Is Today Doomsday?

[William Kelly]

Is it too late to get a bet down? - BK

http://www.populistamerica.com/looming_september_or_how_the_market_speaks

Looming September: Or How the Market Speaks

September 18, 2007

by Robert W. Barker://http://www.populistamerica.com/loom...obert W. Barker://http://www.populistamerica.com/loom...obert W. Barker

postCount('Looming September Or How the Market Speaks');Comments (2) | postCountTB('Looming September Or How the Market Speaks'); Trackback Our American Stock markets speak, if one knows how to listen. The stock market tells us of coming events - we need to pay close attention when the market speaks.

Those of us that care about such things realized that someone in power somehow knew something about Sept 11, as put options were placed on the exact airline stocks that were most affected by the terrorist attacks - betting markets to drop in early September 2001.

Billions were made for parties that somehow must have known we were in for trouble - this was not the normal flow of options - this was a huge amount laid out that paid off in billions. Oh for the knowledge of events before they happen - we could all be rich!

The Option sales are being referred to by market investors as "bin Laden trades" due to the predictions that only a problem of the magnitude of 9-11-01 could force short-sell options like these upward. The market told the story in '01 but few knew or listened, and we were caught with our economic pants down.

The Security and Exchange commission never revealed who made these "lucky" trades and no one knows who made out on Sept 11, 01.

put option (securities trading) -- Britannica Online Encyclopedia

Now here in September of 2007 we have the exact same scenario unfolding, and September 21 or before is the target date of the next big fall. These people are gambling that the market will drop 30 to 50% off its current value, and have invested 4.5 billion that it will fail. That is a huge predicted drop, and can only be predicted by insider information on coming events, yet what do they know? These trades have a death day date on these contracts, it is September 217. Whatever is looming needs to occur between now and Sept 21, and if it does not happen these speculators lose billions.

$4.5 Billion in Options Call Markts Crash Before Sep 21, 2007

There are 65,000 put contracts at $750.00 for the SPX 700 calls for open interest. Standard and Poors index {SPX} deal primarily with derivatives or price of index and value at set target dates. These inside investors control 6.5 million shares at $750 = $4.5 Billion, this is not just a solitary trade, but quite a bit of money on a contract that is 700 points short of its current value. No serious investor would buy that deep "in the money" risks as too steep, so someone is wildly wagering on a mass dislocation.

A ton of strange options activity are ongoing in August and September, trades and investments that leave those of us that invest in the market very concerned.

There are many looming possibilities on the horizon for catastrophic market falls, each scenario I can envision is strong enough to fulfill these dooms day bets........... For more click on the link.......

[Guest Stephen Turner]

Bill, it was my understanding that the Put options placed before 911, paid off in the sums of a few million, certainly not Billions. Could any of this have anything to do with the collapse of the sub prime market, a biulding society in Britain has lost over 70% of its net worth by being caught up in this fiasco.

[Craig Lamson]

Bill, it was my understanding that the Put options placed before 911, paid off in the sums of a few million, certainly not Billions. Could any of this have anything to do with the collapse of the sub prime market, a biulding society in Britain has lost over 70% of its net worth by being caught up in this fiasco.

Here is an interesting take on all of this. Can't vouch for the accuracy of the article, way out of my area of expertise.

http://articles.moneycentral.msn.com/Inves...BearMarket.aspx

[Guest David Guyatt]

A very interesting article, Craig.

Quote:

“Rather than joining the crowd that blames the mess on American slobs who took on more mortgage debt than they could afford and have endangered the world by stiffing lenders, he points a finger at three parties: regulators who stood by as U.S. banks developed ingenious but dangerous ways of shifting trillions of dollars of credit risk off their balance sheets and into the hands of unsophisticated foreign investors; hedge and pension fund managers who gorged on high-yield debt instruments they didn't understand; and financial engineers who built towers of "securitized" debt with math models that were fundamentally flawed.”

AND

“Defaulting middle-class U.S. homeowners are blamed, but they are merely a pawn in the game," he says. "Those loans were invented so that hedge funds would have high-yield debt to buy."

Unquote

The level of global debt is such that it can never, ever be repaid. The financial markets are casino’s where the sun never goes down. Regulators have been a joke.

The warning signs of the madness of derivative trading were clear in the meltdown of Long Term Capital Management back in 1998. LTCM devised a strategy of leverage that was in excess of 500:1. In other words, for every dollar they had as a deposit or as an asset, they managed to leverage 500 times (I think it was 568 times – something like that anyway).

If Das is now advising hedge funds and others on the coming crunch, then you’ll see the rats making plans to leave the sinking ships in droves, converting their paper into gold or other enduring assets. And then heading for the hills. Because when this mountain of smoke and mirrors gets blown apart, it’s going to be ugly.

David

[William Kelly]

Bill, it was my understanding that the Put options placed before 911, paid off in the sums of a few million, certainly not Billions. Could any of this have anything to do with the collapse of the sub prime market, a biulding society in Britain has lost over 70% of its net worth by being caught up in this fiasco.

I don't know about the sub-prime mark, that seems to be a speed bump, but the catastrophie needed to kick in the Put Options apparently didn't happen.

Is it over yet?

Are we still here?

BK