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Then, governments or bankers come to rescue and comfort people. It is basically emotional addiction... Basic emotions that we are all taught by our mothers when we are just few months old. And we cant stand it if alone. We need a hug. Really...
The just completed auction of $16 billion in 30 Year bonds, was, as Rick Santelli said, "a failure". And while this may be a little dramatic, this was without doubt one of the ugliest 30 Year auctions ever seen. The 30 year priced at 3.75%, a huge 11 bps tail to the When Issued which was trading at 3.64%, the Bid To Cover plunging from 2.80 to 2.05, the lowest since February 2009, and, most shockingly, the Indirect Bidders Imploded to a paltry 12.2%! Those wondering if Chinese posturing would led to anything more than just jawboning have their answer. The Indirect tendered bids were just $3 billion or about 20% of the total auction size, which resulted in a $2 billion take down. It was so bad that the Directs were for the first time in 30 Year history greater than the Indirects.
The 30 year priced at 3.75%, a huge 11 bps tail to the When Issued which was trading at 3.64%, the Bid To Cover plunging from 2.80 to 2.05, the lowest since February 2009,
France, Italy, Spain and Belgium have banned short-selling of the shares of banks and other financial companies.
Societe Generale has been the worst affected by the volatility, being forced on Wednesday to deny that its financial stability was at risk.
Short-selling is when traders profit from bets on the fall in a share price.
It has been blamed for increasing recent market instability.
Short-sellers usually borrow shares or bonds, sell them, then buy them back when the stock falls - pocketing the difference.
"Naked" short-selling is when a trader sells financial instruments he has not yet borrowed.
All forms of short-selling are included in the ban.
Mr Oudea also spoke to France Info radio. "People are scared," he said, "so the tiniest information touches off irrational fears. To our clients, we have to tell them that these rumours are baseless and that they can have confidence in Societe Generale."
Originally posted by DangerDeath
Short-selling is bad.