Sunday, September 21, 2008
effect of the end of short sale arbitrage in futures and options
On Friday evening the December S&P futures settled 9 points lower than the S&P 500 index. Fair value is several points higher than the index close. If this discount to fair value persists DURING in the trading day on Monday, I expect we will see the market to start to go into a spiral decline....
as trader mike calls it, financial armageddon is in full effect.