Archive | Derivatives

Should Online Article Directory Sites Crack Down on PLR and Derivative Online Content?

Many online article marketers are looking for ways to hyper-space their web presence to drive more traffic to their websites. They want massive amounts of traffic not trickle traffic. They also want lots of incoming links and they want the best search engine ranking. Basically they want it all and they want it now, only with one caveat; they don’t want to have to work very hard to get there.

This opens up a huge problem for online article directory sites which are being used by online marketers who are willing to use short-cuts; for instance, PLR content, ghost written articles from India for $1-2 each, or AI Artificially Intelligent Software to create derivative articles of those previously posted.

If the top online article directory sites allow this stuff, they will have huge directories full of articles, but most will be junk. If not they will be used to basically SPAM the search engines with crappy content, and risk being delisted. At least one of top online article directory sites has taken a leadership role and is culling these “short-cut tactics” by online article marketers, and personally, I am glad to hear it too.

Indeed, I am very happy to see the crack-down of this nonsense. I believe it will help the company’s site. Why do I believe this? Well, you see, I’ve met so many of the member article authors by email, and I must say this particular top online articles directory website has some “stand-up” superstars, I mean really “Quality Individuals” and they are REAL, sincere, caring, and serious about their businesses.

These article authors care very much about their reputations, and they are using their real names, and do not have a bunch of nonsense trinkets or online garbage they are peddling. They are not selling hype, or junk, they are promoting their businesses the proper way. If I was still running my franchise company, these are the people that I’d choose as my vendors, they are the people who’d I’d trust, because they are in it for the right reasons and long-term.

Therefore, I really am glad to see what at least the ethical article content directory websites are doing because, these writers and authors are great-people and they are really trying and they should not have to compete against a group of people who do not care, and are gaming the system and taking shortcuts. I sincerely hope that everyone will please consider all this.

Lance Winslow is a retired Founder of a Nationwide Franchise Chain, and now runs the Online Think Tank. Lance Winslow believes that if you need decent online content or an online article content writer then go to http://www.bloggingcontent.net

Note: All of Lance Winslow’s articles are written by him, not by Automated Software, any Computer Program, or Artificially Intelligent Software. None of his articles are outsourced, PLR Content or written by ghost writers. Lance Winslow believes those who use these strategies lack integrity and mislead the reader. Indeed, those who use such cheating tools, crutches, and tricks of the trade may even be breaking the law by misleading the consumer and misrepresenting themselves in online marketing, which he finds completely unacceptable.

Author: Lance Winslow
Article Source: EzineArticles.com

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Derive Inner Strength From Meditation

Having inner strength is very important in order to face any negative energies or thoughts. The inner strength derived from deep inside prevents you from getting swayed by undesirable circumstances in life. You become self-confident and learn to practice self-control. But how does that happen? Meditation is a great way of developing your inner strength.

Meditation is defined as a state in which an individual’s attention is concentrated on a particular object of thought. In such a state, the attention of the individual is turned inwards to a single point. It is often acknowledged as a crucial element of religions practiced across Asia, such as Hinduism and Buddhism in countries such as India, China, Sri Lanka, Indonesia etc. Meditation has been practiced by these religions for more than 5,000 years.

Meditation teaches you a lot of things. It can help in generating thoughts that are below the threshold of conscious perception. The unconscious mind holds a stock of information and details that help in the formulation of other key skills. In order to be able to meditate perfectly, one has to focus on creating a balance between the subconscious mind and the inner self.

As the main objective of meditation is to bring the conscious mind and the subliminal mind together, it further works to give us strength and an insight. The coming together of the conscious mind with the subliminal mind is possible when the thoughts about positive attitude are evoked. It helps our minds realize the information that may be used for making desirable changes in our life and improving its overall quality.

Meditation develops inner strength because it programs your brain and the inner mind to stop getting any negative thoughts. This clears the way for positive thoughts. In meditation, you learn to do this again and again till you get it right.

