The setup for the big trade

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Thu, Jul 18, 2019 - 8:23am
eclectic
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THE BIG SHORT

Guys, was wanting some help with understanding an important detail about this story. I don't recall an explanation in the movie; and the following is the only info Iv'e been able to find online. "When the bond values and CDOs rise despite defaults, Geller suspects the banks of committing fraud. The trio also visit the Forum, learning that the U.S. Securities and Exchange Commission has no regulations to monitor mortgage-backed security activity. They successfully make even more profit than other hedge funds by shorting the higher-rated AA mortgage securities, as they were considered highly stable and carried a much higher payout ratio." OK; here's the question. Why and how did the price of the shorted vehicles RISE in price in spite of defaults? From what I recall, they initially took a lot of heat (paper losses) when the market in these securities when against them; in spite of their being correct in their fundamental analysis that the value of these securities were worthless. It seems to me that they could have taken huge losses on their positions if the "price" had been kept up for a longer period of time. Hope the nature of my question can in some way be answered because this may have implications for some of us in the near future.
Thu, Jul 18, 2019 - 8:58am
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My assumption about that

... but I'm open to alternative ideas that may explain the events better.

There was an illiquid, but high volume market in mortgage backed paper.

The bank dealers were taking bank created retail debt paper and selling to/distributing it into pension funds mostly as a yield bearing asset.

The pricing mechanism was based on yield rather than risk.

So your question crystallizes into: how did yield become the dominant metric so that risk did not realign value if that yield, in other words, price?

My answer is : the rating agencies were complicit. Risk was understated and not highlighted in their reports upon those bonds.

So the paper was rated at a rating, AAA(?), that allowed pension funds to regard it as "a safe asset".

In other words, ratings agencies would be (1) avoiding hassle from regulators and (2) gaining related business of rating bond issues from the same bad banks.

The group reward system for insiders (banks-regulators-ratings agencies) constitutes racketeering in my internal understanding of the term.

I do not include Chinese ratings agencies formed afterwards nor Egan-Jones in my internal list of those agencies with questionable activities, as these ones suffering a penal regulator relationship during and following the GFC.

argentus maximus Rhythm and Price http://www.greenhobbymodel.com/rhythmnprice.html This analysis - global markets
Thu, Jul 18, 2019 - 9:11am eclectic
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THE BIG SHORT CONCEPT

David Hunter: I’m Calling for $1500+ Gold and $26 Silver

Will market historians look back and see the gold story as "THE BIG LONG"?

Thu, Jul 18, 2019 - 9:13am Green Lantern
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Green Lantern wrote:

Green Lantern wrote:

Sentiment.

And that is my take away from the totality of Am's posts. .... Sentiment!! Golden ratio, Fibonacci and the simulation. the collective sentiment in social affairs, political and money and gold!!

Exactly.

Green Lantern wrote:

https://www.tradingview.com/x/ruCiuysx/

Is that line at the bottom not making new highs while the line in the top is?

So we have doubts cast upon swing continuation, rather than clear information. Stops can cover such doubts.

argentus maximus Rhythm and Price http://www.greenhobbymodel.com/rhythmnprice.html This analysis - global markets
Thu, Jul 18, 2019 - 10:19am argentus maximus
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argentus maximus wrote:

argentus maximus wrote:

So we have doubts cast upon swing continuation, rather than clear information. Stops can cover such doubts.

Oh Yeah, and looks like a divergence is coming between those two asset classes? Transports, industrials look like they are topping.

Moved up my stops in gold and silver but silver came out of the blue. Of course it didn't, I just needed to look at things I wasn't looking at, and it wasn't doing anything but bouncing up and down around the point of control for weeks.

So I"m back to your gold chart as the map with the indicated overhead resistance, and the immediate cycle which is looking like high to high. So it looks what I said, they are testing the market.

But I have work to do. Tradingview sucks. It automatically saved that chart comparing dow to gold saving it over my other chart that all the long and short cycles and turning points. So I'm not posting USD/JPY chart.

Thu, Jul 18, 2019 - 11:26am argentus maximus
eclectic
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BIG SHORT BIG LONG CONCEPT

The main takeaway here I think is that is one's timing is "off" a lot of money can still be lost. As always, positioning and ideas like 'risk-free exposure' and average cost become paramount. Could someone post a price chart (or the best proxy thereof) during the time the big short positions were initiated?

Thu, Jul 18, 2019 - 1:37pm
Green Lantern
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Not sure which shorts you're

Not sure which shorts you're talking about, but I just realized after reading AM's solar minima post that on May 31st, the time gold popped, a new 17 month cycle began that involved the Roman God, Zeus and his buddy Cronos had a meeting. I don't mean to be cryptic by invoking the name of God's that alot of people haven't encountered since junior high school, but this is one of the most important cycles, represented symbolically, to understand regarding gold, and social trends, highs and lows. I wish it were easier.

