I've always been drawn to swap spreads as a leading indicator of other things (e.g., credit spreads, generic financial conditions, fear, health of the economy), so when I put together this chart I told myself to not get too excited, because it suggests that the big selloff in equity markets was just a temporary thing that will soon be almost entirely reversed. Wouldn't that be exciting?
Tuesday, October 21, 2008
Are swaps forecasting a huge equity rally?
I've always been drawn to swap spreads as a leading indicator of other things (e.g., credit spreads, generic financial conditions, fear, health of the economy), so when I put together this chart I told myself to not get too excited, because it suggests that the big selloff in equity markets was just a temporary thing that will soon be almost entirely reversed. Wouldn't that be exciting?
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Lunch is for wimps
It's not a question of enough, pal. It's a zero sum game, somebody wins, somebody loses. Money itself isn't lost or made, it's simply transferred from one perception to another.
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