Just as an afterthought. What is the best way of buying calls, e.g., GS
when the premiums are sky high. I contemplated buying these but the premiums
were so high I got scared away. Unfortunately! Does anyone have
an opinion when premiums are too high to get involved?
I realize a lot of these decisions are personal but there must be a
way of "playing" this idea and mitigate the risk.
Thank you in advance,
JAC
In a message dated 9/18/2008 9:32:41 P.M. Eastern Daylight Time,
tpylypuk@xxxxxxxxcom writes:
Bob,
Although one day activity does not a
change in direction make, your comments regarding naked short selling
and total gloom and doom appear to have been predictive of today's price and
other action.
Tony
I admit that I have not seen anything quite like what is going on
before. I've been at this for about 37 years and I've seen a few
bear markets but never the destruction of one firm after another after
another. I am fairly well convinced that hedge funds are working
together and taking these financial firms apart. They know that if
they drop the share price significantly, the firm will be forced to raise
capital which they can only do to a point and then, it's end game.
Mean while, they have shorted the hell out of the stock and walk off with
a big bonus while the share holders, employees and associated businesses
are left with nothing.
I think that enforcing the naked short rule will help this situation
and it may help it a lot. We should put the uptick rule back in
place too. Speaking of hedge funds, it's way past time they were
caused to be transparent. If not for the good of those who have
invested in the funds, then for the good of the investment community as a
whole.
Last, as expected, we are now seeing forecasts of total gloom and
doom and today, gold rose $80 an oz and 2 month bills had a negative
return. If that isn't capitulation, there is no such thing.
The enforcement on naked shorting kicks in tomorrow ... capitulation was
today .. Thursday will be very interesting.
Bob
![]()