about the merger-arb though, it could be interesting to watch, especially if some of them fall through.

    I'm definitely a small fry, though I might apply for some internships in my second year. I hear that they like OxBridge grads, so it's not completely unrealistic.

    Also, reading a book like that really lets you in on what some of these guys go through. I seem to remember (I read it a few weeks ago) that a few of them sold their CDS right before the crash. It was an utterly amazing strategy and an oversight on the part of those selling the CDS insurance which is just phenomenal. How, even when some of the subprime mortgages started to default, did they not cotton on? Moreover, why didn't the banks make more of an effort to sell the other side of the CDS contracts off? If they'd done that, losses would've been more spread out. Honestly, though, I think if I found something that was even slightly sketchy and that I could insure (without owning) for 1% of the value per annum, I'd probably go for it. The risks, compared to most trades, were infinitesimal.
    What are you studying at Cambridge?

    I cannot believe what good value the CDS insurance was for Paulson. I don't think banks will ever be stupid enough to underwrite such a massive amount for a pittance again; Even my dad had been saying since 2005 there is going to be a crash in property soon. I mean for 1% down using leverage you could quite easily end up putting 0.1% down. That means your entire portfolio could be spread across 100-1000 different CDS options in any given year, and the odds of one of those coming up in any given year if you're spread across various industries are astronomically in our favor. Of course, not many people would take such a risk, and most would rather put 70% into bonds and then put the other 30% spread across 3 highly researched areas.

    Like you say we are doomed to repeat the past, but I don't think CDS is going to be an option. We'll be back to having to try and haphazardly guess when the best time to short would be, and end up like all those people around Paulson who did it too early! Plus, by the time the next generation of city workers comes in if we're any good we'll be retired. Maybe we could pull a Soros and come out of retirement to clean up!

    (Also, have you read 'More money than God'? It's a brilliant book. As is 'Fooled by Randomness', and 'The Art of Innovation', which is a book on being innovative in whatever line of business you decide to go into)
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    (Original post by Elipsis)
    What are you studying at Cambridge?

    I cannot believe what good value the CDS insurance was for Paulson. I don't think banks will ever be stupid enough to underwrite such a massive amount for a pittance again; Even my dad had been saying since 2005 there is going to be a crash in property soon. I mean for 1% down using leverage you could quite easily end up putting 0.1% down. That means your entire portfolio could be spread across 100-1000 different CDS options in any given year, and the odds of one of those coming up in any given year if you're spread across various industries are astronomically in our favor. Of course, not many people would take such a risk, and most would rather put 70% into bonds and then put the other 30% spread across 3 highly researched areas.

    Like you say we are doomed to repeat the past, but I don't think CDS is going to be an option. We'll be back to having to try and haphazardly guess when the best time to short would be, and end up like all those people around Paulson who did it too early! Plus, by the time the next generation of city workers comes in if we're any good we'll be retired. Maybe we could pull a Soros and come out of retirement to clean up!

    (Also, have you read 'More money than God'? It's a brilliant book. As is 'Fooled by Randomness', and 'The Art of Innovation', which is a book on being innovative in whatever line of business you decide to go into)
    I'm studying philosophy (which I know is hardly a banking-related subject, but apparently they're not too picky about subjects with OxBridge grads, which is nice). I haven't read those, but if I see them in town I'll pick them up.

    I'm surprised CDS was EVER an option, to be frank. It was too good to be true. Given the timing issues and whatnot, it made the odds of Paulson getting everything right about 50/50 (not literally) with a 100x payout? Imagine how you'd feel if you were one of his investors... :P
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    (Original post by R92)
    I don't even know where to begin. Investors can make money in bearish markets as well. As you will see in my original post I said that Traders can make money in bearish markets as well or during a crash. However the majority make their money in stable markets. Did you know that most HFs can suffer a portfolio collapse if the price range jumps to over 3% due to their high leverage ratios? Infact, a 3% price change could cripple an entire HF!

