(FINANCE) the situation in which a derivatives trader with a short position is wrong about the behavior of the market. Having sold shares of stock he doesn't own, he is now compelled to buy them at a higher price than he sold them for (in order to reimburse whomever he borrowed the shares from).
If the short position was taken by writing naked options (i.e., issuing call options of stock the trader doesn't happen to have), then the trader has to buy shares of underlying stock in order to honor the options.
It's extremely expensive for traders to have to cover their shorts.
If the short position was taken by writing naked options (i.e., issuing call options of stock the trader doesn't happen to have), then the trader has to buy shares of underlying stock in order to honor the options.
It's extremely expensive for traders to have to cover their shorts.
The surprising stock rally came as a shock. Nicholas Leeson had been riding high, but now he was furiously covering shorts, and driving the share prices higher still. By closing bell, he was ruined.
by Abu Yahya May 05, 2010
In economics, (1) Materials or equipment used to produce goods (e.g., tools, parts, inventory, buildings, fixtures, hours of training); or (2) money that is used in a business venture. Capital is created by saving, rather than consuming, economic output. Over time, saving accumulates into capital; it also depreciates.
by abu yahya August 04, 2008
(FINANCE) when a trader in a short position is wrong about the price movement, and is consequently forced to buy the asset at the higher price in order to meet legal obligations.
The classic example of this is the broker who sells stocks he does not own, in the expectation that he can buy the stock in the future at a lower price for delivery. If the price goes up instead of down, the broker must "cover his shorts," and very possibly drive prices higher still.
The classic example of this is the broker who sells stocks he does not own, in the expectation that he can buy the stock in the future at a lower price for delivery. If the price goes up instead of down, the broker must "cover his shorts," and very possibly drive prices higher still.
When Morgan was ready to squeeze the shorts, he was damn certain his corner would hold as the Twombly men scrambled to buy shares at any price.
"I've got your short cover right here, Gentlemen," he snorted from his seat overlooking the trading pit.
"I've got your short cover right here, Gentlemen," he snorted from his seat overlooking the trading pit.
by Abu Yahya April 15, 2010
(FINANCE) a stock whose price movements determine the value of a financial derivative. For example, when a hedge fund manager writes a call option for Citigroup (NYSE:C) at 4.25/share, C is the underlying stock.
"Underlying" can be used to refer to other things besides stocks; for example, commodities, currencies, or bonds.
"Underlying" can be used to refer to other things besides stocks; for example, commodities, currencies, or bonds.
by Abu Yahya April 05, 2010
*noun*; a subdivision of economics that focuses on addressing recessions by stimulating supply, rather than demand. During a recession, supply siders recommend cutting taxes rather than increasing government spending.
"Supply side" is in contrast to traditional practitioners of Keynesianism, "demand siders" who believe the main fiscal policy tool for recessions should be increased government spending.
Both supply siders and demand siders believe the government is responsible for formulating effective fiscal policy during recessions.
The most famous advocate of supply side economics was Arthur Laffer.
"Supply side" is in contrast to traditional practitioners of Keynesianism, "demand siders" who believe the main fiscal policy tool for recessions should be increased government spending.
Both supply siders and demand siders believe the government is responsible for formulating effective fiscal policy during recessions.
The most famous advocate of supply side economics was Arthur Laffer.
When Ronald Reagan ...promised to cut taxes ...he claimed tax revenue would go up, not down... as the economy boomed in response to lower rates. Since then, supply side economics ... has become a central tenet of Republican political and economic thinking in the country.
"McCain sticks to Supply Side Economics..." *International Herald Tribune* (24 March 2008)
by Abu Yahya March 06, 2009
German, *noun*: "foundation"; a type of business organization dating from the late 19th century in which one or more companies are owned by a foundation. The foundation, in turn, is governed not by shareholders, but by whomever is chartered as a stakeholder in the firm, such as workers, financial planners, local residents of the town where the firm operates, and so on.
The biggest company owned by a foundation is Robert Bosch GmBH, which is 92% owned by Robert Bosch Stiftung (Stuttgart, Germany). Bertelsmann AG (Guetersloh, Germany) is owned by the Bertelsmann-Stiftung, which appears to possess the largest endowment of any German foundation; the affiliated company owns an enormous media empire.
Plural: Stiftungen
The biggest company owned by a foundation is Robert Bosch GmBH, which is 92% owned by Robert Bosch Stiftung (Stuttgart, Germany). Bertelsmann AG (Guetersloh, Germany) is owned by the Bertelsmann-Stiftung, which appears to possess the largest endowment of any German foundation; the affiliated company owns an enormous media empire.
Plural: Stiftungen
The prevalence of the *Stiftung* in German industry probably contributed to the excellence of German manufactures, since the affiliated companies were managed by engineers.
by Abu Yahya February 23, 2009
The phenomenon of people condemning vices they have indulged in themselves already, and since given up. Inspired by the _Confessions_ of Augustine (417 CE), in which Augustine describes his career path and then denouces the things he did to get to where he is.
WHY IT'S BAD
With SAS, the perpetrator has received the BENEFITS of a particular vice. It could consist of sleeping one's way to the top, or lying a lot, or getting divorced, or indulging a vice until it gets tiresome. At that point the perpetrator makes a big display out of quitting the vice and condemning it publicly. It's like climbing a ladder out of a ditch and then pulling the ladder up so others can't get out of the ditch; and to add insult to injury, the perpetrator ridicules the desire to use the ladder.
Like other forms of hypocrisy, it's destructive because it enforces stupid social codes. If the social codes were right all along, then the perpetrator should not get off the hook for violating them, but, in effect, he gets praise for having done so (and having "kicked the habit"). If the codes were wrong, then they should be confronted . And finally, it's bad because it creates a meritocracy of bullshit.
WHY IT'S BAD
With SAS, the perpetrator has received the BENEFITS of a particular vice. It could consist of sleeping one's way to the top, or lying a lot, or getting divorced, or indulging a vice until it gets tiresome. At that point the perpetrator makes a big display out of quitting the vice and condemning it publicly. It's like climbing a ladder out of a ditch and then pulling the ladder up so others can't get out of the ditch; and to add insult to injury, the perpetrator ridicules the desire to use the ladder.
Like other forms of hypocrisy, it's destructive because it enforces stupid social codes. If the social codes were right all along, then the perpetrator should not get off the hook for violating them, but, in effect, he gets praise for having done so (and having "kicked the habit"). If the codes were wrong, then they should be confronted . And finally, it's bad because it creates a meritocracy of bullshit.
A good example of St Augustine's Syndrome is Doctor Laura Schlessinger, the evangelical talk radio host who climbed her way to the top, divorced, and then renounced feminism. Many putative sages are famous for having had, earlier in their lives, immense amounts of sex with numerous partners, only to renounce the ways of the flesh and denounced materialistic society.
by Abu Yahya March 21, 2010