Monthly Archives: January 2016

Change of Identity

The risk cannot be created, but the circumstances for its predictable occurrence (by default) can be. Risk has a constant quantum value, but its identity can effectively change (added over time). Its exchanged value can vary from its real value. … Continue reading

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Emergent Value of the ETF

Retail investors got burned on mutual funds, seduced by the hedge effect. A new RTV emerged to fill the gap and create the spread that realises the risk-variance premium. An ETF, despite being retailed as a hedge in the form … Continue reading

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Creating the Unit of Exchange

Capitalism survives the ZHE by creating different units of exchange. Despite being highly detrimental, big business and government have spent a lot of time and effort to conserve financial derivatives. Remember that Dodd-Frank does not eliminate the use of “derivative … Continue reading

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ETF (and the Zero-Hedge Effect)

The promise of an ETF is diversity and liquidity. The peril of the Exchange Traded Fund is its “bundled value” (the “securitization” that identifies with the fraud associated with the Great Recession) and its actual illiquidity (the Zero-Hedge Effect, or … Continue reading

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Negative Support; Positive Resistance

When Japan has negative interest rates it supports the dollar. For Japan, the negative rate has a positive effect. Positive support derived from a negative rate sounds unnatural. It is confusing, and when something is confusing there is a lot … Continue reading

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Controlling for the Effects

More than anything, capitalism operates to control for the added identity. This is to control for the probable effects, which is to measure support and resistance. Support and resistance is arguably ambivalent. Since support effectively measures resistance, it measures the … Continue reading

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The Risk Differential

The difference between what you think something really is and what it actually is gets support when reality is measurably resisted. If reality is actually its perception, then reality can change. If what we think reality is changes, then it … Continue reading

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