    The majority blow out in volatile markets cause they trade the unknown and uncertainty.1500 to 2000 hedge funds going bust over the last 4 years says it all.What money did investors make in those 2,000 hedge funds make in a crash , traders that ran off with investor's money?I am talking about those thieves under AUM at Giant Vampire Squid i.e the state pension schemes robbed in the U S A, run by the star of david .

    http://www.globalfire.tv/nj/03en/jews/sec_fed.htm

    Now where are all those super Goldman Traders with blown hedge funds run off to?nough for one night.
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    (Original post by Lyam)
    I'm studying philosophy (which I know is hardly a banking-related subject, but apparently they're not too picky about subjects with OxBridge grads, which is nice). I haven't read those, but if I see them in town I'll pick them up.

    I'm surprised CDS was EVER an option, to be frank. It was too good to be true. Given the timing issues and whatnot, it made the odds of Paulson getting everything right about 50/50 (not literally) with a 100x payout? Imagine how you'd feel if you were one of his investors... :P
    If you want to add even more to the stupidity, you've got to think that all those people and companies who were exposed to billions of dollars of property investment didn't bother spending the tiniest sum to make sure their asses were covered in the event of disaster. That's how **** sure they were. It's like the Titanic all over again.

    I'm sure there will always be a place on offer somewhere in the finance sector for an Oxbridge grad! Although I have heard that English students are having a really hard time of it, even the ones with firsts. I have some friends who work in the city, and it seems like far more fun to work in a hedge fund than it does working in the larger institutions. In the hedge funds you can feel like you're part of the team, and indispensible. In the banks you and your whole department could be fired at any time. Plus, the potential for wealth creation working for a fund, as well as creating your own fund, make it all the better. I hope you enjoy 100 hour weeks, and cocaine though

    (I'm a history grad by the way, so hardly business related either!)
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    (Original post by Lyam)
    I'm studying philosophy (which I know is hardly a banking-related subject, but apparently they're not too picky about subjects with OxBridge grads, which is nice). I haven't read those, but if I see them in town I'll pick them up.

    I'm surprised CDS was EVER an option, to be frank. It was too good to be true. Given the timing issues and whatnot, it made the odds of Paulson getting everything right about 50/50 (not literally) with a 100x payout? Imagine how you'd feel if you were one of his investors... :P
    Paulson never got anything right .tomhead or opposite.The schmock was sitting on Goldman's lap and spoonfed.All hiss investors were probably Goldman insiders.
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    (Original post by Elipsis)
    If you want to add even more to the stupidity, you've got to think that all those people and companies who were exposed to billions of dollars of property investment didn't bother spending the tiniest sum to make sure their asses were covered in the event of disaster. That's how **** sure they were. It's like the Titanic all over again.

    I'm sure there will always be a place on offer somewhere in the finance sector for an Oxbridge grad! Although I have heard that English students are having a really hard time of it, even the ones with firsts. I have some friends who work in the city, and it seems like far more fun to work in a hedge fund than it does working in the larger institutions. In the hedge funds you can feel like you're part of the team, and indispensible. In the banks you and your whole department could be fired at any time. Plus, the potential for wealth creation working for a fund, as well as creating your own fund, make it all the better. I hope you enjoy 100 hour weeks, and cocaine though

    (I'm a history grad by the way, so hardly business related either!)
    Yeah, exactly. I mean, Jeffrey Greene cottoned onto it, I suppose, but that's about it. I mean, even if they'd all bought the insurance and the price had gone up to, say, 4/5% per annum, Paulson's trade would still be strikingly obvious and brilliant, though the risks would be greater. Yeah, I figure Arts students will inevitably be second to, say, an economist, but everywhere I look people just say that there's no major difference with OxBridge graduates. Maybe that's because there's two things involved - some maths/theory (Which they're confident OxBridge grads can grasp, regardless of subject) and huge amounts of hours (which OxBridge grads have been doing for the past three years anyway). I'd say the latter is the most significant reason that they're less bothered about subject choice. The cocaine will be a new one though, OxBridge grads tend not to have as much experience in that area.