And, I started to compare the inflections in that Solar Minima chart against gold.

It's easy to loose track of the fact that when AM posts about the weather, and the movies, he's talking about gold and hidden in his posts are the keys to timing.

So I get my 17 which I couldn't find on my little cycle chart and right back to an 11 cycle. 17 and 11ish are two very important harmonics in gold which are driven by the cosmic clock.

It is the nature of an alchemist to hide things in plain site.

If you don't read AM and acknowledge he is an alchemist and find your inner alchemist, it's harder.

I know, I know, and well aware this paradigm can fustrate people. I told Gann to go screw himself more than once with his hidden metaphors. Planes=Planets. But you're forced to learn the language. It's a slow painstaking process.

Said another way, referencing the cosmic clock and/or it's associated mathematical relationships, phi as a primary measurement, which is reflected in the sky as it is in the markets, is the way we don't get lost in the emotions of the collective.

In a sense, focusing on past relationships and analogies like hyperinflation occurred there, or trying to find analogies of macro conditions and ignoring the fundamental, the top of the hierarchy, drivers of mass sentiment, leaves us essentially in the position of guessing or watching others throw indicators on their charts never realizing something like volume or RSI are both related to this cosmic clock but their significance gets lost.

I know this doesn't answer your question and it kind of brings up those things that are slightly out of reach, but it's reality. We all found ourselves involved in something that was much bigger than we realized and then "Deus ex machina" out of nowhere this guy shows up throwing around strange concepts, and drawing strange pictures. Kind of like Plato pointing to the light coming in through a hole in the tunnel and your choice is keep focused on the shadows on the wall or aim for the light.

I have three books on Machiavelli, and two on Greek Rhetorical principles so I can understand what our President is doing. Putting all the puzzles together is not kiddie stuff.

So yes, timing is everything. Going in strong at the wrong time is a real bummer. I have no opinion on price averaging down because i'm endeavoring not to have to do that kind of thing anymore.

If you took all AM's posts from day one, in all the forums, put them together in one volume, you'd have a very very substantial book on a wide range of disciplines, thinking, cosmology, collective psychology, geometry and the mathematics of Phi and Pi that would probably be ten separate volumes of others people's work.

Thu, Jul 18, 2019 - 1:52pm argentus maximus
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Time and Tide (wait for no one?)

Close, but every year divisible by 4 has a leap day unless it is divisible by 100 when is doesn't unless it is divisible by 400 when it does. Since the Earth's rotation is slowing leap seconds are added to UTC from time to time, so to speak, so the the Sun's position at noon does not wander.

BTW: In my location consecutive high high tides come about every 24.5 hours making it difficult for me to understand the 13 hour day.

“Don't walk behind me; I may not lead. Don't walk in front of me; I may not follow. Just walk beside me and be my friend.” ― Albert Camus
Thu, Jul 18, 2019 - 2:51pm SteveW
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Point of possible

Point of possible misunderstanding noted and here's a precise clarification:

Basically we add an hour per day, (30 mins a tide twice in 24h) and thus know when high tide is without looking it up, writing it down, conferring with the web or refer to digital navigation maps, and also we don't go sailing while we sleep.

13 hour day = 25 hour day tide-wise in other words gets the daylight tide, the night tide can be used by other time zone residents a long way away!

I try to be as clear as possible but it's challenging to talk at several levels at once and get it totally clear and still be tough for ai information scrapers that are quantifying all of my and your sentiment and vulnerabilities for their owners.

So too clear is bad. eg You need adequate vision to see and find your food, but what about the other things for which YOU are the food? Some fog is beneficial. This is as good as it gets from me - and also why I used to put the esoteric discussion in a different thread (DOTS..., then IWWI, then ATGC).

Having it together doesn't work well enough. Clutter obstructs uptake. Back we go to that arrangement.

I'll reactivate the AM Blog articles for occasional articles as backup to Setup - after I clear a backlog of other behind-the-scenery work I must do first. Say a fortnight or three wks.

argentus maximus Rhythm and Price http://www.greenhobbymodel.com/rhythmnprice.html This analysis - global markets
Thu, Jul 18, 2019 - 4:27pm
SteveW
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Thanks AM

"So too clear is bad. eg You need adequate vision to see and find your food, but what about the other things for which YOU are the food? Some fog is beneficial."

Now it sounds like you're relating to my comment about evolution clouding our perception of the true reality. The AI scrapers will no doubt get it with a sufficient dataset.

“Don't walk behind me; I may not lead. Don't walk in front of me; I may not follow. Just walk beside me and be my friend.” ― Albert Camus
Thu, Jul 18, 2019 - 6:16pm
Solsson
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Gold and silver have really

Gold and silver have really flourished lately. I am often very hard on myself, but since mid May I must say ...

