To me, investing is all about diversification and risk mitigation. make the high risk plays but secure your self with some sort of option strategy as insurance. know when to stop out; use taxation to your benefits (captial gains capital losses).
if you are going to go ahead and leverage your plays (ie borrow to play), make sure you have a exit strategy and keep an eye on your margin so you don't get margin calls (i've never gotten a margin call but i've been blue in the face from almost exausting it).
if you are making major liquidity stock plays, you can easily avoid a margin situation by buying in the money options. Theta is very low (if there is any; this is the extra premium you pay on options)
I personally only borrow for real tangible assets (real estate etc), not counting short selling of stocks. Again, if you are going to borrow for leverage, make sure it is secure and have an exist strategy.
That's just me though and i'm by no means a big fish lol.
Nrg2Nfinit
The analyst estimates game:
Lagrangian
great movie, karim. hope you're well...
planning to long kiwi yen pair (from dip), we're looking at 79.20 right now SPOT fair price.. target around 86-87 which were 2007 highs.
fundamentally the NZ govt has confirmed its strong stance in currency appreciation. While the JPY will meticulously work to devalue their currency and push the NIKKEI higher.
I am playing the GBP/JPY on shorter time frames; both pairs seem extremely correlated with the kiwi yen being the prettiest girl on the pageant.
Lagrangian
Massive correction on the metals markets...gold and silver are out...
billymadision
Yikes silver is almost half of it's previous peak. Might be a good time to buy it up, but I am sure there is more selling where that came from.
Lagrangian
BOJ Statements
IV. Summary of Discussions on Monetary Policy for the Immediate Future
Based on the above discussion on economic and price developments, as well as
"price stability," members shared the recognition that it was necessary at this time to take
additional steps to provide monetary accommodation decisively in order for Japan's
economy to overcome deflation as early as possible and return to a sustainable growth path
with price stability under the Bank's mission stipulated in the Bank of Japan Act. On this
basis, members discussed monetary policy for the immediate future in detail.
Regarding the guideline for money market operations for the intermeeting period
ahead, members agreed that it was appropriate to maintain the current guideline that the
Bank would encourage the uncollateralized overnight call rate to remain at around 0 to 0.1
percent.
With regard to the operation of the Asset Purchase Program (hereafter the
Program), members shared the recognition that, with a view to clearly presenting the Bank's
stance of pursuing aggressive monetary easing -- aiming to achieve the "price stability
target" -- it was desirable to introduce a method to continue purchasing a certain amount of
financial assets every month without setting any termination date.
On this basis, the chairman requested that the staff explain whether this
open-ended asset purchasing method was feasible, particularly in terms of the following
points: (1) the relationship between the amount of monthly purchases and the total size of
the Program; and (2) the room left for additional purchases of the respective financial assets
in view of the Bank's risk tolerance and the market size of these assets. The staff provided
the following explanation.
(1) As for the relationship between the amount of monthly purchases and the total size of
the Program, assuming, for example, that every month the Bank purchased 2 trillion yen
of JGBs with the same remaining maturities as those purchased recently, the amount
outstanding of JGBs purchased under the Program would reach 48 trillion yen after a
certain period of time and be maintained at that level. Likewise, the amount
outstanding of T-Bills would reach 30 trillion yen, assuming that the Bank purchased 10
trillion yen of them every month. As for CP and corporate bonds, assuming that the
Bank purchased 1 trillion yen of them every month, the amounts outstanding of these
assets would essentially be maintained. To sum up, assuming, for example, that the
Bank purchased 2 trillion yen of JGBs, 10 trillion yen of T-Bills, and 1 trillion yen of
CP and corporate bonds -- thus totaling 13 trillion yen -- the total size of the overall
Program would be maintained at a level that was about 10 trillion yen higher than at
present. It must be noted, however, that the level would fluctuate somewhat
depending on the remaining maturities of financial assets purchased.
(2) The Bank would be able to make these purchases given the stock and flow -- the
amount outstanding in the markets and the amount of issuance -- of each type of
financial asset. Moreover, the amount of risk incurred by an increase in the total size
of the Program could be absorbed by the Bank's capital.