    (Original post by oilfxpro)
    Paulson never got anything right .tomhead or opposite.The schmock was sitting on Goldman's lap and spoonfed.All hiss investors were probably Goldman insiders.
    Erm... he certainly got something right because he turned a few hundred million $ into about $30 billion. Goldman insiders? If Goldman insiders knew that the housing market was going to crash, why would they pay Paulson 20%? Do you actually have any idea how Paulson made his money, or are you just here to Troll? Besides, that wouldn't even be inside trading as such, would it? Just speculation across banks...
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    (Original post by Lyam)


    Erm... he certainly got something right because he turned a few hundred million $ into about $30 billion. Goldman insiders? If Goldman insiders knew that the housing market was going to crash, why would they pay Paulson 20%? Do you actually have any idea how Paulson made his money, or are you just here to Troll? Besides, that wouldn't even be inside trading as such, would it? Just speculation across banks...


    If they traded themselves ,it would be insider and Goldman are known for it.So they picked an old chum and many more chums at AIG planted from vampire squid
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    (Original post by Lyam)
    Yeah, exactly. I mean, Jeffrey Greene cottoned onto it, I suppose, but that's about it. I mean, even if they'd all bought the insurance and the price had gone up to, say, 4/5% per annum, Paulson's trade would still be strikingly obvious and brilliant, though the risks would be greater. Yeah, I figure Arts students will inevitably be second to, say, an economist, but everywhere I look people just say that there's no major difference with OxBridge graduates. Maybe that's because there's two things involved - some maths/theory (Which they're confident OxBridge grads can grasp, regardless of subject) and huge amounts of hours (which OxBridge grads have been doing for the past three years anyway). I'd say the latter is the most significant reason that they're less bothered about subject choice. The cocaine will be a new one though, OxBridge grads tend not to have as much experience in that area.
    Yeah, it's pretty much a cert that you will land on your feet if you get a good classification (probably even if you don't). Don't any of your friends have dads who work in the city who can hook you up?

    A lot of people in the city who just run on fumes and don't touch the celebrity sherbet. I've never tried it myself, because I know I will just turn into an arrogant **** (even more so) and I will like it wayyyyy too much. I know a lot of people at Oxbridge who have done coke. A lot of the privately educated people I know first tried it while they were at boarding school. I even went on a nightout in my first year where a couple of Cambridge students came up to visit my friend, and they were going mad on ecstasy lol. Come to think of it the first pill I was ever given was from this guy who went to Shrewsbury who had just got back from 3 months in a rehab in America for a crack addiction!
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    (Original post by oilfxpro)
    If they traded themselves ,it would be insider and Goldman are known for it.So they picked an old chum and many more chums at AIG planted from vampire squid
    His investment didn't come from people inside Goldman though, so what possible motive would they have had to let the company that they work for almost go bankrupt - losing them their jobs, their homes, and a large chunk of their personal wealth? If you'd bothered to read any of the swathes of books written about Paulson you would know that it was primarily Pellegrini who came up with the tactic after many hundreds of hours of hard work. There are blow by blow accounts with timelines, and the buying was done over a considerable amount of time. It wasn't like someone at Goldman twigged, rang up Paulson and said 'buy this new financial instrument I just created for you that will make my bank implode' and within an hour he had exposure to that amount of CDS insurance...

    Bloody hell, get your tin foil hats out guys.
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    (Original post by Elipsis)
    Yeah, it's pretty much a cert that you will land on your feet if you get a good classification (probably even if you don't). Don't any of your friends have dads who work in the city who can hook you up?

