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Danger I-liquidity Against World Stock Market Part 2. I-liquidity stock indexes also visited China. China stock index showed symptoms similar to the S & P contract in 1986. particularly in terms of size or volume of liquidity. Even China is far worse condition. To protect its citizens from the negative effects of the margin, the regulatory body set a very high limit so that many traders are not able to participate. And this i-liquidity effect. Before I review further, I realize that some of you are confused with the correlation between volume and liquidity.
To get an average of accurate statistics and discovery (the formation of) the real price, is needed broad participation of various types of traders with diverse motivations as well. Imagine if the two hedge fund trading billions of dollar from each other only for a stock. The volume of stock transactions is huge, but there is no liquidity. The situation is very different if there are billions of traders who trade in two shares with each other. Liquidity would be very large.
Now imagine how the transaction frequency traders (high frequency traders) received billions of dollars in profits, almost without risk, from all of us. They are the ones who contribute the volume reached 60% in the U.S. stock market. But the action they make drastically reduced liquidity. Other traders away from the market as more and understand how unfair practice of high frequency trades and liquidity eventually declined sharply. I've also watched my trading volume was reduced by almost 75% since late 2008. Do what Sun Tzu said, "Avoid the fight you can not win". The market has its own structure. When the mass of a large amount of shares traded in relatively small quantities, maintained in a healthy market structure.
The liquidity provider in a smaller time frame enough profit. When the big players traded shares between each other in large numbers, they want to draw attention to the equity markets. Market structure becomes damaged because it does not reflect the activity of discovery / formation of the actual price. It is worth noting that this practice is illegal. This activity can be called "Painting the Tape ', but only a few people are concerned with the legal aspects of the financial markets arena lately. No one went to jail again unless fraudulent traders who do include high profile on Wall Street and around the world. I'm going back to it later, as this is the main cause of the lack of liquidity in the market.
Below is a graph of the FTSE index of leading shares in 1997. Its existence is just one of the many world stock that has the same behavior.
The U.S. government accuses S & P as be Scrape Crisis 2008
Rating agency Standard & Poor's announced readiness to face lawsuit the United States. Agencies most influential agency in the world accused of providing inaccurate in rating debt instruments based on residential pre-2008 financial crisis. In a statement, Standard & Poor's said it had received information from the Justice department the government lawsuit related to the relevance ranking of mortgage assets 6 years ago. The rating agency is calling the government's attitude is unreasonable and without factual evidence. Standard & Poor's ratings are even claims administration played no role in U.S. housing market collapse and the surrounding investment assets. The data they use even the same as what is owned by the U.S. government, and unfortunately the Washington did not do a thorough anticipation of the worst.
News of the lawsuit was first published by the Wall Street Journal, though not shared by the Justice Department to date Stocks Mcgraw-Hill, the parent of Standard & Poor's business, fell after news of the lawsuit until the emergence of as much as 13.8%. While shares of other rating agencies, Moody's, dragged down by 10.7%. As for similar institutions, Fitch Ratings, the government will not consider claims extend to similar institutions that allegedly slow to alert investors about the ugliness of debt-based housing 5-6 years ago.
Many analysts rating agencies as the culprit that worsen the current crisis of public confidence. Wall Street and investors depend on an assessment of the major three rating agencies to determine the debtor's ability to pay its debt load. Level AAA reflects the highest level of trust that is owned by a sector or a country off debt instruments. At the beginning of the 2008 crisis, many housing-based debt instruments are rated AAA are actually not reflect the real situation in the housing market. Parties aggrieved agency accused the agency had received bribes from big banks to give good ratings, so the bank can continue to sell investment assets based on housing to its customers.
"The rating agency has mortgaged analysis, independence and reputation for the sake of money," the cynical remarks of Senator Carl Levin at a hearing in 2010. Parties in the American Senate report mentions that the rating agency has lowered the standard of research for business purposes only. Until this news was written there has been no official information about the legal process of the United States Justice Department.
