Forex rebates on every trade - win or lose!

BOE lends 1.55 billion at 6.755% Wednesday. No names given.

Well I have to say the markets are all very calm at the moment. Are they in denial I wonder or perhaps they don't read the stuff that I do.

Has anyone come up with a plausible explanation that does not involve the word 'crash' for the 65,000 contracts for the SPX 700 calls ?

I wonder if the party making the monster bet has also read of the $90 trillion backlog of commercial paper that had not rolled over on Aug 23.

Perhaps the commentator that said 'the system is collapsing right before our eyes' was having a bad hair day. It'll be alright on the night - won't it ?

At least Moody's is confident - "banks have sufficient capital to meet needs, threats to the global banking system are overstated". That's alright then, I can come out from under my comfort blanket now !

Edit - I have come across an explanation for the apparent monster down bet :

"So a whole lot of CALLS were sold at very low strikes and a whole lot of CALLS were bought at low prices. The currently quoted price for the 95 Call is 51.40 / 51.70. This means that with the SPY at 146.23 as I write this the SPY is valued at 51.70 + 95 = 146.70. These Calls have a delta of 1, meaning they are very tied to the SPY movement at a 1 : 1 ratio.

So you need to look at the two ways each side of the transaction make money. The buyers make money if the SPY goes up ABOVE 146.70 not down. The sellers make money if the SPY doesn't go up. It doesn't have to come down, they have already made their money by selling the calls and collecting the premium.

On the PUT side, there isn't the same volume at these strikes. There is 1 open interest at 85 for example. The only 'odd' volume is that there are 9494 open interest on the PUTS at 96.

This isn't the doomsday scenario that people describe, but it certainly is very, very weird."

Phew! Cable not for faint hearts at the moment. If you've got it, bank it!

Too right ;)

Forex - Dollar firms vs euro, pound after Bernanke comments; yen gains
AFX


LONDON (Thomson Financial) - The dollar firmed against the euro and the pound after US Federal Reserve chairman Ben Bernanke offered some relief to markets by saying that the Fed 'stands ready' to take further action to provide market liquidity as necessary, The yen gained, however, as the currency benefited from ongoing safe haven flows after Bernanke stated that it is not the job of the Fed to rescue investors.

Speaking at the annual monetary policy symposium in Jackson Hole, Wyoming, Bernanke said financial markets can have economic effects 'felt by many outside the markets'. The Fed will 'act as needed to limit the adverse effects on the broader economy' that may arise from the recent turmoil on financial markets.

He warned, however, that it is 'not the responsibility of the Federal Reserve -- nor would it be appropriate -- to protect lenders and investors from the consequences of their financial decisions.'

At 3.17 pm BST, the euro was trading at 1.3637 usd, down from 1.3666 previously, while the pound fell to 2.0118 usd from 2.0163 previously.

Against the yen meanwhile, the dollar fell to 116.11 from 116.30.

Thomson IFR Markets analyst Rhonda Staskow said the remarks have two aspects to them - on the one hand it is positive for markets that the Fed is ready to provide more liquidity as necessary. However, the comment that it is not the Fed's jobs to protect lenders and investors will 'dampen the hope of those looking for the Fed to bail them out'.

'This has fuelled expectations that the impact of the credit crunch and housing crisis will continue in weeks to come,' she said.

jessica.mortimer@thomson.com

jkm/slj

Calendar updated for next week's fun and games -- don't forget Monday is Labor Day in the U.S. (when they don't -- labor, that is).

Bonjour mes amis.

Hols are now over unfortunately, although I'm pleased to report that I'm sans white bits. Have I missed anything this summer?

Looks to me like it's approaching crunch time for the Dollar over the next few weeks. I'll paste up a chart to show what I mean when I get some time this week.

These are the Dollar charts that I promised.

First, Dailies over the last 3 years.



Then zoomed in over the last 6 months with some indicators for good measure.

So what d'you reckon Hils? Or anyone else ...