The other crucial way in which meditation acts to build inner strength is by removing the energy blockages. If one wishes to end a mental turmoil, he or she has to understand the underlying reason behind it. When you meditate about the causes behind your suffering, you tend to gradually overcome them. Meditation is an energy enhancement technique that helps in removing any energy blockages.

Through meditation, one can clear oneself of all the negative thoughts and a lack of confidence. This would help in creating positive vibes not only for yourself but also for people around you.

Meditation is an art of positive energy that requires a lot of your time, effort and practicing skills. It will not change your life overnight. You have to practice it regularly with concentration for many years. Give your effort, time and patience to the meditation process and it can help you derive your inner strength.

Andrew James offers a no cost video showing you step-by-step how to overcome negative thinking patterns. Please visit http://www.stopthenegativewaves.com.

Author: Andrew James Bradley
Article Source: EzineArticles.com

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Derivatives Explained – Part 1

Most people do not know what CDS’s, Credit Default Swaps, are or have even heard of them, but they have the potential to sink every bank in the country! No joke. Banks have trillions on the line with these CDS’s and they are losing big. Credit Default Swaps are used by speculators to bet uncertainty of banks and financial institutions. The ill fortunes of banks and the mortgage business have sent CDS’s into the hundreds billions of dollars. Speculators get paid off huge with all the foreclosures and write offs.

A Credit Default Swap is just a friendly bet made by two parties. Party one bets some event will happen like a banks credit rating will fall or the entity will fail to pay bonds. Pension funds used derivatives to hedge against millions in bonds they own. So if the bonds fail they still collect on the derivatives. But speculators used the loophole to buy huge amounts of CDS’s and then spread rumors a bank was in trouble with mortgages.

Speculators first buy CDS’s with a bank and then they short the bank. This means as the banks stock price falls their CDS’s go way up in value. Speculators start rumors that the bank is having trouble and they cause a panic. As people hear the bank has trouble they pull their money out of the bank causing the bank’s stock price to sink even lower. Then the Speculators plant even more news stories and buy more CDS’s. In the end the Speculators sink the bank, like Lehman, and they make millions in the process.

Only Fannie Mae and Freddie Mac were in terrible shape. It didn’t take much to get people scared and make a run on the bank. This is why Washington Mutual, WAMU, failed so fast. WAMU could have lasted and sold themselves if they had more time but the speculators used naked shorting and rumors and within days people were pulling their money out of WAMU and the FDIC had to step in and takeover WAMU. The SEC let these speculators act like pirates on the high seas! They wreaked havoc on the fragile mortgage industry and made themselves rich by telling lies basically.

But in a wicked turn of events these CDS contracts could become worthless. It seems that as these banks collapse and are taken over these CDS’s become defunct and non enforceable with the change of ownership. There is nobody to collect from and speculators end up holding worthless paper. Granted this paper was worth billions just last year. The mistake the speculators made was agreeing to a contract that wasn’t guaranteed. These speculators paid millions for the rights to these CDSs and now they don’t even get that money back.

Now we see the Bush administration is bailing out the banks and the speculators will get paid after all! In a normal capitalist market we would sell the banks off, the CDS’s would become worthless, and a new bank would emerge. For some reason our Treasury Department and the Federal Reserve think we have to save these banks from collapse. Why? I would rather they just buy the banks out, make the CDS’s worthless, and setup a national bank owned by the government. It would be far cheaper than having to pay out all these CDS’s that will start appearing in the next years!

The Bush administration was no friend to the taxpayer. Ask them why they don’t just say to the banks “You will soon be insolvent and we know it. The only way to survive is to sell your self to us very cheap and get $1 or $2 per share. We won’t have to pay out the CDS’s and therefore we will become profitable very fast”. But no! The Bush administration will save these banks and pay off the speculators and stick you and me with the 2 trillion tax bill. This is not capitalism. This is cronyism! Part 2 is coming soon.

2008 All rights reserved

Reprint Rights: You may freely reprint this article only if you post the entire article with no changes. You may not remove the credit to and copyright notice to unitedstatesvicepresident.com. Changing the article in any way invalidates these reprint rights.