Nikkei Ends pathetic, Session II Bleak
Nikkei - Japan ended with a closed fell sharply on Tuesday (5/2) after rallying for five days in a row due continue back airings of political uncertainty in Spain and Italy. Ending the regular session, the main Nikkei index closed down -1.9% pathetic with or -213.43 at 11046.92 levels, while Nikkei futures also dropped to -205 points to 11,060. Technically, after the Nikkei suffered a sharp correction, some indicators have now turned bearish.
Noted indicator Stochastic, MACD and the Moving Average duration of 1 hour now been maneuvered downtrend. And the attitude of investors selling Nikkei expected to continue to pressure corrected to support 11,040 to 10,980 which is 38.2% retrace of Fibonacci analysis. While strengthening the apparent tough today, at least will likely shoot up to 11 200 11 145 resistance area.
Most regional markets fell after yesterday (04/01) DJIA posted losses more than tripled this year.
- Nikkei -1.9%
- S & P / ASX -0.5%
- HSI -1.7%
- Kospi -0.8%
- Taiex -0.5%
- Sensex -0.3%
- Shanghai Composite +0.2%
- STI -0.9%
- NZX-50 -0.8%.
Meanwhile, it was reported that the forex markets the euro continued to weaken amid uncertainty over the political situation of Spain and Italy. EUR/USD at 1.34672 from 1.35140 on Monday night in New York, EUR/JPY at 124.52 from 124.85, and the USD/JPY is at 92.36 from 92.38. Index HSBC China Services Purchasing Managers rose to 54.0 in January compared with 51.7 in December. While HSBC Purchasing Managers Index rose to 52.5 Hong Kong in January from 51.7 in December. Australia recorded a trade deficit of A $ 427 million in December, compared with a deficit of A $ 2.79 billion in November, and a deficit of A $ 1.5 billion.
Australian Industry Group / Commonwealth Bank Australian Performance of Services Index stands at 45.3 in January, up 2.1 points from December. Australia's central bank today decided to hold interest rates remain at 3.00% at the first meeting of this year, according to market estimates. Taiwan's consumer price index rose 1.15% in January from a year ago, compared with a 1.60% rise in December and expectations of an increase of 1:36%.
The price of gold at $ 676.50/ons, up $2.10 from its closing level. March Nymex crude oil futures fell 7 cents to $96.10/barrel.
To get an average of accurate statistics and discovery (the formation of) the real price, is needed broad participation of various types of traders with diverse motivations as well. Imagine if the two hedge fund trading billions of dollar from each other only for a stock. The volume of stock transactions is huge, but there is no liquidity. The situation is very different if there are billions of traders who trade in two shares with each other. Liquidity would be very large.
Now imagine how the transaction frequency traders (high frequency traders) received billions of dollars in profits, almost without risk, from all of us. They are the ones who contribute the volume reached 60% in the U.S. stock market. But the action they make drastically reduced liquidity. Other traders away from the market as more and understand how unfair practice of high frequency trades and liquidity eventually declined sharply. I've also watched my trading volume was reduced by almost 75% since late 2008. Do what Sun Tzu said, "Avoid the fight you can not win". The market has its own structure. When the mass of a large amount of shares traded in relatively small quantities, maintained in a healthy market structure.
The liquidity provider in a smaller time frame enough profit. When the big players traded shares between each other in large numbers, they want to draw attention to the equity markets. Market structure becomes damaged because it does not reflect the activity of discovery / formation of the actual price. It is worth noting that this practice is illegal. This activity can be called "Painting the Tape ', but only a few people are concerned with the legal aspects of the financial markets arena lately. No one went to jail again unless fraudulent traders who do include high profile on Wall Street and around the world. I'm going back to it later, as this is the main cause of the lack of liquidity in the market.
Below is a graph of the FTSE index of leading shares in 1997. Its existence is just one of the many world stock that has the same behavior.