    A lot of people in the city who just run on fumes and don't touch the celebrity sherbet. I've never tried it myself, because I know I will just turn into an arrogant **** (even more so) and I will like it wayyyyy too much. I know a lot of people at Oxbridge who have done coke. A lot of the privately educated people I know first tried it while they were at boarding school. I even went on a nightout in my first year where a couple of Cambridge students came up to visit my friend, and they were going mad on ecstasy lol. Come to think of it the first pill I was ever given was from this guy who went to Shrewsbury who had just got back from 3 months in a rehab in America for a crack addiction!
    Haha, that's crazy, I never knew Cam students were so... vibrant. I've never taken it... probably just because I wouldn't know where to get it. I don't really have an addictive personality, but I'd still be worried about touching the stuff. I think you still need to get a solid 2:1/1st from OxBridge to be in with a good shot. I'm not from that kind of Oxbridge background. I don't know, even by acquaintance, anyone in the financial sector and I live in the Midlands countryside, not much trading goes on here...

    Did you apply for any internships or anything?

    Bloody hell, get your tin foil hats out guys.

    I detect a troll.
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    (Original post by Elipsis)
    H
    Bloody hell, get your tin foil hats out guys.
    Exactly .empty cans make dour sound.hogwash.
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    (Original post by Lyam)

    Did you apply for any internships or anything?

    Bloody hell, get your tin foil hats out guys.

    I detect a troll.

    You detect somebody who knows thieves of Wall street /city Graduated crooks.


    The Big Lie Exposed: Wall Street as Institutionalized Fraud

    http://www.huffingtonpost.com/jeff-s..._b_154225.html


    Brilliant answer to banking crooks.Enjoy the Vampire squid stolen money from pension funds.

    Congressman Michael Capuano nails WallStreet Crooks

    http://www.youtube.com/watch?v=d6Im9W4gwNc
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    (Original post by oilfxpro)
    You detect somebody who knows thieves of Wall street /city Graduated crooks.


    The Big Lie Exposed: Wall Street as Institutionalized Fraud

    http://www.huffingtonpost.com/jeff-s..._b_154225.html


    Brilliant answer to banking crooks.Enjoy the Vampire squid stolen money from pension funds.

    Congressman Michael Capuano nails WallStreet Crooks

    http://www.youtube.com/watch?v=d6Im9W4gwNc
    Pension funds CHOOSE to invest to make a little extra money. What's your problem?
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    (Original post by oilfxpro)
    The majority blow out in volatile markets cause they trade the unknown and uncertainty.1500 to 2000 hedge funds going bust over the last 4 years says it all.What money did investors make in those 2,000 hedge funds make in a crash , traders that ran off with investor's money?I am talking about those thieves under AUM at Giant Vampire Squid i.e the state pension schemes robbed in the U S A, run by the star of david .

    http://www.globalfire.tv/nj/03en/jews/sec_fed.htm

    Now where are all those super Goldman Traders with blown hedge funds run off to?nough for one night.
    I really don't even know, what on earth are you talking about? Giant Vampire Squid? You have got to be taking the piss. Why is your name oilfxpro, when you evidently know nothing about trading?? You are making no sense, therefore it is almost impossible for me to respond to your questions.
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    (Original post by R92)
    I really don't even know, what on earth are you talking about? Giant Vampire Squid? You have got to be taking the piss. Why is your name oilfxpro, when you evidently know nothing about trading?? You are making no sense, therefore it is almost impossible for me to respond to your questions.
    You really wouldn't know what I am talking about because you know very little about real trading from the inside.Oil stands for crude oil futures , fx stands for currencies , pro stands for the master of the markets = oil fx pro.stocks , shares , futures , commodities , options ,trading systems ,financial trading etc is my field.

    How would you expect something you would not know about to make sense?How would you be able to respond to something you have little knowledge of?


    Which university is offering you your trading knowledge?
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    (Original post by Lyam)
    Pension funds CHOOSE to invest to make a little extra money. What's your problem?

    Some of the chums of the giant vampire squid are set up as fund managers , so of course they are going to invest in fraudelent cdos from their chums.A vampire squid shareholder Liddy was instilled at AIG and Hank paulson was a good chum.
 
 
 
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