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Unleash The "Henry": VIX Compression On

Tyler Durden's picture




 

With the cash bond market closed, futures and ETFs are on their algo-driven own and sure enough VIX compression is driving the show. Despite a HY credit market that seems a little less exuberant, it appears the powers that be have unleashed the 'Henry' once again... but rest assured those hedges are not being lifted - merely rolled out past the February debt-ceiling deadline.

 

It was all looking relatively uniform for the first 45 minutes but once HY credit decided that all was not well, it appears the 'Henry' was unleashed on the VIX complex...

 


 

And while spot VIX is the driving factor - it appears all that is really ocurring is that hedges are being rolled aggressivley out to the post-debt-ceiling maturities...

 

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Mon, 12/31/2012 - 15:54 | 3110132 scatterbrains
scatterbrains's picture

Anyone hear anything from the house ? Seems quiet..  maybe once the markets close ?

Mon, 12/31/2012 - 15:58 | 3110139 flacon
flacon's picture

"February debt-ceiling deadline" I don't understand. Debt Ceiling was violated yesterday, is due right now, but some are saying it's not due until March, but now it's February after it was April/May time frame. Does anyone know what is going on here?

 

Have we or have we not breached the debt limit right now? Why February now instead of March? God I'm confused.....

 

Come February, will it be pushed out to June/July time frame? What's going on please........

Mon, 12/31/2012 - 15:59 | 3110155 fonzannoon
fonzannoon's picture

Flacon we blew through the debt limit today but THANK GOD for TIMMAY. He is going to put his blood sweat and tears into "extroadinary measures" that will extend out till March. He will be working extra hours and will be sleep deprived and truly exhausted. Stories will be told of him passing out from sheer wear and tear as he pulls levers and stacks cynder blocks and whatever else he does so that your government can save your ass once again.

you are welcome.

Mon, 12/31/2012 - 16:30 | 3110276 negative rates
negative rates's picture

You could roll that one, straight into July!

Mon, 12/31/2012 - 16:02 | 3110158 Panafrican Funk...
Panafrican Funktron Robot's picture

The short answer is that they actually have no fucking idea until the cliff thingy is worked out.  Timmy G can get about $200 bln in headroom once the ceiling is officially breached today.  You could make an educated guess what that means as far as federal funding needs.  Mid to late February is probably a good guess, but that's assuming the cliff deal currently on the table gets passed.  If we go over the cliff, that $200 bln will actually last a few months longer.

Mon, 12/31/2012 - 17:40 | 3110635 ball-and-chain
ball-and-chain's picture

Is anybody in charge?

I'm currently watching Charlie Rangel telling everyone to relax.

So it's obviously time to panic.

http://www.angrysinner.blogspot.kr/2012/12/yesterday-i-hiked-ten-miles.html

Mon, 12/31/2012 - 15:54 | 3110134 Dan The Man
Dan The Man's picture

CNN actually mentioned the $150B outflows from the market...for 3yrs running.  Took them long enough.

Mon, 12/31/2012 - 15:54 | 3110135 The trend is yo...
The trend is your friend's picture

WTF

Mon, 12/31/2012 - 15:56 | 3110140 fonzannoon
fonzannoon's picture

S&P AAPL BAC STAWKS  YAY!!!!!!

Did anyone really think this would end in anyway less than full retard?

Mon, 12/31/2012 - 15:56 | 3110141 Gypsyducks
Gypsyducks's picture

I expect word that no deal can be made about 3 minutes after the ES Mini's close.

Mon, 12/31/2012 - 15:58 | 3110144 muppet_master
muppet_master's picture

like GnR says:

just a little patience....spx now @ 1419 = start SHORTING !!!

sell on the tarp like news announcement of the so-called fiscal cliff on Wed.

today's LOW = 1398, high = 1419 so far...

Mon, 12/31/2012 - 16:00 | 3110154 BlueStreet
BlueStreet's picture

S&P just broke the 100 day, ugh. 

Mon, 12/31/2012 - 16:02 | 3110164 SmoothCoolSmoke
SmoothCoolSmoke's picture

Can Kicking....a market's best friend.

Mon, 12/31/2012 - 16:03 | 3110171 Boilermaker
Boilermaker's picture

Jesus Fucking Christ...

YOU DIDN'T THINK THEY WOULD RAMP THE MARKET??!?!

SERIOUSLY?

Mon, 12/31/2012 - 16:30 | 3110286 negative rates
negative rates's picture

You must be a Princeton man all the way.

Tue, 01/01/2013 - 00:35 | 3111547 DeadFred
DeadFred's picture

Yeah I didn't think they would ramp the market despite all the indicators saying they might. Every MSM shill has been screaming "Cliff, cliff, cliff!!" so shouldn't I have recognized ths as a contrarian indicator? Yes but I was fooled by the way the market has ignored the drama from the start. I figured we were going to get the equivalent of Lucy pulling the football away from Charlie Brown after telling him that he just needs to trust. Instead Lucy punted the can for two months. Go figure.

Mon, 12/31/2012 - 16:05 | 3110181 edb5s
edb5s's picture

Retirement on!

Mon, 12/31/2012 - 16:31 | 3110284 mammoth mo
mammoth mo's picture

So on a day in which the market will be up less than 1%.

 

The vix goes down 20%.

 

 

Mon, 12/31/2012 - 16:54 | 3110412 WmMcK
WmMcK's picture

At first I tried to render (Henry:) VIX as a roman numeral!
Sweet 16 -- maybe I need another drink.

Mon, 12/31/2012 - 17:20 | 3110554 Pareto
Pareto's picture

Fucking beat down on anybody who bought the dip on the VIX this morning.  Takes the escalator up and the elevator down.  EVERYTIME.  Fuck I'm glad I don't hedge with this piece of shit anymore.

Tue, 01/01/2013 - 10:54 | 3111876 XtraBullish
XtraBullish's picture

Never underestimate the replacement power of equities within an inflationary spiral. Everyone gnashing and gnarling over the "ramp" but it is all quite logical - every G20 central bank is debasing their currency and imploding their bond markets. That means that cash is trash - you cannot hold cash. Shorting the E/S is like going leveraged-long cash while going leveraged-long equities or gold or oil is like going super-leverage-short cash - exactly in line with policy-makers worldwide.

Now if the G20 changes policy in favour of protecting their currencies/bond markets, I wiull change my strategy but since the U.S. will NEVER - repeat - NEVER be able to pay off its debt EVER, then the currency behind the debt is doomed and being long such currency is a flawed stategy, the opposite of which is to OWN stocks (and gold and oil and farmland and so on and so forth).

Thank you for a huge day today as the aroma of barbecued shorts was truly sublime.

Happy New Year!

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