Steven Fox, a jack-of-all-trades when it comes to life. Steven loves sports, chess, nature, science, computers, stocks/investing, and just being curious on how everything works. Steven loves helping people and that drives his strong curiosity. Writing articles is a great way to share one’s knowledge. Steven’s hobby is making websites like Scrabble Cheat and Sell sheets

Author: Steven Fox
Article Source: EzineArticles.com

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Do All Highly Prolific Online Article Writers Use Ghost Writers, PLR Or Derivatives?

Back in 2005, there were very few highly prolific online article writers. In fact, one of the top writers for the New York Times who had been working for 40 years at the paper had only written 7500 articles. Most of those have been digitally saved because he is working for a very well-known newspaper that digitized everything. That is an incredible feat over 40 year career no doubt.

Then there are the citizen presses, which also went digital and there are many authors with over 5000 articles. Most of the online article directory sites that were used for article marketing did not even have 2500 articles from any one person in 2005. However, fast forward to 2010 and there are now a couple of authors that have over 20,000 articles. The question is how can one person write 20,000 articles in under five years?

Well, I can’t answer you yet because I only have 19,401 articles, this being 19,402. By January 1, 2010 – I hope to hit the 20,000 article mark, and I am often asked by other online writers if I did indeed write all those articles myself. The answer is yes, and I did not use ghost writers, PLR, software derivative “spinning” programs to do it. However, most of the authors that have over 5000 articles online are using such tricks, strategies, and techniques to produce they are highly prolific content.

Most people have assumed that I must have been using ghostwriters, PLR, derivative, or some other tool to write? After all, it is not “normal” for one human being to write that many articles, some would say it’s impossible. Interestingly enough, they said it was impossible at 5,000 – 8,000 – 10,000 – 15,000 and so on. The individuals, which use all these other tactics, I believe are in a way cheating, but since no one cares, it’s supposedly okay.

Nevertheless, since they are, then I must be like them, or at least this is what people think, however actually putting forth the effort and writing that many articles is a real feat and what others are doing bears no resemblance. So if you ask; “Do All Highly Prolific Online Article Writers Use Ghost Writers, PLR or Derivatives?” the answer is; NO, but most do.

Lance Winslow is a retired Founder of a Nationwide Franchise Chain, and now runs the Online Think Tank.

Author: Lance Winslow
Article Source: EzineArticles.com

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The Debris, Dumping, and Destruction Caused by Derivative Doo Doo Online Articles Discussed

Electronic Publishing Houses for Online Articles have made quite a name for themselves over time. Today, there are 1000s of online article directory websites. Most have been recently over run with recently coined; “Frankenstein Articles” or software generated derivative articles, which are created by spinning articles previously written. For instance, an author steals and article or writes one, then spins the article in 5 or 10 derivative works. So, if he writes 5-10 articles he will have 50-100 articles.

All junk for the most part, but that is a significant quantity. Then they post these articles on the Internet at directory sites specializing in articles. Up until now no one has figured out what to do about it, the solution is simple; delete the members who use this software, but no directory has the balls to do it.

And realize this is the first generations of this software, and someday this type of software may actually produce nice articles, far better than the average human, but we do not live in the future, we live in the present, and the word I am getting is that the major search engines are about to de-list the directory sites with this garbage content.

Now then, at least one major online directory site is taking a stand, and it “appears” that this “electronic-publisher” is going to refuse articles that are PLR content, derivative articles created from software, or re-written content; or articles which are too thin in nature, with no value to the reader, as per their metric [rules] and so those article writers who do not want to play cards by those rules, must go sit at some else’s table.

So, philosophically speaking here is the challenge at hand; There will be those who feel the rules had changed on them mid-game, after they’d already sat down, placed bets, and cards dealt. For those players, one could say that their concerns should be addressed after the current game is over, and prior to playing another hand.

Which seems to be the only hang up with certain players who feel slighted, even though in the end it is still a game under the under the roof of the house (article directory sites that publish these articles), which has been known to throw someone’s butt out for cheating. In old west, they just used a six-shooter. But again, this is not the future or the Wild West past, this is the present in the current paradigm of the digital age.

