Discussion in 'Stocks & Derivatives' started by ozcopper, Feb 24, 2020.
I backed up the truck today hoping the world would realise this beer virus is nothing but a media sensation .... like climate change was last month, before it pissed down rain.
How many percent of funds is that?
Share market -big Manipulation and trading news...
I hope your right but I just don't see how stock market will continue to rise when Trump declared corona virus a national emergency.
To me looks like we're gonna close in the red
I always keep a good percentage of powder dry.
Dead cat bounce
It's the markets deleveraging and margins being called
Options and Puts are being settled
On selling days.... few are buying, so shares drops hard
On buying days... few are selling, so shares rise up hard
The biggest gains in markets has been the dips of a bear market before the recession.
Besides as US start forced lockdowns in New York, Chicago, LA, Boston, San Francisco, Dallas and Miami panic will begin
It's all over. They closed Disneyland.....
Boeing and Hilton fully draw out their credit facility
Investment firm Carlyle and Blackstone telling all the companies they own to fully draw down their credit facility
In layman's term, it is like a person taking out 100% of available Equity out of their mortgage line of credit and maxing out all their personal credit cards
Why would they draw down in a time like this? To cover costs?
I'd be interested in understanding that as well if someone can explain please.
if you owe 50k to the bank, its your problem
if you owe a bank 500B, the bank has a big problem, you have no problem
Fed to Inject $1.5 Trillion in Bid to Prevent ‘Unusual Disruptions’ in Markets
Hopping and praying-NO!...
ALL ORDINARIES (^AORD)
ASX - ASX Delayed price. Currency in AUD
U.S. Stock Futures
S&P -128.50 / -4.77%
Fair Value 2,695.61
Data as of 7:17pm ET
Nasdaq -359.75 / -4.54%
Fair Value 7,972.49
Data as of 7:15pm ET
Dow -1,041.00 / -4.53%
Not all banks will have funds to pay out fully... And conditions might change ie cancel the facility as it goes to their limit or they get get some more cheap feds money and fulfil their obligations.
ie banks might have 100 billion ready in funds.... but have 200 billion in agreements (getting fees)
But as the draw downs near 80 billion the banks likely will trigger a condition in fine print that stop all others, so the bank can re-evaluate.
Much like credit cards, doubt a single major issuer like Amex have funds in hand for all their cards to max out at the same time.
You might say money is cheaper now..... doesn't help if the banks cancels the facility, or the banks might rerate the borrowers credit worthiness and ask for higher interest or cancels the facility outright.
So they draw down in the fear of not being able to rely on the facility down the track?
I would presume so... especially since the stimulus or rate cut won't increase revenue.
In current economic environment the fed cuts and stimulus is akin to giving starving people rations to keep them alive (since there is zero demand).
In the GFC the fed cuts and stimulus was more like giving people cheap money to buy equipment to raise a crop so they eat and sell.
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