Hi Thread, I am still in Hangzhou. I do not know whether shorting the market is unpatriotic or not, because to me, finance and nationalism are completely separate matters. I am French Creole Trinidadian Hakka Chinese living in Hong Kong, with Jewish half-siblings residing in Russia and China, and I married to a Chinese born in HK, citizen of Canada, raised in New York, originating from parents who are Indonesian Chinese, and in matters of nationalism, I feel very alone, a kingdom of one. On issues of ethnic kingship, I am at times alone as well.
I do however agree that shorting this market is unwise.
The thesis of the CFC2001 was, as far as I was concerned, that a unique period has fostered a general and pervasive weakening of the overarching financial and underlying systems that valued all fungible assets highly, leaving the systems vulnerable to a trend reversal, a reversion to the mean, at a time when all the participants in the system is least able to cope with such a reversals.
We on this thread had talked about missiles, satellites, Echelon, big bombs in small containers, fanatical religions, and civilization. We now know we were not OT. We were spot on. Once again, I remind myself, “I lack imagination”.
The reversals to the mean, in the big picture, is tolerable, and on the micro scale, is preferably circum-navigated if possible, either by the policy makers making the right choices, or by individuals avoiding the epicenter of the greatest stress, namely, the equity markets, and more specifically, the US equity markets.
Now, an extraordinarily tragic and inhuman outrage has been perpetrated against human civilization, and all that holds civilization together, which is not so much finance as much as it is confidence. I believe the politicians all across the world has an unique opportunity, and Bush a unique forum, to start putting the pieces of the new world order together. All the countries suffer economic maladjustment to varying degrees, and the solutions all point to (a) purging of toxic residual in the financial system, (b) transfuse new blood, and (c) not making the same old mistakes again. In financial and economic terms, we are simply talking about vast amounts of write-offs, followed by brand spanking new money, and in political terms, a promise that all is not as it was, followed by visible progress towards a multi-lateral, universal consensus sustained implementation for this new world order.
If the politicians can visualize such an order, has the aptitude to map out the way to such a new state of affairs, and has the eloquence to convince the financial market that all is possible, the world will then be different and, accordingly, behave differently. The market, as a beast that always looks to the future, will in fact go way up.
Should the politicians dawdle and, worse, lock on to policies that clearly cannot work, the market will tank.
The most likely outcome by my figuring is that we will march right down the middle of the two alternative forks in the road, leaving the market gyrate in one hopeful direction, then another disappointed bearing, leaving no trend-following opportunistic traders safe from extreme danger, and keeping the counter-trend traders in a state of constant panic.
Chugs, Jay
P.s. If the US market opens down anything larger than 5%, I will be a buyer of the large financials and techs, trade out upon recovery. If the US market opens up (very possible), and gold shares go down (also possible), then I will sell puts on NEM once again. Should HK continue to break down today, I will buy HSBC and more PRC oil shares. In Japan, I am again eyeing 5801 (Furukawa). And I have no idea what I am doing in this uncharted territory, simply feeling the stones while crossing a murky river on bare feet. |
