Crisis Rollover

On the last Thursday of every month, the analyst appears on the television discussing the rollover in the derivatives market. Rollover is a term used to describe the closing of a derivative position for one month and opening it for the next month. Its rather strange that we have been rolling over one crisis after another, without much to cheer, for the last 18 months. Here is a quick recap of events.

• April 2007 - World wakes up to the concept of subprime mortgages and its implications.
• June 2007 - S&P downgrades over a 100 bonds.
• Aug 2007 - Large banks halt redemption's for a few fund offers.
• September 2007 - Central banks increase liquidity by reducing interest rates.
• October 2007 - U.S. Treasury announces the HOPE NOW initiative, an alliance of investors, mortgage market participants.
  
• December 2007 - U.S announces the Troubled Asset Relief Programme
  
• January 2008 - Stock markets across the world start collapsing.
  
• March 2008 - Bear Stearns is acquired by JP Morgan Chase in a distress sale
  
• September 2008 - Lehmann Brothers collapses.
• October 2008 - There is total freeze in the credit markets.
• November 2008 - The U.S. Treasury purchases a total of $125 billion in preferred stocks in nine U.S. banks.
• December 2008 - The U.S. Treasury authorizes loans of up to $13.4 billion for General Motors and $4.0 billion for Chrysler to bail them out.
• March 2009 - Stock markets bottom out and reach the point of despair.
• April 2009 - Swine flu scare grips the world.
• June 2009 - India receives deficient rainfall and the threat of drought looms large.

Its been a tumultuous few months for everyone. In this typhoon the small fry have been really badly hit. It seems to me, and I say this without data, that the tide is turning. The news cycle will move towards positive and so will the rollover.