Well done Solsson!

Thu, Jul 18, 2019 - 7:19pm
Green Lantern
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$GLD cleared it's June 25th

$GLD cleared it's June 25th reversal.

There was a "smart" intra-day consolidation after that initial morning breakout... midday consolidation and lift off again at 2PM.

Scan intraday GLD over the month 2pm just when you're ready to take a nap after that big lunch is algo happy hour!

What's the best way to demonstrate inflation? Gold?

https://www.marketwatch.com/story/fed-chief-powell-says-he-thinks-core-i...

Friday expiration? Buy only if a new a high is made. Counter-intuitive

Right now narrative is they have cut rates. As soon as they flip.....that's when you have to becareful and ready to buy.

  1. Accumulation
  2. Run-Up
  3. Distribution
  4. Run-Down

stocks and tradeable assets don't move. they are moved. They create the simulation, you react to it unless you anticipate it.

Same in politics. All this happening while the PACK is surrounding the victim. Well, it looks like she dun screwed up. But it's not about who is right and wrong, it's about each side works the collective dynamic. The leaders are creating the circumstances and putting the crowd into a Roman Coliseum moment of ecstasy before the lions devour their victims. Use the crowd to obtain your goal. Trading and politics.

Accumulation, Leak out the news

Run-Up. Work the Audience.

Distribution-phase begins. catch the thieve

BLOOD FEST

I don't think I've seen anything like this that I can recall

Everything you needed to be successful at trading and analyze politics you learned watching Colombo Episodes. He always lead the killer to his own trap. Always one step ahead.

The Mirror Effect

https://voicesinthedark.world/disarm-and-infuriate-with-the-mirror-effec...

Thu, Jul 18, 2019 - 7:37pm
Green Lantern
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Watch Ray Dalio NOW carefully

Watch Ray Dalio NOW carefully. I think a guy like that knows how to create news a la Scott Adams. Creating the circumstances of your own success seems to be going viral.

Rick Rules Office called me today. Are you ready yet???

Big money knows how to work the little guy and time it right.

Fool me once....

Fri, Jul 19, 2019 - 7:58am
Green Lantern
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The next target is 1458 in an

The next target is 1458 in an elliott wave 5.

Since Friday, I can't watch trades all day, I will place limit stop but can use I phone. I am optimistic that GDXJ might have a chance at 40,and possible GDL can run to 140, a weekly high in GDX is close so if you're playing those leveraged funds, probably the same. . Alot of 4's showing up in the matrix. Somebody here pointed out it's relationship to the Islamic calendar this year. AEM, PVG, EGO all running

Silver exceeded all price targets but was over bought yesterday, given gold should have another 2-3 days of net Bull trend, silver should be net Bull for this time period for esoteric reasons.

The 2019 black out in New York City which was 42 years, 1/2 a twist of Uranus synodic cycle, mentioned last week.

This week it is followed up by a dangerous sweltering heat wave where temperatures will exceed 100 degrees. Not good. Same as 1977.https://allthatsinteresting.com/new-york-summer-1977-photo Yankees did indeed win the world series in 1977 against the Los Angeles Dodgers.

Who is in 1st place in 2019 in the American League East? The New York Yankees. Who is in 1st place in the National League West? The Los Angeles Dodgers. Cycles!!!! Any sports gamblers in the audience?

1977: STeve Jobs opens Apple Computer 2019 Apple laying people off, lowering supplies, quality going down.

According to the Guinness World Records, the largest lobster was caught off the coast of Nova Scotia, Canada in 1977 and weighed 44 pounds, 6 ounces. Well, we didn't beat the record, but we did make the news. 17 lb made the news.

You could do this all day but probably wouldn't hurt to look at the DOW/GOLD ratio in 1977

cycles, oscillators, elliot wave, fibonacci, fractal, Gann, Astro, Gudrieff s etc...... I learned it all here. Well based on the invitation to explore it. While I was trading, not very well, at the top of the gold market, I didn't have any of these skill sets, or a fraction of the understanding. I was told that I couldn't trade gold because it was manipulated and it was highly dangerous. All of this I learned as a result of the material that I learned from the setup. 100%. Sure, I had to buy the books, read and watch other people, but the impetus all came from HERE.

Why do I spend so much time doing all of this and posting. Well, I could say because in a bull trend, it allows me to make more money than working in an office building and in a dysfunctional corporate setting. It allows me to be my own boss. It allows me not have to do physical labor. But those aren't reasons. Those are benefits. The reason is because it's a form of self exploration, and intellectual stimulation and an opportunity for spiritual growth. The best traders I've encountered are all philosophers, and have explored many rabbit roles and they have made discoveries about the nature of reality that they wouldn't have otherwise. It's a calling.

