Hello DJ, I just do not know anymore about what I cannot know. Well, not quite anymore, because I didn’t know about it in the first place. Call this state of mind the Rumsfeld Conundrum – not knowing the unknowable.
I am also afraid, but, following on the Rumsfeld Conundrum, I have no clue about what I am afraid of, and yet I allocate my assets into all manner of risky stores of dubiously value, and knowing that some of them will surely explode in my portfolio. Call this circumstance of constant fear and fearless diversification the Jay Contradiction – fearing about unknowable, and doing simply whatever in response.
I am not confused about the way forward. I believe it is intuitively obvious to the most casual of passing observers, yes, even Maurice, that I should listen to the market, as does most on this thread, and do the natural trade. This is the Maurice Paradox, whereby one does not know plenty, fear most of the plenty and plenty more, doing whatever, and yet, paradoxically, not confused about where one is headed for in any case.
Maurice, OTOH, does not suffer from the Rumsfeld Conundrum, is not constrained by the Jay Contradiction, and is fully entangled in the Maurice Paradox, fully allocated between USD and Kiwi cash, and QCOM.
No matter, it is just money we are concerning ourselves with, and we may not have much to be concerned about soon enough:
spacedaily.com
<<Asteroid could hit earth in 2019: scientists
LONDON (AFP) Jul 25, 2002
A potentially devastating asteroid could strike Earth in 2019 … between two and four kilometres in diameter, had a one in 60,000 chance of hitting Earth on February 1, 2019 … urged the government not to ignore the threat ... could wipe out most of the human race is 100 percent>>
Well, this prediction, if know-ably true, would certainly simplify our financial planning, resolve the Rumsfeld Conundrum once, and the spenders would have been proven right all along, for all times, having been borrowing and spending without regard for tomorrow, simply because it then turns out that there is no tomorrow.
Even perhaps better, the Al Quaeda will be no more, and leaving no more unknowns, known or unknown.
That piece of news aside, today is otherwise a grayish day, simply pouring rain, and very quiet because I cannot hear the cicadas sing.
Today is also a simple day made simpler still. The boat trip to Lama Island, the hike across the island, the swim at the deserted beach, the seafood lunch, and subsequent homebound nap on the rocking boat are all cancelled, and leaving only the movie at 6:00pm still on as planned.
On this from Snowshoe, Message 17828519
<<possible Fed rate cut prior to Aug. 13 FOMC meeting ... Salomon Brothers apparently forecasting a 50 bp cut prior to 8/13 while Goldman Sachs … will ease by 75 basis points in Q4.
P.S. I doubled my NEM position on Monday>>
I say the FED, Saloman, Goldman and Snowshoe are experiencing the inexorable forces generated by the above-mentioned Conundrum, Contradiction and Paradox, or “CCP”, namely, doing whatever, in response to the unknowable, in fear, but with full conviction.
All the while, Maurice is saying here, Message 17830451
<<I look all around, and it is not yet time to panic … I suppose you can see the difference between railway operators and the producer of the ASICs which drive the locomotives. Some people [probably most] throw the baby out with the bathwater … [and buy!]>>
I say Maurice is not the slightest bit bothered by the same CCP, which is just as well, because I do subscribe to Elmat’s observation, Message 17830492 , that <<theory of the money being passed around … money bag … metaphora ... to do things the people who control capital inflows and outflows need ... for the movement sake ... Because the money, to be made, is in the movement itself NOT in what it is done with the money>>,
… and so Maurice’s dough must be cycled to those who want it, since he doesn’t want it himself.
On the matter of the old lady that I spoke of here,
Message 17826614
… and others responded to, eventually building up a consensus, between Elmat and CB, that she should spend her money …
siliconinvestor.com
<<… the old lady probably will not spend $500K USD in her lifetime … Hard for me to wrap my mind around forex shifts. Seems to my poor brain that 5.27% in US dollars would be even better now that the dollar is down, and heading lower.
If the Fed cuts interest rates, she may not see that rate of return in her lifetime.
I am contemplating, blissfully, 5.5% mortgage rates, even 5%, maybe even 4.5%.
War with Iraq would mess all that up, though.
I wonder why such a hard-working savvy woman isn't buying gold?;^)>>,
I first add to the unknowable of the Old Lady Puzzle, from my observation and intuitive reserve:
(a) the old lady was frail, cleanly but simply dressed, insisted on renewing her CD in person (as opposed to auto renewal), sports a mass-market gold Rolex watch;
(b) probably cannot spend much even if she wanted to, though tries to exercise by walking around;
(c) has other resources because she was locking her money up in one single fixed time deposit for three months; and
(d) if I were to guess, I would say she has plenty of gold already, probably in the same wrap account in paper form, and somewhere in her residence, in physical form.
I must add also that the bank staff was patient and proper, in that she did not try to sell her any funky structured ‘guaranteed’ products that they keep trying to sell me, and simply rolled her funds over to another fixed timed deposit.
On CB’s pondering, I respond 5.x% interest rate on 30-year T-bill is too stingy, because as the USD gurgles down for all the right reasons, the market rate will rise, and with long bond, catastrophic mark-to-market capital loss will occur, destructively affecting the balance sheet even as the income is not touched.
The current recession is mostly about the destruction of balance sheet, and secondarily about the pulverization of the income statement, of the global, national, regional, municipal, corporate and personal economies.
The whole construct of the economy at all levels is made up of two parts, a balance sheet reservoir, and a current income pipeline. The reservoir is drying up, and so the pipeline is on dribble-feed; BTW, when inspected, we will also find that the dam is cracked, and the pipes are constricted, not ready for the coming rain, even as the houses built around the reservoir are about to crumple in because the perimeter of the reservoir is no longer held in place by liquid pressure.
Simply put, we have quite a mess, ala Japan, but without the liquid, and so more like Argentina, only more massive.
Chugs, Jay
P.S. I forgot to ponder about the details of the 'natural trade'. Any ideas? |
