Methinkshe Posted February 17, 2009 Share Posted February 17, 2009 RED ALERT: FX Dislocation In Process Quote Link to comment Share on other sites More sharing options...
50%deposit Posted February 17, 2009 Share Posted February 17, 2009 I do not know what is going on here, and I don't think I want to.Someone, apparently someone in Asia, wants dollars. A LOT of dollars. There is a forced-liquidation event underway that is massive, it is against all asset classes and it is spreading. It originated at approximately 7:15 CT this evening and originated out of Asia somewhere. All of the primary currency crosses got hit at once - Euro, Pound, Yen - all weakened dramatically against the dollar and it is still going on. The Asian stock markets got walloped at the same time in coordinated waves of forced selling. At the same time the US futures markets got nailed as well, down some six handles on the /ES in a near-vertical drop. While this sounds "not that big" to move these markets in a coordinated fashion like this is a trillion-dollar enterprise - this is not some small company that went bankrupt, or even a large company. There is no news coverage at the present time identifying the source of this but it is not small and contrary to some reports it is not "automatic selling"; this is forced liquidation. Folks, if this translates into Eastern Europe where there are severe instabilities already brewing literally everything in the financial world could come apart "all at once." The worse news is that if this happens Bernanke will have killed us (in the US) by extending those swap lines all over the planet during the last six months. These will become utterly uncollectable and they are massive, in the many hundreds of billions of dollars. To those who are reading this, I hope if you're in the markets you are prepared for extreme levels of violence. You must expect that the authorities will try to arrest the destruction if they are able, but you must also be prepared for the possibility that we have reached a "critical mass" point beyond which "duck and cover" is the only winning strategy. Unfortunately. I hope I'm wrong; this is going to be a long night. maybe its the Wilsons offloading their portfolio? Quote Link to comment Share on other sites More sharing options...
ParticleMan Posted February 17, 2009 Share Posted February 17, 2009 May be a bit tunelled, but for what it's worth none of this even registered above the noise floor here. Deningitis flaring up again? Quote Link to comment Share on other sites More sharing options...
Methinkshe Posted February 17, 2009 Author Share Posted February 17, 2009 May be a bit tunelled, but for what it's worth none of this even registered above the noise floor here.Deningitis flaring up again? Dunno - that's what I was wondering. Quote Link to comment Share on other sites More sharing options...
R K Posted February 17, 2009 Share Posted February 17, 2009 (edited) Hmmm....not sure what he was looking at - can't find it. Gold is up $20 and obviously we're down 2% on the FTSE and DOW futures are currently predicting an open below lows, so if we have intra-day falls it could get very interesting. Edited February 17, 2009 by Red Kharma Quote Link to comment Share on other sites More sharing options...
Methinkshe Posted February 17, 2009 Author Share Posted February 17, 2009 Hmmm....not sure what he was looking at - can't find it. Gold is up $20 and obviously we're down 2% on the FTSE and DOW futures are currently predicting an open below lows, so if we have intra-day falls it could get very interesting. Have you checked through the comments for that ticker in the forum? There's some useful links there. Quote Link to comment Share on other sites More sharing options...
Moneyalchemist Posted February 17, 2009 Share Posted February 17, 2009 Have you checked through the comments for that ticker in the forum? There's some useful links there. Looking Bad - this week should be interesting Maybe arch-optimist AEP was right! Forex failure continues in Poland Posted by Izabella Kaminska on Feb 16 21:43. It’s getting bleaker by the minute in Eastern Europe. In case you didn’t catch the latest from the Telegraph’s Ambrose Evans-Pritchard, he warned at the weekend how a growing crisis in Eastern Europe could cause nothing less than a total collapse in the West, or as he put it: “If one spark jumps across the euro zone line, we will have global systemic crisis within days.” To make his point Evans-Pritchard quotes Morgan Stanley’s Stephen Jen on the fact that Eastern Europe has borrowed a total of $1,7oobn abroad. Furthermore about $400bn of that debt has to be rolled over this year - a number equivalent to about a third of the region’s GDP. As we outlined a couple of weeks ago, the concern is now greatest not for the retail mortgage sector, which practiced the issuance of foreign-currency based mortgages on a grand scale, but for corporates — which it appears practiced the art of derivative forex exposure on an even grander scale. And so it comes as no surprise on Monday that yet another corporate forex failure has occurred in Poland, this time at Polski koncern Miesny Duda, a Polish meatpacking business. The stock sank to a record low on the news. As Bloomberg reports: Quote Link to comment Share on other sites More sharing options...
