No the Federal Reserve loans reserves to member depository institutions at the discount rate.
You should really read a few chapters from a macroeconomics or money and banking text book to get a handle around FED workings.
Yes you do have it wrong. Depository institutions can borrow reserves directly from the FED at the discount rate. The Federal fund rate is the alternative source They are not borrowing from the FED__they are borrowing from the federal funds market. The federal funds market is an interbank market in reserves__with one bank borrowing the excess reserves of another bank. They pay the FED funds rate. These loans are usually 24 hour (overnight loans). The federal funds market is actually a private market but the FED sets the rate.
REITs are not a depository institution__they cannot borrow from the FED or the federal funds market.
The FED is not buying stocks. For awhile the Treasury did__GM, some big money center banks
"Yes, it is the Fed"
Telling a wondering student so far from removed from 'correct' is not being simplistic or notational__it is just not even close. If you do not want to understand how central banking works that is one thing. Posting such as you did is something else.
Well I do not know where you get three. Neither a mortgage or common stock is a derivative but 'financial instruments'. A derivative is something whose value changes upon a change in an underlyer financial instrument, commodity, or currency. You may want to visit the book "All About Derivatives"; McGraw Hill.
No it isn't. Joe's loan valuation is set and now amortized . Any packaging and subsequent sale depends upon pricing of like securities at prevailing interest rates not upon an underlier. AGNC equity is not a derivative of anything. The way you are going about it everything would be a derivative.
The reason in finance that a mortgage is a financial instrument is because Joe is considered to have issued a 'bond' to the lender with an amortized schedule (similar to a sinking fund). Now when those mortgages are packaged into a mortgage backed bond/security (MBB/MBS) that is a derivative. Collateralized mortgage obligations (CMO) are a pool of MBB/MBS that are then cut up into component parts. All of a CMOs component parts (traunches) are interrelated. A change in one causes all the others to change, as well; hence a derivative. Credit default swaps (CDS), collateralized loan obligations (CLO), and collateralized debt obligations (CDO) are derivatives. Synthetic CDOs are a derivative on a derivative.
That is why they write text books. So people that posts on boards like this cannot just say things like 'we are in a recession/depression', or the most common idiocy posted ' FED prints money'.
Once you read the numbers; you will know the opportunity to convert will never happen.
At the option of the holder, each trust preferred security is convertible into Alcatel-Lucent ADSs, subject to an additional adjustment under certain circumstances. The following table summarizes the terms of this security.
Conversion ratio 40.3306
Conversion price U.S.$24.80
Redemption period at Alcatel-Lucent USA Inc.’s option After March 19, 2007
Maturity date March 15, 2017
Fortunately I bought LUTHP at 554.59; so I am a happy holder. I just can't decide whether to run with the gain or stick while collecting for me what is a 12.9% yield (based on purchase cost), untill they redeem at 1000.
I am watching the bonds bid/ask trends in the market. I figger if the bids start trending lower for awhile, that tells me debt holders again are getting concerned with ALUs cash flow. Then I would probably bail.
Good luck to you!
"many, many more things than you think are derived from other things'
That is not what a financial derivative is about. Do yourself a favor__travel to a bookstore_one where you can sit and have coffee and spend some time with the book I mentioned. Then come back and apologize. Like I posted this is why textbooks aare published.
Did I not post this earlier "Any packaging and subsequent sale depends upon pricing of like securities at prevailing interest rates not upon an underlier"
That is it__I am not going to debate back and forth with someone who wants to redeine academic and industry accepted concepts. I am going to post to you what I tell students attending my financial futures class. If you want to redefine ; there is a well established process.
Present the thesis, do the research following scientific methodology, support your conclusions, publish the material, having it reveiwed by subject matter experts, edit, review again. When finalized offer your work for academic acceptance.
Again this is why they publish textbooks.
Neither you or Rich have any measure of creditability when discussing central banking. In spite or your supercilious projections when you both post in terms of the 'FED' printing money only your ignorance rises.
The FED prints meeting minutes, reports and studies. Money is printed by the Treasury. Open up a macroeconomics or money and banking textbook and learn how a fractional reserve monetary system functions. Then return to the board and apologize to all of us who are sick of wading thru your pathetically childish repertoire searching for information of value!
Get a futures account and take option positions on the index's like the OEX and Mini 500. Consider the premium paid insurance money.
Those levered ETFs are inefficient past a one to three day holding.
Obviously your shotgun posting approach is more important than using correct numbers. With all your beating of the ‘total return’ drums; at least you should have included dividends in the numbers you posted. Even without divs your 14% number is incorrect.
Whether you are a Bozo, flame, or a virus__one thing for sure this post exposed your lack of fundamental financial analysis.
herehear The numbers for 2012 are: +13.41 and total return +16. And the point is you cannot blast this board with all your 'all cap' messages touting holding for total return and then ignore it later. Visit S&P indices website and learn how they calculate their index returns. My numbers are from their site. The only #s that count!!
You have achieved one thing of note though. You consistently post more incorrect information than YBF and raybans. Like minds??
So that would be an inverse correlation between treasuries and REITs. Opps sorry ole bike but that is not true. So until you obtain the necessary fundamental financial analysis education/skills try to refrain from taking on the 'big boy' work.
Until then your multitude of posts here just labels you another amateur idiot whose postings waste bandwidth!
I am not sure where you obtained those Yahoo #s from. Under key statistics Yahoo showed (access 3 minutes ago) as 24.03M float and 1.0M short (as of 2/28). That is too long ago to be useful anyway.
Fidelity shows (as of 3/20) 31,008,000 outstanding and 1,002,944 short with 3.23% ratio and 3 days to cover. Generally I find you cannot trust Yahoo #s.
I have no idea where big got his/her 38% from.
Last I remember the idiot was posting 'guaranteed' projections that the broad market was starting a major swoon: immediately. At the same time the idiot was offering 'signals' advice for money [against his Terms of Service] agreement with Yahoo of course. Since then almost all major indexes have registered all time HIs. Just once I would like Yahoo to 'buck up' and publish who these snake oil posters are; so they can be legally held responsible.
Ever run into that "Riccarro Money Quotient" snake oil idiot on one of these boards. Same MO. Graps a msg brd using the shotgun approach of posting trying to charm someone into giving them some coin.
It appears you have little to none idea of how either the core CPI or non-core CPI is calculated. The Bureau of Labor Statistics surveys 80,000 (that is right 80K) consumer price inputs to calculate those CPIs.
So, the idiocy of your post portends you just have a hair up your bung for the FED.
You make a vaild point. XOM and AAPL would provide specific security and sector (diversification within an economic cycle) but not broad market (economic cycle diversification).
Investors need to construct correlation matrices and watch for trending correlation changes. Even the large capitalization Emerging Market (BRIC) ETFs have tend to favor export and commodity related businesses which provide little diversification from the broaqd market.