Stay tuned, the plot thickens.

Lance Winslow is a retired Founder of a Nationwide Franchise Chain, and now runs the Online Think Tank. Lance Winslow believes that he is the only one left who writes his own articles without using such software; http://www.bloggingcontent.net

Note: All of Lance Winslow’s articles are written by him, not by Automated Software, any Computer Program, or Artificially Intelligent Software. None of his articles are outsourced, PLR Content or written by ghost writers. Lance Winslow believes those who use these strategies lack integrity and mislead the reader. Indeed, those who use such cheating tools, crutches, and tricks of the trade may even be breaking the law by misleading the consumer and misrepresenting themselves in online marketing, which he finds completely unacceptable.

Author: Lance Winslow
Article Source: EzineArticles.com

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Actual Embryonic Stem Cells Derived Without Killing the Embryos

When you receive the Seal you will understand the value of human life. Now (Jan 12 2008) human embryo stem cells have been produced from embryos without destroying the embryos.

In the last few months of 2007 there were breakthroughs in producing cells that were very much like human embryo stem cells (hESC) from ordinary skin cells. That was a tremendous breakthrough itself.

But hESC is still considered the “gold standard” for research and is still considered highly valuable and even necessary for research. Now thanks to this new research, it is possible to create hESC without killing embryos.

In 2006 a study showed that hESC could be derived from a single blastomere. A blastomere is the kind of cell created by the embryo in the very first week following fertilization when the embryo begins to divide.

But in that first study in 2006, many cells were taken out of each embryo so that they could not develop anymore. In this study, researchers derived five hESC lines without destroying the embryos, including one without co-culture.

Co-culture is the growth of distinct cell types in a combined culture. This meant that stem cells were needed from other embryos that ended up being destroyed. Co-culture is not a necessary part of this new procedure.

In this procedure, single blastomeres were taken out of the embryos using a process similar to preimplantation genetic diagnosis (PGD.) PGD is a procedure whereby embryos are made free of disease before implantation.

The “biopsied” embryos were further grown until they became blastocysts and then were frozen (instead of killed.) A biopsy is the removal of cells from the embryo, and the blastocyst stage is right after the zygote stage and before the embryo is known as an “embryo.”

The blastomeres were cultured with a technique that was comparable in efficiency to “whole embryo derivations” which destroy the embryos. This is important–the high level of efficiency makes it a viable procedure.

And the derived stem cell lines had the same kind of pluripotency as whole embryo derivations. Pluripotency is the ability of the stem cell to become a cell of any of the three germ layers–ectoderm, mesoderm, and endoderm.

The White House still needs to approve this new technique as a way to get stem cells without destroying the embryos. But this is a major advancement in science–a step forward for the sanctity of life.

This is a solution to the ethical problem of stem-cell research, since embryos can now “share” their life-giving cells with researchers who desperately need them, and still grow up to be healthy adults.

When you are sealed you will begin to understand the sanctity of life. You will understand how God gave Life to people in the beginning and continues to give Life to them.

Of course, the greater kind of life is spiritual Life. The life in this world is a gift from God but the spiritual Life for eternity in Heaven is the ultimate gift and much better than the short and miserable opportunity in this world.

When you are sealed God will give you new life. He will give you a second chance. And He will give you the chance to live forever with Him in Heaven when you receive the Seal.

Come Celebrate the Spirituality of Tea.

Author: Jason Witt
Article Source: EzineArticles.com

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Derivative Lawsuits

When a director or corporation is injured via the actions of the board or an officer of the company, a derivative lawsuit can be brought. A derivative lawsuit is different from other lawsuits in a variety of ways and also provides a different sort of action following a lawsuit.

There are two broad types of lawsuits that shareholders can file when there has been an injury; a direct lawsuit or a derivative lawsuit. A direct lawsuit is a lawsuit that has been brought to redress the harm or harms done to an individual shareholder. In this type, the damages that are recovered are given to the individual shareholder that has filed the lawsuit in the first place, not to the company or the shareholders in general. A derivative lawsuit is different.