R K Posted February 17, 2009 Share Posted February 17, 2009 (edited) Have you checked through the comments for that ticker in the forum? There's some useful links there. Oh ok, thanks. No, I just read Karl's original missive. I'll go through the replies. Edit: So, seems to be centred around Korean bank Woori?? and a separate issue with Polish Zloty and the Euro. Euro/USD is getting close to it's major support at 1.25 (1.2630 at the moment). Dollar and gold up together suggests they are both now a safe haven play against the Euro (?) Edited February 17, 2009 by Red Kharma Quote Link to comment Share on other sites More sharing options...
ParticleMan Posted February 17, 2009 Share Posted February 17, 2009 Feeds/ quotes all seem to be within expectation here - best as I can work out, Deningitis seems to have made FX volatility his daily "OMFG!!!!eleventy1!!!" issue (take a look at %change overlays on 1-3mo if you still need reasons to stay the heck out of Fx markets); nothing peculiar to USD, a little KRW weakness (but again still within range). There's a few fairly large-ish gilt auctions in process around the globe; perhaps that's moving XAU price, too. Quote Link to comment Share on other sites More sharing options...
BLOW FLY Posted February 17, 2009 Share Posted February 17, 2009 So is/was this much a do about nothing? BF Quote Link to comment Share on other sites More sharing options...
R K Posted February 17, 2009 Share Posted February 17, 2009 Feeds/ quotes all seem to be within expectation here - best as I can work out, Deningitis seems to have made FX volatility his daily "OMFG!!!!eleventy1!!!" issue (take a look at %change overlays on 1-3mo if you still need reasons to stay the heck out of Fx markets); nothing peculiar to USD, a little KRW weakness (but again still within range).There's a few fairly large-ish gilt auctions in process around the globe; perhaps that's moving XAU price, too. Could be. The XAU move all happened in Asia. I guess it got a boost from short covering on the breakout. Quote Link to comment Share on other sites More sharing options...
Methinkshe Posted February 17, 2009 Author Share Posted February 17, 2009 So, nothing unusual going on with currencies, then? There's a "What the **** is going on with Currencies" thread in Breaking Price on the MT Forums but it's on a lockdown - only accessible to certain users. Quote Link to comment Share on other sites More sharing options...
eightiesgirly Posted February 17, 2009 Share Posted February 17, 2009 So, nothing unusual going on with currencies, then?There's a "What the **** is going on with Currencies" thread in Breaking Price on the MT Forums but it's on a lockdown - only accessible to certain users. The last I heard and don't take this as gospel as I am no FX whizz kid is that all curriencies were down against the dollar swissies, euros, GBP, hungarian forint, won, you get the picture, and gold was up. TF mob seemed to think there was a massive demand for dollars. What it all means I don't know, they seem to have all recovered to about half way by this morning so maybe someone big had to put a dressing gown and slippers on at 5am and sort it all out. Quote Link to comment Share on other sites More sharing options...
Methinkshe Posted February 17, 2009 Author Share Posted February 17, 2009 The last I heard and don't take this as gospel as I am no FX whizz kid is that all curriencies were down against the dollar swissies, euros, GBP, hungarian forint, won, you get the picture, and gold was up. TF mob seemed to think there was a massive demand for dollars. What it all means I don't know, they seem to have all recovered to about half way by this morning so maybe someone big had to put a dressing gown and slippers on at 5am and sort it all out. Thanks for the update. A storm in a teacup or a taster of things to come, I wonder. Quote Link to comment Share on other sites More sharing options...
eightiesgirly Posted February 17, 2009 Share Posted February 17, 2009 Thanks for the update.A storm in a teacup or a taster of things to come, I wonder. A bit of both I think, everyone is so stressed and jumpy they see meltdown at every corner, and everything is so unstable and unpredictable it's making everyone stressed and jumpy. Quote Link to comment Share on other sites More sharing options...