In response to this explanation, members discussed the specifics of the open-ended
asset purchasing method. They concurred that, after completing the current purchasing
method at end-2013, it was appropriate from January 2014 to introduce a method to
continue purchasing a certain amount of financial assets every month without setting any
termination date. One of these members said that, while it was possible to propose the
immediate introduction of the new asset purchasing method at this meeting, the member
would prefer to give priority to delivering a clear message that represented the consensus of
the Bank's Policy Board. Members also shared the recognition that, in 2014, when the
year-on-year rate of change in the CPI was likely to increase to 1 percent, it was appropriate
-- from the viewpoint of steadily implementing monetary policy in a continuous manner
with the aim of achieving the 2 percent "target" -- to purchase financial assets totaling about
13 trillion yen per month for some time, in order to increase the total size of the Program by
about 10 trillion yen and maintain it at that level. This 13 trillion yen corresponded to
purchases of 2 trillion yen of JGBs, 10 trillion yen of T-Bills, and 1 trillion yen of CP and
corporate bonds. A few members noted that, as it was likely to take considerable time
before the "price stability target" was achieved, and given, for example, that economic and
price developments as well as the effects of cumulative monetary easing were likely to
become increasingly uncertain with the passage of time, purchasing a certain amount of
financial assets every month for some time without setting any termination date would
clearly represent the Bank's monetary easing stance. A few members pointed out that an
increase in purchases of T-Bills was also important from the viewpoint of exerting influence
on the foreign exchange market through a decline in yields in the short term. Meanwhile,
a few members said that one option, for example, was to extend the remaining maturity of
JGBs to be purchased under the Program up to around five years.
As for the term to pursue aggressive monetary easing through the continuation of
purchases of financial assets and a virtually zero interest rate policy, many members
expressed the view that it was appropriate for the Bank to continue with each respective
policy measure as long as it judged appropriate, with the aim of achieving the "price
stability target" at the earliest possible time. In response, a few members said that, at
present, they were against setting the "price stability target" at 2 percent in terms of the
year-on-year rate of change in the CPI, and thus were also against linking to the target a
period during which purchases of financial assets and the virtually zero interest rate policy
would be continued. These members expressed the view that it was appropriate at present
to pursue a year-on-year rate of increase in the CPI of 1 percent for the time being, and that
in doing so, it was desirable to clearly present that the Bank had no policy intention to
prematurely withdraw the monetary easing measures before the rate of increase reached 1
percent. One member -- while noting that one possibility would be to extend the Bank's
projection period by one year, and continue with the virtually zero interest rate policy and
the open-ended asset purchasing method until the median of the Policy Board members' CPI
forecasts for the extended projection period exceeded 1.5 percent -- said that, at this
meeting, the member would follow the majority view of the Policy Board. A different
member was of the view that the virtually zero interest rate policy was an orthodox measure
to strengthen monetary easing by influencing market expectations on future short-term
interest rates, and that the degree of experience gained from this policy in terms of its
effects, including side effects, had differed from that gleaned from purchases of financial
assets. The member continued that it therefore was appropriate to continue with the
virtually zero interest rate policy, thereby demonstrating the Bank's firmer determination,
until the Bank judged that 2 percent in terms of the year-on-year rate of increase in the CPI
was in sight. In response, one member expressed the view that emphasizing the difference
between the effects, including side effects, of the virtually zero interest rate policy and
purchases of financial assets might entail a risk of reducing the policy duration effects,
which were strong at present. A different member said that the guidance for the future
conduct of monetary policy should fully take into account the high uncertainties regarding
(1) future economic and price developments, as well as (2) the effects of cumulative
monetary easing. Members, noting that the Bank of Japan Act stipulated the principle that
monetary policy should be aimed at "achieving price stability, thereby contributing to the
sound development of the national economy," shared the recognition that therefore --
regardless of how the Bank might present its future monetary policy stance -- it was
necessary under this principle to ascertain whether there was any significant risk to the
sustainability of economic growth, including from the accumulation of financial imbalances,
taking into consideration that it took considerable time before the effects of monetary policy
permeated the economy.
Regarding the policy coordination between the government and the Bank for the
purpose of overcoming deflation and achieving sustainable economic growth, the chairman
proposed the following.
