Weekend Update

It's really amazing that this past week marked the single worst one of 2012.

With now nearly 25% of the year having passed, we can look back and say that a 0.5% drop is the largest we have had. Hard to believe, given where we had come from.

Reminds me of the comment a neighbor made when we bought our new long haired miniature dachshund home for the first time.

"I have poops that are bigger than that thing."

That's what I imagine 2011 saying to 2012.

You call that volatility? I'll show you volatility.

The two big stories of the week were undoubtedly the debacles surrounding the IPO of the BATS Exchange and plunge in Credit Suisse's leveraged VIX product, TVIX.

In the case of the TVIX Exchange Traded Note, there is nothing but misunderstanding regarding pricing and the risk. The details regarding the general misperceptions around TVIX is really well adressed by Kid Dynamite, who is part of the StockTwits family of bloggers, that includes The Reformed Broker and James Altucher.

Not a bad bunch, despite the fact that Phil Pearlman, one of the founders of Stock Twits hasn't added me as a blogger.

Tell Phil.

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Now What?

Like most people who have a vested interest in life, I woke up this morning to the apparent good news that some kind of an agreement had been reached on the Greek crisis.

Most other natural laws were not being violated, according to the early morning news, but this was a real shock to the sytem of universal truths that we count on to make it from day to day. Otherwise, we'd all be stuck to the ceiling.

You'd be more inclined to believe that had Newton discovered the parachute before the Law of Gravity, things would be very different today for all of us.

Reportedly bond holders of Greek debt will take a 50% haircut. I still don't completely understand what that means, especially since I've always been a bit mystified by the world of bonds and currencies. (See: I Don't Understand Currencies)

Britain, which is putting up nothing in the bailout, simply called the EU's key players "morons", offered their advice and went back home. Much like Geithner did last month, except without the bangers and mash awaiting him at the airport.

That I understand.

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