WHODAT@THADOR
Well-Known Member
Just thought this was interesting
Million dollar traders
- Thread starter WHODAT@THADOR
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WHODAT@THADOR
Well-Known Member
IDK ...You can make pretty good money as a trader, as for contributing they contribute right around as much as being a banker.
Bankers actually make 90% of the money in the world, so that's a pretty big difference.
WHODAT@THADOR
Well-Known Member
Bankers dont trade on market's....Bank's train or find trader's ....It get's to be pretty boring after awhile
90% of the market was made by a banker.
WHODAT@THADOR
Well-Known Member
Whatcha mean?
abe supercro
Well-Known Member
I traded something once for a giant bag of dog food. Don't even remember what I traded, but the cheap dog food made my dog sick. Then I forgot about it somewhere and mice got into that shit and made a damn mess, but I still enjoy and believe in the barter system.
Because almost 90% of the entire market is nothing more than credit and debt. All debt is issued by banks, the first dollars are issued by the Fed and loaned to the government, government spends the money into the civilian population. Whenever someone deposits a dollar into a fed chartered bank, that bank then deposits that dollar with the fed to hold as a reserve. Because of fractional reserve banking, the bank is now able to loan out $9 for every one dollar deposited. So, now lets get to the futures markets, you seem like a smart guy and I will assume you understand that your trades are just credit and debt flying around and not actual physical goods. The underlying asset of some of your trades has been gold and silver, but can you actually get the actual physical item you are trading? No, absolutely not, you will have to redeem your digits on the screen into a deposit in an account somewhere and then trade those digits in the account for an actual physical piece of gold or silver from someone who is willing to accept your digits on a hard drive somewhere for his real gold and silver.
All those digits are just credit created by a bank somewhere.
Now think about if a bank all of a sudden had all of its loans paid off or somehow had its debts that it had created null and voided by some event?
Like for instance a bank which used all of its reserves to make a futures bet (Commercial bank here, not a hometown bank) and that bet was a long put on a stock that went to zero and the trading commission OK's the trade. That would be infinity dollars owed. Shit like that that all of a sudden causes an avalanche of credit nullification, causing banks to fail by the thousands.
Why?
As a smart person you know why, when dealing with exponentials the infinity quandary is all inclusive.
So that is why governments have rules about the infinity quandary and halt trades before they limit out and take the entire credit market with them.
Like a bear sterns/ Lehmans/ Fannie/Freddy/ debacle gone wrong. If government doesn't step in and shore up the banks with the people's money then the cascade of eliminated credit/debt will eventually take out the entire system and all the wealth that is in the form of paper dollars or digital representations on a hard drive will be rendered worthless. And by people's money I mean the government doesn't actually come and get the money from us, what they do is pass a law that says they can issue a bunch more treasuries into the market and the interest will be paid by taxes. The fed buys the treasuries and the debt is monetized and turned into money which is then spent. Unfortunately it was only spent to shore up the bad debt so doesn't really make it into the general population so the fed had to step in and do some crazy money spending in order to keep the system together with duct tape and bailing wire.
So in essence, the markets are really nothing more than debt that was created and is owed to a bank somewhere at some particular interest rate.
If banks disappeared all futures markets would have to be actual physical items shuffled back and forth. No more 100 to 1 ratios to the underlying asset anymore without a bank to create the credit to back the claim.
Apologies for the long winded response that probably went way too far to explain how the markets are really just bank credit to back the claims.