R K Posted February 17, 2009 Share Posted February 17, 2009 (edited) Euro is now only 1/2% away from its 1.25 major support against USD - currently 1.25 So, I guess the question is..........or one of them........will it hold and USD sell off? or.....will it not......in which Euro could get spanked......is it too early to think in terms of parity with the dollar? Edit: Forget I said that, I must be mad. Edited February 17, 2009 by Red Kharma Quote Link to comment Share on other sites More sharing options...
Methinkshe Posted February 17, 2009 Author Share Posted February 17, 2009 Euro is now only 1/2% away from its 1.25 major support against USD - currently 1.25So, I guess the question is..........or one of them........will it hold and USD sell off? or.....will it not......in which Euro could get spanked......is it too early to think in terms of parity with the dollar? Edit: Forget I said that, I must be mad. I don't think you're mad; it's the way I've been thinking, too. The Euro has been riding a wave on the back of bad news from the Anglo-Saxon world. Yet the Euro zone is in just as deep doo-doo as the Anglo-Saxon world - if not deeper - especially if one includes the ex soviet bloc countries. It has a lot of catching up to do (or down, to be precise.) Quote Link to comment Share on other sites More sharing options...
hilltop Posted February 17, 2009 Share Posted February 17, 2009 I don't think you're mad; it's the way I've been thinking, too.The Euro has been riding a wave on the back of bad news from the Anglo-Saxon world. Yet the Euro zone is in just as deep doo-doo as the Anglo-Saxon world - if not deeper - especially if one includes the ex soviet bloc countries. It has a lot of catching up to do (or down, to be precise.) I was looking up some of the twelve month performences of european banks and stock exchanges on the BBC website. They are distinctly unhealthy, even to my untutored eye. Your summary is spot on I think. Catch up time has come around and the Greece, Spain, Ireland problems are at last being priced in. The currency market is a bully and now it will give the Euro a kicking to see how resilient it is. Quote Link to comment Share on other sites More sharing options...
Nicholas Cage Posted February 17, 2009 Share Posted February 17, 2009 So he was completely wrong? Quote Link to comment Share on other sites More sharing options...
Zzzzzzzzzzzzzzzzzzzzzzzzzz Posted February 17, 2009 Share Posted February 17, 2009 (edited) I'm hearing incredibly alarming stuff from Poland. Massive government intervention is imminent to support the zloty. Yikes. PS. Instead of scrolling messages leading on from the OP, I'm getting a thread where I have to open up each individual post - is there a way around this? Edited February 17, 2009 by gruffydd Quote Link to comment Share on other sites More sharing options...
Methinkshe Posted February 17, 2009 Author Share Posted February 17, 2009 So he was completely wrong? I don't think so; from what I can gather there was some massive intervention when things were at their darkest which managed to stop the momentum and turn the thing around. But I don't think that will be the end of it; this time they succeeded. But what about next time? Perhaps someone much more knowledgeable about the subject could give an opinion. I just pick up the drift.......... Quote Link to comment Share on other sites More sharing options...
yellerkat Posted February 17, 2009 Share Posted February 17, 2009 PS. Instead of scrolling messages leading on from the OP, I'm getting a thread where I have to open up each individual post - is there a way around this? Open a thread, click on "options" top right of 1st post, select "Standard View". Quote Link to comment Share on other sites More sharing options...
okaycuckoo Posted February 17, 2009 Share Posted February 17, 2009 What it all means I don't know, they seem to have all recovered to about half way by this morning so maybe someone big had to put a dressing gown and slippers on at 5am and sort it all out. Nice one. Quote Link to comment Share on other sites More sharing options...
Zzzzzzzzzzzzzzzzzzzzzzzzzz Posted February 17, 2009 Share Posted February 17, 2009 Open a thread, click on "options" top right of 1st post, select "Standard View". From one ex-Brightonian (Dorothy Stringer - YUCKKKKKKK) - Thanks! Quote Link to comment Share on other sites More sharing options...
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