Worldwide Online Options Trading
Posted by | Posted in Options Trading | Posted on 06-11-2008
It’s worth taking a look around the world to see what’s going on. I’ve realized that I’ve spent too much time focused on the markets and conditions in the United States, a bad idea, considering the world is in this together.
I know I’ve been tempted to be an ostrich and hide my head in the sand, but in the world of options brokers, stock trading and trading options online there can be no sissies.
Today I took a break and looked around at the various market and financial news sources that I use.
The outlook was mixed. Every analyst was guessing. But there were some interesting points.
Most seem to think that the new plan from the U.S. Treasury Department is good. Financial stocks, including Bank of America and some of the regional banks, such as National, were up, reacting to the idea that their balance sheet would be much safer with tax payer money on the right side of the ledger.
Then the attention turned to the earnings reports that are starting to come in. Here is where anybody in online stock trading or online options trading needs to pay attention, because, after all, it is about the earnings.
One thing that jumps out and doesn’t bode well is the Chicago Board Options Exchange Volatility Index. It rose 4.7% to 57.58, which indicates severe stress. The Volatility Index is known as Wall Street’s fear gauge. Personally, I never paid much consideration to it. I often heard it reported, but never looked into what it means or stands for. That’s a project for a day very soon.
Amazingly, auto stocks rose at General Motors and Ford. Not because of sales suddenly advancing, though, but because of the idea floated in the U.S. Congress that the Treasury could purchase auto loans as distressed assets.
Where they will get the money for that is a mystery. Actually, it’s no mystery. They will get the money from my great-great grand kids.
Energy stocks were pretty weak, even though oil prices have risen. I guess not too many think that demand will be robust.
Common consumer stocks, such as Johnson & Johnson seem to be holding their own.
Around the world, Japan has been working to stabilize markets, Australia has poured billions into a stimulus package and Iceland looks like it is opening for business again.
Inflation is expected to climb due to all these efforts. It is already at 5.2% in the UK.
Inflation in the United States should really jump off the charts in the next reporting period.
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