Australia has gone two decades without a serious downturn, leading most to believe that house prices move in only one direction, despite historical data which clearly indicate that the ratio of home prices to income has always fluctuated around a stagnant long term average.

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As it happens, the Basel gurus are introducing a 33-to-1 gross leverage ratio - which many would see as a step in the right direction, but British MPs and lords on the standards commission think is too high.

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Ratio backspreads are great options strategies to employ when you want to bet on a direction for the underlying stock, but are unsure if your direction is correct.

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They have been headed in that direction for several years--in 2006, digital sets will outsell analog sets at a ratio by a two-to-one ratio, the Consumer Electronics Association estimates--but the new law will accelerate that trend.

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Clearly this was not a favorable risk reward ratio unless there was data to show better than 70% probability of the move in the direction chosen by an investor.

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