Derivative lawsuits, on the other hand, are brought on behalf of the entire corporation for injuries to the entire corporation. When this type of lawsuit occurs, it is generally due to a breach of some prong of fiduciary duties. These lawsuits are brought by directors, sometimes at the behest of the general shareholders, and any damages go to the corporation.

Because derivative lawsuits can only be brought by a director of a company, there are certain procedures that must be followed in order to bring the suit. The model corporate statute that exists, much like the model penal code, requires that if a shareholder wants t derivative lawsuit filed, he or she must send a letter to the board of directors demanding such a thing. The shareholders must then wait for 90 days to find out what the board has determined. If the shareholders are annoyed with the entire board, it is easy to see how the written requirement and board filing rules could impede the shareholders from getting the lawsuit they want.

The Delaware statute does not require a written letter but the lawsuit must still be brought by a director. If the board under the model code refuses to file the suit, the decision of the board will be judged by the same standard of review as any other board decisions, namely loyalty and care.

There is a loophole to the written demand/waiting period requirement included in the model code. If the idea of writing a letter would be seen as “futile” then there is not a requirement to write a letter. Futility is seen as being in place if all or a majority of the directors have an interest in the lawsuit. Having an interest would be “being part of the lawsuit itself” or having to sue the board of which they are a part. Suiting one’s self is seen as having an interest in a lawsuit.

The Minneapolis business lawyers of Skjold Barthel understand the benefits and detriments of both the model code and Minneapolis corporate law for corporations.

Joseph Devine

Author: Joseph Devine
Article Source: EzineArticles.com

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Financial Derivatives And Their Importance In International Financial Management

For some the word “derivative” is synonymous with everything that is wrong with capital markets, trading for trading sake, rampant profiteering, nothing to do with the financial needs of real people. These are a few of the charges ranged against the financial derivative but is that a fair reflection or is there a softer side to this apparently irredeemable beast.

The origins of derivative contracts do indeed begin with meeting the needs of ordinary folks. Farmers in the Mid-west in the mid 1800′s were faced with financial ruin due to severe fluctuations in the price of corn. By the time they had paid for seed corn plus the expense of growing it and harvesting it they faced the probability of having to sell it for a loss. The simple idea of agreeing a fixed price in the future that locked in a guaranteed profit for the farmer was in fact the birth of modern financial markets with the first corn contracts being offered on the Chicago Board of Trade on March 13, 1851. Of course in order to allow the farmers to hedge the price of corn there needed to be someone willing to offer a fixed price in the future – enter the speculator. A simple and obvious fact over-looked by those who wish to denounce market forces is that there can be no hedgers without speculators.

Remarkably, however, more than one hundred years would pass before the concept of a forward hedge would translate from farming needs and commodities trading into the financial markets proper. The International Monetary Market (IMM) offered the world’s first foreign exchange futures contract on 31st December 1974. Once again the emergence of these early derivative contracts arising from a need to stabilize foreign exchange fluctuations as the post world war II international monetary agreement known as Bretton Woods broke down.

As each new layer of abstraction built upon previous layers the world of derivatives trading grew to encompass more and more aspects of the financial markets. For example, futures on interest rates were added to the already existing currency futures and futures on gold with the establishment of futures on U.S. Treasury bills in January 1976.

In the last 30 years the trend has continued with ever increasing complexity. Options on Futures by the early 1980′s, followed by over-the-counter swaps and options in the mid 1980′s and continuing with credit derivatives in the 1990′s and insurance derivatives in the early 2000′s.

What began as a simple means of hedging the price of corn has become a global market that trades trillions of dollars per day. The interactions and correlations between markets that were once considered separate are today closely connected,with price shocks rippling from one market to another. The development of computer systems has been the single most important “enzyme” without which it would simply not have been possible for markets to grow.

