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SPDR S&P 500 ETF Message Board

  • xtgeminiman Feb 6, 2013 8:04 PM Flag

    EVERYONE Thinks QE Inifinity Means Markets CAN'T Go Down

    Why do people believe this? QE has shown diminishing market returns. What's to prevent the big institutions from trying to leave before everyone else?

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    • Japan has had about 12 rounds of accommodation or so and the N225 is 70% of its 1989 peak.

      Sentiment: Strong Sell

    • My theory is that the big institutions borrow from the fed at 0 and buy the treasury bonds and use those assets on the balance sheet to meet the capital requirements.....their loan portfolios are in the tank and they can shine the spotlight on a large treasury portfolio and say our capital ratio is fine....thus they can't exit because these treasurys are propping them up as they unload or mark down their other loan assets.....just a big shell game....fed's giving them money to stay afloat....they are creating a leveraged bond portfolio and the leverage is essentially 0 rates and unlimited borrowing capacity from the fed window.....

213.98+0.10(+0.05%)Oct 21 8:00 PMEDT