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The Stock Market Roller Coaster
Fred, I hire a computer guy, an hourly guy to manage my systems. I don't know too much about computers, nor do I need to. I pay people to do that kind of stuff. And Fred, although I don't really know how the economy works, I do know how markets work, and furthermore I understand all the economic philosophies from Hammurabi all the way through Marx and Krugman. Anyways, your cognitive dissonance was clearly exhibited when you visited my blog and had a cute little retort. Furthermore, I'll admit that I'm mistaken about you....you're a writer and hack, sorry about my confusion...a profession far more useless than what you accuse mine to be. The world can live without what you write, but the world cannot live without what I trade. However, it's obvious that you need a victory in life so I will let you have the last word.— January 3, 2012 7:41 a.m.
The Stock Market Roller Coaster
Fred, you are really clueless and your lack of knowledge is apparent in this logically false statement you made. "I have zero objection to a skilled craftsman, writer, programmer, builder, or other creative person using their superior skills and knowledge to better themselves." There, that's my cut and paste. You've commented on my site....and realize that it's not cut and paste. At least I will give you credit for using a proxy server when you visited so you still have your anonymity. Surfpuppy wasn't so smart. Anyways, I have run into jealous people like you(lots of programmers are that way for some inexplicable reason) all my life and the comments and invective don't bother me.— January 3, 2012 6:01 a.m.
The Stock Market Roller Coaster
Absolutely, but the cost of the vig more than compensates for inside knowledge over the long run.— January 3, 2012 5:49 a.m.
The Stock Market Roller Coaster
The only time I ever bet sports is when someone wants to get a bet down and I charge them vig and usually lay it off with a bookie.— January 2, 2012 5:01 p.m.
The Stock Market Roller Coaster
As it should be in both casinos.— January 1, 2012 12:10 p.m.
The Stock Market Roller Coaster
When I'm trading in the market, I do best when I am playing the role of the house. The vig can add up over time.— December 31, 2011 11:54 a.m.
The Stock Market Roller Coaster
Actually, a lot of traders also play the ponies, bet on sports, play poker etc. However, in most of those games, with the exception of poker, there's a built in negative eV. It's all about the risk and the thrill of risk. Among the professional trading community, the trading is usually +eV, and most good, professional traders can quantify their eV pretty accurately. In my case, I know that for every contract of wheat I trade, I can expect a usual profit of three quarters of a cent(this includes losses. This percentage changes for each different market cycle. Some high frequency traders I know have their algorithms tuned to spit out a profit of $.10/100 shares, some at $.1125/100 shares and on and on. They are pretty spot on with their quantifications and the results are pretty close to the predictions.— December 31, 2011 8:07 a.m.
The Stock Market Roller Coaster
I would contend that for the general public, that anything they do in the market is a gamble, not just short selling. Short selling is just another tool in one's belt to extract money from the market. However the general public generally is long, and shorting is not something they do and it would be gambling for them to short. In fact, one of the most accurate indicators back in the 1950's-1980's was the odd lot short sales number from the NYSE. Your statement that if the recession/depression worsens that treasuries would be the best bet is only true if it is a 1929-1940 style depression where treasuries remained steady while equities lost 90%. Treasuries would be a very bad bet if we had an 1874 style depression, or if we had a Weimar style collapse/hyperinflation/depression (1921-1922). Furthermore, if the current debasement of the dollar continues, one might look at commodities which didn't hold up in 1929-1940, but performed very nicely in 1874 and were really the only thing to own(if one had no access to foreign currencies) during the Weimar collapse.— December 29, 2011 12:29 p.m.
The Stock Market Roller Coaster
Curious on your methodology of arriving at the 25% recession combined with violence. Is it formulaic, an opinion from someone else you that fits your worldview, a guess, or some other proprietary system? Just price action, the yield curve, depreciation, government debt, debasement, the slowing velocity of money, and a few other variables cause me to arrive at a much higher figure, somewhere in the 50% within 5 years. Utilities make sense for now, but one can look at the 1930's action of utilities for guidance. Interesting observation....I was in Comcast today getting a new digital box and noticed people turning in their boxes and slimming down on the cable. The clerk told me that nobody can afford premium cable anymore. Surprising because Comcast is way off it's 2009 low of 11.63.— December 28, 2011 3:59 p.m.
The Stock Market Roller Coaster
I don't know if the stock market is overpriced or not. The price action suggests it's not. If the S&P holds 1221, there is a 85% chance that the market will have a strong move upside. Pundits like Alan Abelson (http://topics.barrons.com/person/A/alan-abelson/6…) have been bearish ever since the Dow was at 800. Hell of a big move to miss. Cash isn't overpriced, it's dirt cheap right now. The prime rate is 3.25% and the overnight is 0.25% which suggests that my contention is correct....I know there's lots of money out there and my clearing firm is trying to shove it down my throat.— December 27, 2011 6:16 p.m.