Ironically, it is now the inability of computer systems for risk management to keep pace with the markets that is holding back further development. The IT systems landscape within most investment banks is now highly complex with many different systems interacting in ways that are difficult for a human being to understand. Armies of software specialists and consultants maintain fragile systems; “if it ain’t broke don’t fix it” being the mantra of many. But a nest of vipers lies hidden, a tangled web of fragmented and fragile interconnections that means trading firms are vulnerable to substantial losses due to potential system failures. Operational risk within IT systems has the potential to bring about collapse of the entire firm. The time has come for many banks to face up to this problem and tackle it at the grass roots level. Instead of adding more and more patches onto existing systems, radical investment is needed to clean up and bring a structured, well architected systems landscape into being.

cKlear is an IT products and services company specializing in trading and risk management software systems and services.

Author: Priya Sinha
Article Source: EzineArticles.com

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The Advantages of Plant-Derived and Microbial Enzymes Over Animal Enzymes

One may wonder where the enzyme components in supplements are derived. Well, there are actually three major sources of enzymes: plant , animal, and microbial derivatives. But just to provide a little more information they have actually other industrial uses. They are used in tanning leather, processing dairy products, and are present in detergents. Also, enzymes are responsible for turning grape juice into wine.

Majority of all enzymes are hydrolytic in action, meaning they react with water. The plant types are naturally derived from plants. For example Papain, derived from the latex of papaya, and Bromelain, derived from the juice of pineapple.

Animal enzymes are derived from the pancreas, liver, or stomach of animals such as pigs, oxen, and cows. these resemble that of humans and are therefore prescribed by medical doctors for patients with pancreatitis or pancreatic cancer. An example of such prescription is Pancreatin, harvested from the pancreas of pigs.

Microbial enzymes are derived from micro-organisms and are produced through fermentation of these organisms. Microbial include the fungal and bacterial amylases, diastases, and others. Most of these supplements are made from plant and microbial substances. It is primarily because these sources have broader ranges of pH, temperature, and substrate specificities. Not only can they work in the gastrointestinal system of mammals but they are most stable throughout the digestive tract. Meaning, they are safe and can be distributed without prescriptions.

Animal enzymes, on the other hand, need to be enterically coated for it to be able to reach the stomach without losing its potency. Moreover, they have lower range of pH, similar to amylase. Amylase is present in our saliva. It is responsible for the initial break down of food. As we chew our food, amylase begins its work by breaking down carbohydrates present in our foods. For example, when a person chew carbohydrate foods like in the case of eating bread rice, the food tastes sweeter.

There are a variety of that can be derived from plants and from the fermentation of micro organisms, whereas, animal enzymes such as Pancreatin can only offer limited kinds, particularly protease, lipase, and amylase. Plant and microbial offer protease, lipase, amylase, peptidase, glucomaylase, malt diastase, invertase, lactase, cellulase, phytase, alpha-galatocidase, hemicellulase, and pectinase. Suffice it to say, plant and microbial enzymes are not only safe but greatly beneficial.

Another advantage of plant and microbial ones over animal is the production costs. The production of these could prove to be costly since there is little amount of that may be harvested from an animal at a time. Moreover, by the standards of few people, the process of harvesting these and hormones from animal organs and glands is in humane.

Over 20 years of Research has gone into the making of these life-enhancing, pain relieving enzyme supplements. We have potentially created the most powerful Systemic Enzyme, Digestive Enzyme and Heart Enzyme supplements on the market. Learn More Now Go To http://www.TakeBackYourHealth.com

Author: Paul S Fitzgerald
Article Source: EzineArticles.com

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Hedge Funds – Derivatives – Debt – China and the Risk of Systemic Market Panic

It seems that with every significant market swoon, commentators come out of the woodwork on financial television and speak of systemic risk to the financial markets, often from hedge fund or complex derivative blow ups, or events from China. I think there is always the risk, however small, that such an event could occur and cause a meltdown, and we would be foolhardy to say this would never happen.

