Hello Anna, <<… your international economic and political analysis are of the highest quality and the way you are applying them to investment decisions is simply brilliant>>
…. I blush and this can be the start of a beautiful friendship :0)
<<Your entire post and this point in particular really chilled me …>>
I was trying to chill self from smug complacency into jarring action, much as I would on an on-line Unreal Tournament unrealtournament2003.com Last Man Standing Death Match games.softpedia.com whenever the arena seems unusually quiet and all other combatants seemingly have melted into the decorations. I succeeded and now I am scared, but with glee for potential loot ;0)
<<How likely (% wise) do you think this horrific possibility may come to pass?>>
I fired up my portfolio software (MS Money and custom Excel programs) and returned the exchange rates back to the January 1st, 2003 levels without fiddling with the gold price, and my NAV gain to-date was trimmed back by 65% as a consequence, which means my NAV would be reduced by 11% from today’s level, to which I say, ‘Ouch!’ and then, ‘hmm, an opportunity?’.
On the one hand, my base currency is USD/HKD and a switch back into the base does not entail untoward risk in any mathematical sense, but may necessitate me to go counter to psychology if the feared USD counter-trend rally fails to materialize and requiring me to buy back my non-USD positions at a higher high. I do not like this prospect.
OTOH, I could just go to the bank and buy a six-month USD call to cover 10-20% of NAV at a possible cost of ranging between 0.02-0.04% of NAV and simply live with this position until expiration, or claim prize when appropriate and turn around to buy a New Taiwan Dollar call ;0)
I am predisposed (for ACF Mike, I mean ‘I prefer’, and for Maurice, I mean 'I like' :0) to wager on the second approach, because the primary secular trend is probably still for a substantially lower USD, and the second approach is more geometrically pleasing, simpler, involving less effort, and therefore the more elegant of the ways :0)
I will check the second approach first thing tomorrow. There is simply no respite for the greedy.
<<P.S.: That villa in Tuscany you sent me a picture of? Is a dream of mine>>
… not Tuscany, but Umbria achamchen.com :0)
If you did not already watch “Under the Tuscan Sun”, do, it is a movie that can be watched 5 times in as many months.
Chugs, Jay |
