Possible US crash implications for DR

C

Chris

Gold
Oct 21, 2002
7,951
28
0
www.caribbetech.com
OK, I read it, and it is easy stuff ;)
Really, I'm familiar with bell curves and the pareto principle - not the underlying math, but as statistical tools. Don't have time to Google the Fat Tail stuff at the moment.

Are you saying that this is a 'dislocating financial market event'?
If you are saying that, do you have a further conclusive statement? I'm tempted to ask .. OK, and then? ;)
 
D

drtampa

Bronze
Oct 1, 2004
1,087
29
48
New Ulm, TX
Cfc

Interesting, today one of my mutuals that is heavy into CFC posted up for the first time in two weeks.
Maybe we have reached the bottom.
 
L

Lambada

Gold
Mar 4, 2004
9,478
410
0
80
www.ginniebedggood.com
Chris said:
Are you saying that this is a 'dislocating financial market event'?
Click to expand...

Or is mondongo saying that in between the periods of small changes there are both surges and crashes that wouldn't be predicted by a normal distribution model?

mondongo, is this the financial markets version of probability theory?
 
D

drtampa

Bronze
Oct 1, 2004
1,087
29
48
New Ulm, TX
With the Dominican currency so closely tied to the US dollar, it may be very interesting when you go to buy a new Toyota. The US Dollar has fallen 10% against the Yen and the slide has not yet abated.
The Peso has not risen versus the US dollar. I don't check the Peso vs the Yen.
 
P

pelaut

Bronze
Aug 5, 2007
1,089
33
48
www.ThornlessPath.com
Sure sounds like the Global Warming debate in a new venue. Crap wrapped in extrapolative pseudo-science. Just economic Lysenkoism this time.

Think catastrophes such as Sino-Russo alliance, Japan and China start to dump dollar debt, repatriated dollars suck (as Cramer says) 50% of the value from the dollar and cyper-attacks take down comms on the ground and in space with a single counter-rotating load of buckshot in the vulnerable orbital shells we put up.

If you're going to do a Henny-Penny you may as well do the real thing, not run around worried about Ivy Leaguers that kited bad loans or idiots who got addicted to junk mail credit cards. Let 'em eat (cake, cards ... whatever).
 
A

aegap

Silver
Mar 19, 2005
2,505
10
0
....
pelaut said:
The Fed cut is a bail-out.
Click to expand...

Not so.

"They are not being saved. ... The fed is not buying these bad loans. It is not accepting them as collateral. It is merely injecting cash into a system that is temporarily short of cash. If there are bad loans, the piper will be paid in full."

"It is an appropriate government response to a well-known market failure, known as collective action problem. That is, if everyone keeps lending to good customers, and rolling over good loans at a somewhat higher rate, then in the end, this thing will get worked out, people will take their haircuts, and markets will reprice all this stuff in an orderly way. But if everyone acts on fear and decides to pull back at the same time, then everyone will wind up worse off. So this is getting everyone to act collectively in their collective best interest, rather than doing what may look to be in their short-term interest but in fact creates a self-fulfilling downward spiral. The interventions help to convince people to act rationally, calmly, and not throw out good assets and good loans with the bad. It prevents everyone from running for the exits at the same time, which can get a lot of innocent people burned." ...
 
Last edited:
Tamborista

Tamborista

hasta la tambora
Apr 4, 2005
11,747
1,343
113
Today's High on The ES was coincidently a 50% fib retracement from the July 17th highs. We need to close above 1470.16 for this "rally" to have any significant legs.

tambo'
 
M

mondongo

Bronze
Jan 1, 2002
1,533
6
38
Lambada, that's an excellent synopsis. My contention goes even further than claiming you cannot use normal type distributions to model the leveraged financial markets (my guess is that the models will include some form of "fat tail" in the distribution).

My claim is that you cannot accurately model these events. Highly leveraged hedge funds and corporations are just doomed to go out of business whenever there is a shock to the system.


Chris, I do believe this is a 'dislocating event'. Central Banks around were forced to take action beacuse the 'free market' was temporarily malfunctioning. As for what happens next, no one knows. As the US Fed said, we are now more likely to have economic slowdown of some form.

Almost on cue, the weekend edition of the Wall Street Journal prints an article on the works of an economist who predicts that these dislocating events happen periodically.

In Time of Tumult, Obscure Economist Gains Currency - WSJ.com


aegap, you might be interested in this weekend's Barron's cover.
 
A

aegap

Silver
Mar 19, 2005
2,505
10
0
I suppose neither of you tow guys bothered to check the Barron's cover Mondongo mentioned. Hint, hint, ..

​
 
Last edited:
M

Market Economy

New member
May 9, 2006
59
0
0
My two cents,

The impact of a US recession on the DR economy will depend on the length and shape of the recesscion (V shape or W shape).

If it is a V shape and prolongued, expecte the worst. First exports will suffer, then (possibly at the same time) tourism and remittances will suffer. A deceleration of these three hard currency earners for the country will mean very tough times for the country (maybe a return to the 1990-1992 crisis) Hope I am wrong.
 
P

pmey27

Member
Oct 12, 2006
339
0
16
The dollar!

The dollar is becoming worth less and less as we all know and now this spring the govt will start giving away $600 to nearly every taxpayer. This is just printing more money like putting bubble gum on the hole in the dam. In my opinion it is best to be investing in hard assets such as gold and silver and property which will eventually rebound. Gold and silver are climbing to all new highs. What will happen in the DR is anyones guess as the politicians and powers above get in cahoots with each other and wash each others hands and backs!
 
C

Chip

Platinum
Jul 25, 2007
16,772
429
0
Santiago
What astounds me is that their are so many experts with so many opinions and yet nobody was saying anything about what the ARM loans were going to do to the housing market when it became saturated. Do they just forget the law of supply and demand when these numnuts go to graduate school, or did greed just get in the way? I vote for the latter.
 
Tamborista

Tamborista

hasta la tambora
Apr 4, 2005
11,747
1,343
113
Ben will be almost out of bullets after Tuesday.
Fed Funds below 2.00% next cut?
I am holding on to my Gold for now.
 
You must log in or register to reply here.
Top Bottom