Hi ACF Mike, It was Friday morning, and I started this post before take-off from Wuhan to HK. The Compaq PDA is great for putting thunk (sp?) to words, at any place and most times.
I am readying for the traditional Saturday morning diary entry and bull-taunting, an endlessly amusing past time, until it passes, bullishness ends, and we are ready to hoof away, horns sharp (run on sentence, and too many phrases?).
The amusement will likely continue for a few years, or perhaps a dozen quarters, until the Japan script with variation plays out.
Speaking of amusement, (passive voice?) Secretary O'Neill is reported by Business Week to have said, "I do not believe that our system is broken. We have the lowest capital cost of any place in the world, because we have demonstrated that investors' money is safe here". The man is brilliant, but wrong.
By the O'Neill benchmark, Japan has done an outstandingly better job in showing the world how safe their savings are, and deserving no more than 0% interest rate.
Yes, I know, interest is only one component of capital cost, and only the Nasdaq has fallen by the same magnitude as the Nikkei, leaving the implied capital cost of NYSE intact.
Give it time, and make room for wide area splatter space on the sidewalk, for the Old Ec NYSE is levitated on J6P and his home equity power, in turn supported by J6P consumption induced foreign capital fuel. New Ec is not actually new, just the same old leverage magic roller coaster ride, peaking, and soon to be expending gravitational potential energy in uncontrolled descent, without gears (repetitive variation of a tired idea?).
The Japanese retail savers are now buying gold by the kilograms. Nuf said on that taunting topic.
I remain hopeful that comedian O'Neill was just practicing on his act and not actually formulating policy based on his "don't believe".
I am hoping the comedian is actually a professional financial engineer, either able to rescue all through some derivative abracadabra or through honest work, post collapse.
Then again, I am also (negative optimism?) hopeful that Congress will fix the not broken accounting and audit system that facilitated the S&L crisis of 1989. That is, fix the truly 'not yet broken' leverage-enhancing gears, trains, pulleys, and chains that has been astoundingly successful in generating so much yet-to-go-bad capital for a largely unproductive asset class which should not never have been treated by J6P as savings, tax advantages excepted, but just that.
Watch your steps Jay, for you are treading on sacred home equity grounds. These are the same grounds citizen Greenspudkaput (hostility alert?), on behalf of Uncle Tom, had enthusiastically endorsed for further leverage by cousins Freddie and Fanny (lack of objective data alert?). This is the same piece of grass where J6P hopes to salt away the retirement eggs now that the equity cult can no longer be counted on to incubate the 401ks, whether or not Uncle Tom can create more fiat paper to rescue the indices by way of privatizing an asset-less Social Security faith.
Uncle Tom's plan is clear enough: maintain faith at all cost, obscure clarity at the same cost, twice leverage, and flood the patient with whatever liquid that is handy, via the borrowed twin catheters of trade and fiscal deficits, until the next election. After that, hope for the best, do not cry for Argentina, while remembering to scream at Japan yet again, one more time, to encourage perhaps higher Japanese negative interest rate by reissuing coupons allowing the purchase of young girls used panties out of vending machines, but not tobacco from shops, as the former is healthy, and the latter not as much.
Yes, Jay, take it easy on Uncle Tom, citizen Greensputinkaboom, and the dear F cousins, for they mean to save the J6P at the cost of S2B (Sake 2 Bottles), W3C (Wang 3 Cups), and H4P (Hans 4 pitchers). They have not figured out that the foreigner always suffer less than the locals, on absolute and relative basis, and the foreigners do not vote, other than by casting their money, far away from harms way.
So, Ok, I admit knowing what the game is does not make the playing any easier, only possible.
The objective of the game is to keep what one has, and get more by the mistake of others, or the brilliance of self.
Maurice was right. The negative satisfaction of losing less is no satisfaction at all, unless one's mind works in peculiarly negative and un-bullish ways.
Since I know I am not brilliant, I therefore cannot count on what I do not have to get more of what others have.
I can only then count on others making mistakes. This is an initially very passive stance.
On the matter of mistakes, I am not disappointed so far on those made by others in this long game, and I have made a few.
My gaming is simpler than Greenspankie's, involving nothing more than active and diligent work, persistent and metallic savings, attentive and wide angle watching, and patient waiting. The waiting is stressful but, to repeat, amusing.
It was now Friday afternoon. I am waiting for my personal ex-Marcos crony, a HK based HBS educated accountant, to start a powwow of desperate investors looking to place some money with a sliver of hope for positive returns.
The scheme is something about buying up a bouquet of ground floor level shops around a large HK city block destined for a major development by another of his bigwig client.
I actually do not need to hear the dog & pony show; my mind is made up to participate, and say, count on quintupling, instead of the promised 10 folding. Holding period is 6 years.
The syndicate will be leveraging 1:1, and if I leverage the entirety of my 'equity' contribution on Yen (Or Pesos?), returns would be infinite.
All or Nothing.
The crustaceans are starting to stir.
Chugs, Jay :0) |