I have a sneaky feeling that gold might have peaked this morning, and whilst there looks to be further overall weakness in the $ shorter term, there's going to be an almighty reversal.

Gotta dash, I'll post a thingie when I get back.

I don't have a view on anything further out than the 1- and 10-minute charts atm, Choccie.

gbp/usd 4hr chart. my view - looks like its up to me, but we've got a channel forming, and also triple divergence on macd so wouldnt surprise me if we dont see the recent top broken for a ...........? The daily looks up to me...........confusing aint it! Think hilary hit the spot, trade what you see atm

I was commenting on the longer term, gofe, with Hils' approaching $ crunch time in mind.

The way I see it, gold may or may not bust through down slopey resistance off last summer's high. And it's certainly giving it a good whack today.

Don't think it's a coincidence that EUR/$ is trying once again today to breach the high from December 2004.

Errrrrrrrr .......... Is it just me who can't access FX PowerCharts this morning? One PC produces a long string of source code where the applet should be, the other is just blank???????????

Had a problem with Netdania too, the java thingie took ages to load this morning, and it's been running very slowly since yesterday.

Intellichart is OK, Choccie.

Funnily enough, Sun Java prompted me to download an update this morning. That might be the cause of the problem. If it ain't broke, why do they try to fix it?????????

Cheers Hils, I'll have a look at Intellichart cos I need to find another source for $ index, as Netdania have removed it from the list for some reason.

I haven't noticed any java prompts? :S

Just had a quick check and Powercharts here OK Hils, but this is on a machine I don't use for powercharts normally, so no user settings present - and no java update prompt yet.

Hil: The thing you need to learn about software is that it's always broke. It's considered polite to fix it when people find out.

MM (California)

PS: thanks for updating the Calendar for me ;-)

Anyone trading this evening? :)

Just passing the time ...

Lawmakers Push for Immediate Disclosure of BOE Votes on Rates

By Jennifer Ryan

Sept. 18 (Bloomberg) -- The Bank of England should say how policy makers voted on interest rates the day of the decision rather than two weeks later when minutes of the meeting are published, U.K. lawmakers said.

Providing more information sooner about decisions may help limit market volatility when policy makers make an unexpected move, the Treasury Committee in the House of Commons said in a report assessing the bank's performance over the past 10 years. The lawmakers from all political parties said they would like to avoid the kind of market swings that occurred after the surprise rate increase in January.

``The system at the moment seems to encourage two weeks of greater uncertainty than is necessary,'' John McFall, a member of Parliament from the ruling Labour Party, said in a statement in London today. McFall heads the Treasury committee.

The implied rate on the March futures contract jumped 19 basis points to 5.7 percent on Jan. 11, the day the bank surprised markets with an a quarter-point increase in its key rate to 5.25 percent. The implied rate slipped 6 basis points after minutes published Jan. 24 showed the decision was approved in a 5-4 vote, the first time since 2000 that so many bank officials voted against Governor Mervyn King.

The contract settled to the three-month London interbank offered rate for the pound, which averaged about 15 basis points more than the central bank benchmark for the past decade. A basis point is 0.01 percentage point.

Discussing Votes

The report also recommended that the minutes of the central bank's rate-setting Monetary Policy Committee meeting should identify individual members' views. They should also testify to the Treasury Committee once a year about their voting record and give their own outlook on economic issues, the report said.

Naming members in the minutes would hold them ``accountable for their views, and this will help explain their votes,'' McFall said.

Lawmakers backed the bank's inflation target, where consumer price gains of more than a percentage point above or below 2 percent require the governor to write an open letter of explanation to the chancellor of the exchequer.

Inflation slipped to 1.9 percent in July, the first reading below the target in 16 months. The range around the target has been breached once in the past decade, when the rate touched 3.1 percent in March.

While the central bank deserves ``a significant amount of credit'' for the low rates of inflation over the past decade, there is ``a need for more information to be provided by the Monetary Policy Committee to aid both the financial markets and the general public,'' the report said.

To contact the reporter on this story: Jennifer Ryan in London at Jryan13@bloomberg.net