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Kim Zussman
3/15/2005
Kim Zussman on The Meaning of Low VIX
It seems the "this time is different" meme is still with us.
Recall knowing admonitions that minuscule (and yes even negative) E/P were warranted by the new era of the internet, and even Sir Alan allowing for a new paradigm?
Today's WSJ (C4) carries another article cautiously claiming that low VIX is warranted in part by the action of so many hedge funds and increasingly plentiful derivatives now available to disperse risk. In other words, the frenzied actions of putative profiteers of Wall street have made the world a safer place for your money.
Perhaps it is time once again for the chorus of finance, who slew inflation, business cycles, and stock or real-estate bubbles, to sing the funerary requiem volatae prehistoricus.
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