Previous observations indicate that the major banks’ balance sheet are full of liquidity. It is well known that the fed’s monetary action such as easing is as difficult as pushing a string, while tightening is easier as if pulling a string. The previous rounds of easing were no exception, and it probably resulted in moderate inflation. Think back to previous boom time, the fact that people felt wealthy encourages spending. Majority of People’s largest assets are their homes, or the stock options from back in the dotcom boom. The wealth effect phenomenon, albeit phantom some might consider, enhances people’s psyche and boost consumer confidence. When you are wealthy with good income prospect, you are more willing to spend, because chances are you will regain spent liquidity from a job income or asset sales. Many including myself suspect that in order to get out of this deep recession, corporate America and individuals alike may need to stop the de-leveraging, a result from the aftermath of the financial/subprime/credit crises, and begin to supplement their balance sheet with more debt, obviously in a responsible and sustainable manner unlike previously. If there was a way for the liquidity injection to find ways into the pocket of individuals, private businesses, and corporate America, the recovery process may enjoy a solid ground to stand on if there’s a will to spend these money. The fact that the Fed is paying interest on the big banks’ excess reserve is preventing this liquidity from reaching where it is needed the most. I assume that this helped contributed to the low inflation the Fed refers to. While it is debatable whether there is demand out there for such funds, it is absolutely crucial that the Fiscal side must do its job to stimulate such demand and establish a favorable and stable business environment.
記得上個月我們利用CMG財報之後的崩盤, 打底之後來獲利嗎? 對於十月份的選擇權策略來說, 雖然圖形上沒有上一次那麼漂亮, 但是我們仍然可以試著利用之前送給大家的高勝率選擇權策略來交易. 技術分析上來說, 大跌之後打底, 向上突破, 遇到主要阻力回檔, 現在接近50天均線, 並且慢慢進入超賣區, 我們有理由相信350 – 270是目前的交易區間, 今天如果你賣250 naked put, 大約可以有剩下三週約3%上下的回報, 以機率上來說有99%(99.14% 見下圖)的勝率, 當然如果你有讀我們的教學, 是不會等到最後才止損的, 所以勝率大約可以到90%上下(依照個人止損的範圍會有不同). 大家可以參考一下這個策略對於CMG的應用, 我個人是覺得蠻划算的.
今天是美股2012年Q3的最後一天交易日， 雖然是以跌盤作收， 不過因為中央銀行的一些利多政策， 整這第三季還是非常亮眼的。 就整個季度來說， 道瓊斯漲了超過4%， S&P跟納斯達克都雙雙漲了將近6%。 我會建議有投資美國股票的朋友在最近可以開始獲利了結，因為接下來的美國大選以及所謂的財政懸崖（見wiki: Fiscal Cliff) 都有可能為市場帶來許的的不確定性。 就短期的投資者來說的話， S&P500 拉回到1,420左右的支撐是比較有可能的， 不過我還是認為， 今年的市場還是有希望在年底前站上1,600大關的， 各位投資人不妨多多觀望， 在拉回後找到好的進場點.
Another result that the Fed hopes to achieve is driving investors away from the safety of treasuries, and into riskier assets such as high quality corporate bonds and equities. On the lending front, as the spread between fixed rate loans and floating rate loans narrows, the yield give up for owning floating rate securities is minimal. Many banks require an interest rate floor on (a long put option from the lender’s perspective) these floating rate commercial loans, as a result, in spite of the treasuries nominal rate might be lowered, the real rates paid on these commercial loans will not go much lower.
The QE3 has a similar effect by allowing the Fed to go into the secondary mortgage market and purchase Agency MBS, the higher demand increases the price of such securities, and thus help lowering the rate, plus the Fed had previously purchased some MBS, as those loans amortize and mature, I believe they will commit the principal and interest proceed to more MBS purchase. Translation: lowered mortgage rate and higher disposable incomes for borrowers. This has a similar effect as Twist 2, except, Twist 2 seems to lower rate on the front end, and QE3 does it through the back end, so to speak. It is, however, difficult to judge how effective this stimulus is, when there is an overall anemic demand for housing with multi years worth of shadow inventory that needs to work through the system. This nevertheless, is not what some people worry about, the fact that this Quantitative Easing is not sterilized would result in propping up asset price including Housing price, Business Values, Commodity Price, Food Price, Energy Price, and most recently readily observable, Equity Price, so on and so forth. There is a good chance the newly created currency may find its way into the circulation and causing inflation(or god forbid Stagflation) to spike.
The spiking of U.S. Dollar denominated asset prices is often accompanied by a drop in the U.S. dollar. Weaker dollar is beneficial to U.S. Export, and increasing export may attenuate the trade deficit, which supports GDP growth and shifts jobs here, unless the rest of the world does something to counteract the situation. More likely, in such weak world economy, Central banks of the Euros, Yen, Yuan, and other trading partners of the U.S. are gonna fight back, and this may cause a full fledged currency war, and who knows what that may lead to.