Citi's Steven Englander On Black Swan Fatigue, And Why It Is Time To Hedge Tail Risk Again

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Mon, 03/07/2011 - 16:12 | 1027217 Bananamerican
Bananamerican's picture

swan tail bitches

Mon, 03/07/2011 - 16:18 | 1027236 rubearish10
rubearish10's picture

Yes and once you've committed to tail risk management, you cannot and likely should not stop, until your investment thesis/activity has ended. This should be done no matter what the cost, as long as you don't go broke doing it, harr harr.

Mon, 03/07/2011 - 17:55 | 1027553 kaiserhoff
kaiserhoff's picture

Good point, and it does cost, but put spreads are fer cheap if you do your homework.  They also help you sleep at night;)

Mon, 03/07/2011 - 18:01 | 1027581 rubearish10
rubearish10's picture

HR, very important, no doubt. Time is major factor. Big first mistake is to not buy enough (time). In other words, roll forward deep, barbell and participate in upside with whatever "carry asset" you prefer etc....Been sleeping well lately, thanks.

Mon, 03/07/2011 - 16:23 | 1027248 Snidley Whipsnae
Snidley Whipsnae's picture

The Fed has a hammer and everything looks like a nail to them... the one trick pony will continue to print even if it solves nothing.

Mon, 03/07/2011 - 16:22 | 1027251 Scottj88
Scottj88's picture

Its all rigged...

We have treasonous bankers running our system...

Oil, Silver, Gold all going to be rising and especially food prices.  America will be like all other countries, and we will revolt... not by choice but by neccessity.

 

http://thehardrightedge.com/troubledwater/

Mon, 03/07/2011 - 16:27 | 1027263 ZeroPower
ZeroPower's picture

i.e. Hedge your long CHF long CAD and...even, gasp, long EUR positions.

Mon, 03/07/2011 - 16:27 | 1027264 Misean
Misean's picture

It's taking longer for the banksters to get the rube's watching them play 3 card monty to ante up.

Mon, 03/07/2011 - 16:29 | 1027267 dick cheneys ghost
dick cheneys ghost's picture

US ask Saudi's to arm Libya's Guerrillas......

 

http://nakedempire.wordpress.com/

 

 

and congrats to Zero Hedge on time mags list on best financial blogs..

 

http://www.time.com/time/specials/packages/completelist/0,29569,2057116,00.html

Mon, 03/07/2011 - 16:32 | 1027276 Arch Duke Ferdinand
Arch Duke Ferdinand's picture

""US ask Saudi's to arm Libya's Guerrillas......"'

 

Single best way to win a revolution?

...Starve the Government...

http://seenoevilspeaknoevilhearnoevil.blogspot.com/2011/03/single-best-way-to-win-revolution.html

Mon, 03/07/2011 - 17:16 | 1027399 Henry Chinaski
Henry Chinaski's picture

It is impossible to starve government if the FED exists to print money an buy debt.  That's why the goverment will never willingly return to a gold standard.  If people had to pay for government out of pocket, things would be different.

Mon, 03/07/2011 - 18:27 | 1027675 sschu
sschu's picture

If people had to pay for government out of pocket, things would be different.

This is so true.  While we rail against the Fed, and deservedly so, it is likewise the Federal Government that deserves our wrath and focus.  The Fed and the government are mutual addicts and enablers, each feeding the other's habit.  They are co-dependents and must simultaneously be brought under control. 

They will fight to their destruction before giving up, the battle is not even begun. 

sschu  

Mon, 03/07/2011 - 16:34 | 1027284 Snidley Whipsnae
Snidley Whipsnae's picture

I second the congrats to Zero Hedge for all their fine reporting. If not for them and a very, very few other sites we would all be dancing in the dark. Hat tip!

Mon, 03/07/2011 - 18:01 | 1027572 kaiserhoff
kaiserhoff's picture

Well said, and not an easy pace.  None of us has complained about a slow news day in a coon's age.  No offence, Rocky.  We all know you are a spring chicken at heart.

Mon, 03/07/2011 - 16:29 | 1027271 IQ 145
IQ 145's picture

 An environment in which hedging the black swan type future has become unpopular, is exactly the environment in which you want to be spending money on cheap Puts.

Mon, 03/07/2011 - 16:33 | 1027280 Snidley Whipsnae
Snidley Whipsnae's picture

Compliments of Jesse...

"The weakness with this US Dollar DX index is that it is highly weighted to the developed economies of Europe and Japan. As such it may not reflect erosion of dollar purchasing power vis a vis the BRICs, and external measures such as gold, oil, and silver. It may be masked by the mutual weakness of central banks all inflating their currencies in unison."

...and...

"Rather than rallies through economic vitality and recovery, the dollar rallies have been marked by relative declines primarily in the euro on their sovereign debt problems. It is almost like a couple of drunks leaning on each other for support, except that the US is picking the Eurozone's pockets while they do it."

Remainder of comments here... http://jessescrossroadscafe.blogspot.com/

Mon, 03/07/2011 - 16:41 | 1027294 Sokhmate
Sokhmate's picture

"Black Swan Fatigue" LOL. ZHers should seriously consider creating a 'ZH' terms dictionary.

Mon, 03/07/2011 - 16:56 | 1027343 Anaxagoras
Anaxagoras's picture

Tonight's Movie:

Dr. StrangeBen, or: How I Learned to Stop Worrying and Love Inflation

Mon, 03/07/2011 - 17:41 | 1027498 buzzard beak
buzzard beak's picture

Look out for my upcoming book, "Black Crow: The Mystification of the Thoroughly Mundane"

 

Mon, 03/07/2011 - 17:54 | 1027554 KickIce
KickIce's picture

Black Swan morphs into dying duck.

Mon, 03/07/2011 - 18:18 | 1027648 rd
rd's picture

Occam's razor: Moral Hazard! Thank you Mr BB.

Mon, 03/07/2011 - 20:26 | 1027983 lsjcma
lsjcma's picture

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Mon, 03/07/2011 - 21:49 | 1028257 99er
99er's picture

VIX

May have its groove back.

http://www.zerohedge.com/forum/99er-charts-0

Tue, 03/08/2011 - 01:09 | 1028760 Grand Supercycle
Grand Supercycle's picture

Despite market intervention/QE - natural market forces can not be stopped – only delayed.

When the market does reassert control – the reaction (the overdue correction) may be even more extreme due to that delay.

And some may erroneously refer to this as a Black Swan since it’s ‘unexpected’.

However they will be wrong because major market events can be predicted by some analysts.

http://stockmarket618.wordpress.com/2011/01/30/sun-jan-30

Sun, 03/13/2011 - 20:41 | 1047739 trendybull459
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