(1) The Bank had been pursuing powerful monetary easing, and in order for this easing to
lead to overcoming deflation early and achieving sustainable economic growth with
price stability, it was important that firms and households make use of the
accommodative financial conditions in a more vigorous manner and produce positive
efforts, thereby encouraging further permeation of monetary easing effects through
economic activity. If such a situation materialized, the effects of monetary easing
would be maximized. Therefore, the role of the government was important in creating
a more favorable environment to this end. On this point, the new administration
indicated its stance to formulate measures for strengthening the competitiveness and
growth potential of Japan's economy and to promote them strongly, and the Bank
expected that the government would surely implement such measures.
(2) Under the "price stability target," which was to be introduced, the Bank would pursue
monetary easing and aim to achieve this target at the earliest possible time. The Bank,
under its virtually zero interest rate policy, had been conducting large-scale purchases
of government securities in order to further pursue monetary easing, and the amount of
such purchases would be increased further. It was becoming increasingly important to
ensure that the public did not perceive such purchases of government securities as
having been conducted for the purpose of monetization.
(3) Taking into account this situation, although the government and the Bank had always
maintained a close dialogue, for the Bank to fulfill its mission, namely, "achieving price
stability, thereby contributing to the sound development of the national economy," it
was important at this time to clearly acknowledge each other's roles and strengthen their
policy coordination, and to indicate this intention to the public in the form of a joint
statement. By doing so, it would be possible to further enhance policy effects. It
appeared that the Bank shared with the government recognition of the importance of
strengthening their policy coordination while the Bank conducted monetary policy
based on its own judgment and responsibility.
(4) As for the specifics of the joint statement, the Bank's staff had made a draft with the
government, on which basis discussion would be requested.
In response to the proposal, members discussed the release of the "Joint Statement
of the Government and the Bank of Japan on Overcoming Deflation and Achieving
Sustainable Economic Growth." They concurred that it was significant that the
government and the Bank would strengthen their coordination in order to overcome
deflation and achieve sustainable economic growth. Most members pointed to the fact that
Japan's economy had recently shown signs of a pick-up and was in an important phase of
returning to a moderate recovery path, and that the government had announced that it would
formulate measures for strengthening the growth potential of Japan's economy and promote
them strongly. These members expressed the opinion that, taking account of such factors,
it was extremely important that the government and the Bank -- in supporting Japan's
economic recovery -- clearly indicate to the public their stance at this time that they would
strengthen their coordination and work together. One of these members expressed the
view that, in deciding on the joint statement, it was essential to ensure the proper balance
between the Bank's independent role and the importance of exchanging views with the
government -- both of which were stipulated in the Bank of Japan Act. This member
continued that the joint statement under discussion at this meeting provided such a balance.
On this basis, this member acknowledged that the government respected the Bank's
independence, especially since in the joint statement (1) the wording "policy coordination"
was being used, and (2) it was stated that the Bank was responsible for the specifics of the
conduct of monetary policy. Some members said that it was also important that the
government firmly ensure the credibility of fiscal management in proceeding with
coordination. A few other members expressed the view that it was unsure whether the
government and the Bank sufficiently shared a common understanding regarding the
challenge Japan's economy faced, and therefore some more time should be devoted to
deliberating on the desirable policy coordination. One of these members said that it was
necessary to face the hard reality that, in order to achieve a steady inflation rate of 2 percent
in a situation where the labor force was declining by 0.6 percent on an annual basis, a
significant rise in productivity was required. Another member expressed the view that, if
it was not clearly stated in the joint statement that the government would share
responsibility with the Bank to achieve the 2 percent target in terms of the year-on-year rate
of change in the CPI, the effectiveness of exerting influence on firms' and households'
inflation expectations might be limited.
This person is on your Ignore List. To view this post click [here]
:D
Nrg2Nfinit
quote:
Originally posted by billymadision
Yikes silver is almost half of it's previous peak. Might be a good time to buy it up, but I am sure there is more selling where that came from.
selling? what selling
looks like the long specs are in control of this market. If you are using a selloff signal to initiate your buys.. I'd keep waiting.
heres a 2 year chart of silver.. looks liek a decent correlation to price the last few months
