Am I just clueless here or am I really seeing LEH and GS up considerably. To me a 57% amd 53% (respectively) reduction in earnings is terrible regardless if it is above initial estimates. The market is also reacting strongly to a possible 100 basis pt. rate reduction. But… is this rate cut really going to do anything? And is it too late?
We’re all clueless. The market is clueless. Look at the BSC 10k. Tell me you can get any kind of reasonable value whether it be $2 like the market priced it on Sunday, $7 like the market priced it today, or $50 like the market priced it 2 weeks ago. Nobody knows…
CFABLACKBELT Wrote: ------------------------------------------------------- > The market is also reacting strongly to a possible > 100 basis pt. rate reduction. But… is this rate > cut really going to do anything? And is it too > late? Currently, market doesn’t even know what is wants.
I guess the best way to look at it is long-term. We will continue to see bad times as we are not out of this mess. The “bottom” as is thrown around on CNBC was not yesterday in my opinion. House prices still need to fall and other companies still need to suffer.
Sry dbl post
Yeah, LEH bounced considerably today. I thought it might do that, but I’m not sure what the right trading strategy to do it would be. Buying call options seem like the logical way, but the volatility presumably was so high that the price was also more expensive. I’m still a bit in the dark as to what principles to apply to figure out if an option is a good deal or if it is just expensive insurance.
Option prices are outrageously expensive on all financials but I guess they need to be!?! When the premium is through the roof it’s sometimes easier to pickup the options when the underlying is going the other direction… which doesn’t make sense at all.