Billions in Put Options purchased betting that the market will crash (UPDATE: CALL MADE?)

reply to post by ClintK


SPX: S&P 500 index
700 = the strike price of the puts

I need some insight from someone who knows more about this than I. If the banks have counterfeited, say $100, and loaned it out. The loan went bad and that $100 disappeared. Then the government comes in and prints money to replace it. So the money supply went from (x + $100) to (0), to (x + $100). The public no longer is occupieing the banks real estate, and now the government owns it. Sure, the debtors got screwed by being so in debt, the banks got screwed when they engaged in counterfeiting, and a few profit by getting work with the expanding bureaucracy. But what other economic effects will this have on others who use greenbacks? I am on government subsistence, and it is increased every 12 months to account for the governments fictitious inflation numbers. So if the money I get drops in value by, say half, until it is increased a few percent, I get screwed royally. But what would cause the inflation? The government only is printing what just disappeared from the counterfeit put out by the banks.
On a side, that new money that was issued with the invisible pics and new design? Why? Because China was counterfeiting in order to buy nukes from Russia, telling the Chinese people that they will hit us with them, payed for out of our own pockets. The bills were changed in an attempt to thwart the counterfeiting. But it is irrelavent. They can print the new way, as well, and are. At least the banks don't have to print it, they just write it into the borrowers account.

Originally posted by Gregarious
I need some insight from someone who knows more about this than I. If the banks have counterfeited, say $100, and loaned it out. The loan went bad and that $100 disappeared. Then the government comes in and prints money to replace it. So the money supply went from (x + $100) to (0), to (x + $100). The public no longer is occupieing the banks real estate, and now the government owns it. Sure, the debtors got screwed by being so in debt, the banks got screwed when they engaged in counterfeiting, and a few profit by getting work with the expanding bureaucracy. But what other economic effects will this have on others who use greenbacks? I am on government subsistence, and it is increased every 12 months to account for the governments fictitious inflation numbers. So if the money I get drops in value by, say half, until it is increased a few percent, I get screwed royally. But what would cause the inflation? The government only is printing what just disappeared from the counterfeit put out by the banks.
On a side, that new money that was issued with the invisible pics and new design? Why? Because China was counterfeiting in order to buy nukes from Russia, telling the Chinese people that they will hit us with them, payed for out of our own pockets. The bills were changed in an attempt to thwart the counterfeiting. But it is irrelavent. They can print the new way, as well, and are. At least the banks don't have to print it, they just write it into the borrowers account.

Bank lending is not "counterfeiting", it is measured in the M1 money supply. Theoretically this money was blown on assets and now we have go though "reflation" to stop the "deflation" of asset values, but in the next 2-3 years it will cause inflation. You are "reflating" financial assets, while commodities become both more scarce and the purchasing power of the dollar falls, causing an inflationary problem. Luckily the Fed is kind of taming an inflationary spiral by now cutting rates too low...2% is low, but they could cut it to 0%.

[edit on 20-9-2008 by yellowcard]

reply to post by yellowcard


I'm sorry, I still don't get it. The banks are loaning out money that does not exist, until they loan it out. How is that not counterfeiting? Soley because they do not have the added cost of actually printing the money they are creating? Or maybe just because that is a 'politically correct' way of counterfeiting, and noone likes to call a rose, a rose? A rose, by any other name, is still a rose.

reply to post by Gregarious


As long as they maintain a reserve requirement around 1/9 of the money they lend out, they are protected by the federal reserve in the case of a bank run or whatever.

It's legalized Fraud. The 'investment banks' got the OK to go 40:1 a few years back and you see where it got them.

Go try to loan someone 9 times the amount you have in your checking account so you can charge interest and see what happens to you. The Gov and Bankers have had an 'agreement' since 1913. The Bankers get to steal you blind and the Politicians get all the money they need for Wars and Reelection. Completely Unconstitutional.

If put options are so easily traceable, why was not the identity of the airline putters made public after 911?

Interesting revival of this thread. The original rumors turned out to be just about a year ahead of the real crash. It’s also curious how closely the market ups and downs have paralleled ‘29. If they continue to, there will be one more big dip.

reply to post by netscape
I just ran across your post today, and I can tell you to invest half in top notch collectible gold coins, or even silver. The other half in inverse ETFs, maybe DIG, then when it starts to drop, change to DUG.