OT RtS,
That's a most reasonable request. If there were not important and relevant investment implications, I would not be bringing this topic up. Let me recount my thought process, which is as yet incomplete, but reflected in my ongoing investment process.
I have been very concerned about the market since this quarter's excellent earnings were trashed by the market. Conventional wisdom was summed up by Sarmad, when he told me that it's just a reflection of concern about rising interest rates. I replied that while I shared such concerns, I feared the earliness and extent of the reaction implied there was another factor at work - a disquieting concern about geopolitical events that seems to be eroding the desire of people to hold risky assets. Now I am simply fleshing out my thesis a bit further and surmising that if Friedman's observation is accurate, and it seems to be corroborated in recent Pew public opinion polls, then it would only seem logical for such feelings to be reflected in the marginal propensity of foreigners to hold American assets.
Last week the selling became so extreme at one point that Gottfried quoted a columnist who said that it appeared that a major fund was being liquidated. We still don't know who is selling or why, but I think it is reasonable for us to try to figure out what is going on. I had a terrible dream last night about the holocost and I woke up wondering what a fund manager like Soros must be doing with his assets these days. To paraphrase the great economist and investor Keynes again, we as investors are like judges in a beauty contest. But we do not have the luxury of choosing who we think is the prettiest girl. Instead we must determine who the other judges are going to choose.
Do most people here agree with Sarmad that the sell-off merely reflects concern about higher interest rates? If so, let's discuss not just when the Fed might act, but expected duration and magnitude as well. If not, let's discuss what we think is really affecting the markets. I recognize the everpresent danger of tearing a thread apart with intense political debate. Who has time for such shenanigans? This is the full-disclosure thread. I pledge to reveal my trades as well as the thought process that goes into them, if anyone happens to be interested. In between, we discuss market trends and what we observe taking place. Hopefully we all sharpen our vision through written communication and dialog with others. We don't take iron-clad positions, but try to learn from others.
I recognize there is a fine line here and second your very fine proposed rule: If something has to be discussed that is political [or] inflammatory in nature, then please at least bring out some trading [or investing]implications [or take it elsewhere].
Sam |
