Friday, September 02, 2011

Here It Is: Presenting Goldman's "The World Is Ending So Let's All Profit" Report

A few days ago the WSJ made waves by disclosing that Goldman was in the process of recreating another "Abacus", by pitching to clients a global "pain trade" presentation created by Goldman's Alan Brazil, which, among others, speculated that funding needs for European banks would be far, far greater than the IMF-proposed $200 billion, and would in fact be closer to $1 trillion. This emphasis is actually odd, because Goldman focuses as much if not more attention on the end of the Chinese bubble as it does on the end of the European ponzi. It of course also did the usual Goldman thing, which is to allow select clients to piggyback with its prop, pardon flow, desk, in recreating the same fiasco for which it already had to pay a half a billion settlement to the SEC last year. Yet to date, nobody had actually seen a public version of this report....That is, nobody, until now - presenting Goldman's top secret "State of the Markets - Long and Short Risk Strategies"
In summary, Goldman proposed key trades for Europe are:
  • Buy 5Y Protection on iTraxx Series 9 9-100% Tranche
  • Buy 6 Month EURCHF One-Touch Put Option
While on China Goldman recommends its best clients to the following:
  • Buy a Short Equity Total Return Swap on Chinese Banks
  • Buy a USD put CNY Call Option
  • Buy Short-Dated CNH Bonds (Dim Sum Bonds)
  • Buy AUDUSD Put Spreads or Receiver Swaptions on AUD Swap Rates
  • Buy Copper Put Option spread
Full report below:

GS_StateOf the Markets

No comments:

Lunch is for wimps

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.