So it's no longer about price-averaging, prepping, surviving political and social decline...that's past history. It's about thriving as a human being and being better. That has always been my drive even before I went to college.

I was meant to find AM. That's called destiny. I'm certain of it.

It is ALWAYS during these type of declines of social, financial realities that people start to wake up. Turning lead into gold. So what we are watching is NO accident and what I am experiencing since the beginning of the new 11 year cycle that happened last year is a fractal of what we are seeing in terms of a revival of information in the world.

At some point I will copy and paste all AM's contributions, put it into one document, and give it back to him and hopefully he charges $144.00 dollars for it. The price Merriman charges for his books. I started that process but funny thing happened. My Mac book was recalled because of manufacturer defects. DUH and I used every trick in the book, and still have a few left, to get them to fix EVERYTHING, but secretly, I got the guy at the apple store to admit, he has the same problems and it's not looking good for Apple. While I backed up ALL my books, materials and documents, I can't seem to get it off onto a microsoft. Mercury retrograde PROBLEMS. The guy next to me was a suit and tie reading Ray Dalio's "principles"

Fri, Jul 19, 2019 - 12:28pm
Green Lantern
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If you take just the solar

If you take just the solar cycles on AMs chart(keep it simple) and ignore the other weird stuff (you can add them in later) The 1974 low, 1987 crash and 2008 crash were all Solar lows, but the 2000 Bear was a Solar High. Right now we are at a Solar Low and the possibility of a Bear and/or Panic exists. You can do the same exercise in gold and you should, on that alone, you will have more information where we are in the gold cycle than the majority of technical analysts and Ivy League macro people. The sun is one of the best macro tools and takes you out of the minutiae of synthesizing tons of macro data and sorting out what is brainwashing and what isn’t by fed, prez and media

No freedom is possible, no authentic choice, where consciousness is lacking. Paradoxically, consciousness usually only comes from the experience of suffering and the flight from suffering is why we often elect to remain in the constrictive yet familiar old shoes.~James Hollis

Fri, Jul 19, 2019 - 1:29pm
zman
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Pure Scum

https://www.zerohedge.com/news/2019-07-19/ceo-worlds-largest-asset-manag...

The CEO of BlackRock who manages $6.5 trillion of assets. "if the ECB is really going to try to restimulate the economy in Europe, they're going to have to buy equities"

Wow, this Larry Fink can't think of any other fashion to help the European economy other than printing money and buying stocks!!!! The level of arrogance is stunning at this point. To go on CNBC and make these statements is just crazy.

Don't worry, it's coming to the US as well. The Fed will be buying trillions worth of corporate stocks and bonds in short order. Well, what about buying some of the debt off the peasants? Never going to happen.

Fri, Jul 19, 2019 - 7:13pm
Green Lantern
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GDXJ made 40. GLD couldn't

GDXJ made 40. GLD couldn't push it to 140. Then Rosengren said: I don't see the need to be accommodative. Gold broke , silver broke , spx broke, crude broke.

The news breaks with the cycles, not the other way around.

Fri, Jul 19, 2019 - 9:46pm
Green Lantern
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13 month cycle occurred on

13 month cycle occurred on June 10th.

https://www.usatoday.com/story/news/nation/2019/06/06/jupiter-opposition...

It worked this time, but haven't looked back.

Sat, Jul 20, 2019 - 8:00am Green Lantern
eclectic
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Green Lantern, etc....

I feel remiss for getting sidetracked and forgetting to read my e-mails on this forum. I apologize for not saying "thank you" and taking the time to respond to my oft silly questions: to Pete, Ivars and Just A Regular Guy. These e-mails go back for 5 years: embarrassing to say the least. Hope you have benefited from your trading and networking with others. If there were others I'm sorry for not acknowledging your replies. My best wishes to all of you.

e

Sat, Jul 20, 2019 - 9:41am Green Lantern
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Hey GL, thanks for the inspirations

I just retired and now look forward to being able to spend the time to go over AM's posts and learn all the lessons he intended his audience to struggle with and learn also. It's great to see how your journey evolved GL, and the many twists and turns it took you through. Your relating of your journey to an increase of consciousness is very apt, and ties in with a book I am reading right now, called "Awareness, The Perils and Opportunities of Reality" by Anthony de Mello. Best book I've read in years about becoming aware of reality, or as you say GL, conscious. Please let me know when you get all those posts to AM to sell as I would like to buy his book since I know I didn't know he was posting some of his material on some of the other forums, like DOTS, etc. so I am sure I missed a lot, which is some of the key material I need to learn what I'm missing. Anyway, thanks for the inspiraton to follow the bread crumbs that AM has put down.

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