The U.S. government accuses S & P as be Scrape Crisis 2008
Rating agency Standard & Poor's announced readiness to face lawsuit the United States. Agencies most influential agency in the world accused of providing inaccurate in rating debt instruments based on residential pre-2008 financial crisis. In a statement, Standard & Poor's said it had received information from the Justice department the government lawsuit related to the relevance ranking of mortgage assets 6 years ago. The rating agency is calling the government's attitude is unreasonable and without factual evidence. Standard & Poor's ratings are even claims administration played no role in U.S. housing market collapse and the surrounding investment assets. The data they use even the same as what is owned by the U.S. government, and unfortunately the Washington did not do a thorough anticipation of the worst.
News of the lawsuit was first published by the Wall Street Journal, though not shared by the Justice Department to date Stocks Mcgraw-Hill, the parent of Standard & Poor's business, fell after news of the lawsuit until the emergence of as much as 13.8%. While shares of other rating agencies, Moody's, dragged down by 10.7%. As for similar institutions, Fitch Ratings, the government will not consider claims extend to similar institutions that allegedly slow to alert investors about the ugliness of debt-based housing 5-6 years ago.
Many analysts rating agencies as the culprit that worsen the current crisis of public confidence. Wall Street and investors depend on an assessment of the major three rating agencies to determine the debtor's ability to pay its debt load. Level AAA reflects the highest level of trust that is owned by a sector or a country off debt instruments. At the beginning of the 2008 crisis, many housing-based debt instruments are rated AAA are actually not reflect the real situation in the housing market. Parties aggrieved agency accused the agency had received bribes from big banks to give good ratings, so the bank can continue to sell investment assets based on housing to its customers.
"The rating agency has mortgaged analysis, independence and reputation for the sake of money," the cynical remarks of Senator Carl Levin at a hearing in 2010. Parties in the American Senate report mentions that the rating agency has lowered the standard of research for business purposes only. Until this news was written there has been no official information about the legal process of the United States Justice Department.
Nikkei Ends pathetic, Session II Bleak
Nikkei - Japan ended with a closed fell sharply on Tuesday (5/2) after rallying for five days in a row due continue back airings of political uncertainty in Spain and Italy. Ending the regular session, the main Nikkei index closed down -1.9% pathetic with or -213.43 at 11046.92 levels, while Nikkei futures also dropped to -205 points to 11,060. Technically, after the Nikkei suffered a sharp correction, some indicators have now turned bearish.
Noted indicator Stochastic, MACD and the Moving Average duration of 1 hour now been maneuvered downtrend. And the attitude of investors selling Nikkei expected to continue to pressure corrected to support 11,040 to 10,980 which is 38.2% retrace of Fibonacci analysis. While strengthening the apparent tough today, at least will likely shoot up to 11 200 11 145 resistance area.
Most regional markets fell after yesterday (04/01) DJIA posted losses more than tripled this year.
- Nikkei -1.9%
- S & P / ASX -0.5%
- HSI -1.7%
- Kospi -0.8%
- Taiex -0.5%
- Sensex -0.3%
- Shanghai Composite +0.2%
- STI -0.9%
- NZX-50 -0.8%.
Meanwhile, it was reported that the forex markets the euro continued to weaken amid uncertainty over the political situation of Spain and Italy. EUR/USD at 1.34672 from 1.35140 on Monday night in New York, EUR/JPY at 124.52 from 124.85, and the USD/JPY is at 92.36 from 92.38. Index HSBC China Services Purchasing Managers rose to 54.0 in January compared with 51.7 in December. While HSBC Purchasing Managers Index rose to 52.5 Hong Kong in January from 51.7 in December. Australia recorded a trade deficit of A $ 427 million in December, compared with a deficit of A $ 2.79 billion in November, and a deficit of A $ 1.5 billion.
Australian Industry Group / Commonwealth Bank Australian Performance of Services Index stands at 45.3 in January, up 2.1 points from December. Australia's central bank today decided to hold interest rates remain at 3.00% at the first meeting of this year, according to market estimates. Taiwan's consumer price index rose 1.15% in January from a year ago, compared with a 1.60% rise in December and expectations of an increase of 1:36%.
The price of gold at $ 676.50/ons, up $2.10 from its closing level. March Nymex crude oil futures fell 7 cents to $96.10/barrel.
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