bud nugbong
Well-Known Member
It is kind of wild that its just paper. Not gold, or diamonds. just a representation of wealth. But you can use it to buy anything if you have enough of it. I was very skeptical of the whole system growing up, but now that ive seen the ups and downs im fairly sure it wont just vanish, or become worthless. At least I hope not
WHODAT@THADOR
Well-Known Member
While I will Concede to to much of what you say there in your Long winded response
...There are a few nick nacky things I disagree with or wonder what your opinion is? Absolutely I realize I cannot trade my cash for Physical Asset's in the future's market....But you can in the Cash market somehow IDK how but there is suppose to be a way, But in the end all the trading in the front running months on a contract is suppose to dictate is a future price in the Cash or Spot market and there are way more forces then a single institution driving that price IE As you have said there are more then just one Bank, As well as Hedgies,Brokerages,various smaller funds and the lone Retail investor; I also believe what was also left out is the debt issued by brokerages or Margin which I feel has a more detrimental effect to investor's unless Understood and Utilized in a responsible manner. Now, your pretty intelligent yourself and I am a student of infinity what sucks about infinity is it never end's neither does the work!!lol But, to me IMO I have learned to just shift my perspective with infinity,IE where the Fundamentalist's see's those negative event's as end of the world event's(Lehmans/Freddie), I see healthy price action. that moves to key ratio's to validate ...IE take 00 & 07 high's1552.87 & 1576.09......take the difference 23.22/the 00 high to get 66.8763 now divide 1 by it to get .01495295 multiply by 100 and get 2.236 ....Minding you that 1,10,100 represent unity Either way what plagues traders is how do I make consistent money with either way.... Fundamentally or Technically.....So, in my conclusion Yes I do agree that there is substantial Debt built into the market's, But I also believe that the view is to simplistic in nature and that the debt will not be it's downfall......Personally, I feel that when there IS the next financial crisis it will be caused by mis leveraged asset's in the ETF market's against various securities maybe?....Sound's like a good excuse as any right?lol
I think the next major financial crisis will come when China and Russia stop accepting US Dollars for goods and services, or when debt saturation is at a point that no one really takes out any loans. Once loans stop being taken out, money stops being created, once money stops, interest payments start eating the capital. Then you have major deflation, which is the enemy of all governments and central banks.While I will Concede to to much of what you say there in your Long winded response
1552.87 & 1576.09......take the difference 23.22/the 00 high to get 66.8763 now divide 1 by it to get .01495295 multiply by 100 and get 2.236 ....Minding you that 1,10,100 represent unity Either way what plagues traders is how do I make consistent money with either way.... Fundamentally or Technically.....So, in my conclusion Yes I do agree that there is substantial Debt built into the market's, But I also believe that the view is to simplistic in nature and that the debt will not be it's downfall......Personally, I feel that when there IS the next financial crisis it will be caused by mis leveraged asset's in the ETF market's against various securities maybe?....Sound's like a good excuse as any right?lol
Little people like you and me cannot get delivery, only large commercial entities with the proper vetting and with minimum amounts of purchase which are usually way more than us little people can ever afford to risk.
All that leverage you have in the futures markets is just banker credits/debt.
All fiat currencies fail at some point, there are none that have survived the test of time.It is kind of wild that its just paper. Not gold, or diamonds. just a representation of wealth. But you can use it to buy anything if you have enough of it. I was very skeptical of the whole system growing up, but now that ive seen the ups and downs im fairly sure it wont just vanish, or become worthless. At least I hope not
bud nugbong
Well-Known Member
Like I said, nothing im worried about... there will always be a way to buy and sell goods. Maybe the dollar will be replaced with the bitcoin long after im dead. But as long as i'm here, Im chasing the cheddar, and trying to put it to use. No need to hold it, But use it to invest in things that hold there value, or make you more money.
WHODAT@THADOR
Well-Known Member
WHODAT@THADOR
Well-Known Member
My bad^^ ....Maybe but an event like that w/ Russia or China would be a black swan event nothing you would depend upon I don't believe any economical ties with China are in immediate danger like that...If I was to consider the credit cycle as well I would view that as a distant problem Rates will probably consolidate in my opinion for awhile before they really start to spike up and along with that the labor market would have to slow and rates will have to eat away at the middle class who expose themselves to high debt in the expansion thus causing the deflation in good's as they cannot be bought by the public....And whatever else they throw in there too..
As far as leverage I don't use future's to hedge my cash market positions so I don't worry about it really .....IDK you had to be a big timer tho to get physical delivered never really looked into it
Hell, its so bad that even the major players in the world will have to wait up to 2 years to get their metal, most just cash settle. Which is the way they want it since digital dollars basically cost them nothing to send to you.
I think the minimum amount of silver for delivery used to be 5,000 ounces minimum if you were a vetted major player, but they have since added a smaller 1,000 ounce minimum. You have to have the accumulated certificates of exchange to use the min 1,000 ounce bar for delivery and the certificates are near impossible to get.
And of course the CME has given itself the authority to reneg on any contract for delivery at their convenience.
http://www.cmegroup.com/trading/metals/1000-oz-silver-futures.html
http://www.cmegroup.com/trading/metals/files/daily-settlement-procedure-silver-futures.pdf
http://www.cmegroup.com/rulebook/NYMEX/1a/112.pdf
Oh but shit! ISIS is bringing back gold and silver Dinars!
http://www.vocativ.com/world/isis-2/isis-currency/
You just know ISIS is bad news when they start building schools and amusement parks, Hard core terrorism!!