But really, is there such a catalyst now for a catastrophic market event? I think the catalyst could be either caused by one or more of four factors: a hedge fund (s) seizing up, a derivatives transaction gone seriously awry, the level of our public and private debt, or events from Asia, specifically China.

The first risk factor to the soundness of the financial markets is excessive debt. Sir John Templeton, perhaps the greatest global investor of our time, has said that never before has our financial system been so mired in both public and private debt. Further he has stated that never before has any civilization in history escaped from such levels of debt without dire consequences for its citizens and the society. We will be faced with a lower standard of living for all our people if we do not soon address the budget deficit and reform the level of future Medicare and Social Security obligations.

When Sir John was alive I imagine he was vividly impressed with the catastrophic stock market crash of 1929 and the deflationary unwinding that occurred for more than a decade afterward. He has said that another crash will certainly happen, but that we cannot know what it will strike. Chairman Bernanke, a student of the Great Depression, that era’s moniker, has been reported to believe that the Fed could drop money from helicopters in order to stem off a deflationary spiral such as what happened during the collapse of the 1930’s. (which would be a rather interesting spectacle). A deflationary collapse such as happened in the thirties is possibly the most devastating economic blow that can happen to a society’s economic system.

The second risk factor is the behavior of hedge funds in the market. There are now over 8,000 hedge funds managing hundreds of billions of dollars. Hedge funds provide a valuable service to the market by providing liquidity to the market so the rest of us can reliably execute our trades. But many funds use a great deal of leverage in an attempt to achieve higher returns. The hedge fund Long Term Capital Management, begun by John Meriwether in 1994, a former Salomon Brothers bond trader, achieved wonderful returns in its early years, but ran into trouble in 1998 when the Russian government defaulted on its debt. Returns afterward went negative as a result of the consequences of the default. As the firm was using a high level of leverage, their results were severely impacted. A multi billion dollar bailout of the fund had to be organized to prevent a contagion and collapse in the financial markets.

The third risk factor to the markets is derivatives. Derivatives are investment instruments based on underlying assets such as stocks, bonds, commodities, indexes, interest rates, and so on. The derivative can include put and call options, commodity futures, or interest rate swaps, etc. There are opportunities in these instruments to reap large reward or great loss. There are both publicly traded derivatives and ones traded by private agreement. Warren Buffett was quoted from his March 2003 annual letter about the danger of a miscalculation in complex derivatives transactions. He stated, “we view them as time bombs, both for the parties that deal in them and the financial system.” This statement is taken from [http://www.forbes.com/home_asia/2003/05/09/cx_aw_0509derivatives.html] regarding their opinion of these varied instruments. Both Alan Greenspan and Warren Buffet are concerned that fewer economic institutions are handling derivative transactions, and Buffett has called them “weapons of mass destruction.” Id.

The fourth risk to the financial markets is events from China. The February 2007 Shanghai market swoon shook the confidence of investors worldwide. We do not yet know how this will play out. The record of the last twenty seven years is good. The market has recovered ground lost from sudden market downturns in 1987, 1989, and 1998. The best advice if you want to hunker down is diversification of assets, and to keep enough assets to cover your debt should the unthinkable occur.

I was first exposed to financial markets when I started reading the stock quotes out of the newspaper to my businessman grandfather, who was legally blind, when I was about ten. I remember Papa always told me: “Buy Triple A” (the best stocks). Later, I studied economics at both Vassar College and Columbia University, where I became intrigued by the link between psychology and economic theory.

This article contains the opinions and ideas of its author and is designed to provide useful information to the reader on the subject matter covered. The author may or may not have current positions in the investments mentioned in this work, and the author may from time to time make investments in a manner that is not described here. Past performance is no guarantee or prediction of future results and any investments made, based on the opinions and ideas contained in this work, may or may not be successful. The strategies contained herein may not be suitable for every situation, and the author is not engaged in rendering legal, accounting, investment advisory or other professional services.

My current e-book, A Way to Wealth – the Art of Investing in Common Stocks, is available at my website, http://www.ReiznersWay.com.

Author: John Reizner
Article Source: EzineArticles.com

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