This article has made me nostalgic so I have decided to write my story of investing. I probably owned a few stocks in the 1970s but my playing the market really didn’t start until the mid 80s. At that time I started trading gold on the Comex futures exchange. I didn’t have much money so I traded the mini gold contract which was 10 ounces and highly leveraged. I had an account at Merrill Lynch Pearce Fenner Smith and Garfunkel. Whenever firms merged they would just append the names together. Before the Internet I had to call my broker to make every trade, how antiquated. But my broker was in the office every morning at 4:30 am. I lived in Los Angeles and before cable and CNBC , LA had an over the air financial channel FNN that I would turn on every morning at 5 am. Several Of my favorite TV anchors were on that channel and moved to CNBC later and I have watched them for 40 years. Sue Herera and Bill Griffeth were delightful together or on their own. Bill also worked with some bimbo who decided her liberalism was too important and she jumped to CNN or some other fading network. Ron Insana was on FNN, I liked him. My all time favorite anchor is Joe Kernen, his humor particularly against liberals is really good. I met and spoke with Joe six months ago at the AT&T tournament at Pebble Beach. He is the best anchor at CNBC.
Being a programmer and mathematician I wrote a program to trade gold. I had a few years of data and the algorithm was a simple linear regression. I would make a trade about every 3 to 5 days and slowly built up a profit over 6 to 9 months. One morning I woke up at 5 am and turned on FNN. Gold dropped $30 and was limit down. All my profit and half my capital was wiped out. I closed my account and licked my wounds.
Being a life long gold bug, my next adventure was South African gold mines that produced great dividends. I subscribed to a newsletter that compared all the SA mines reserves, dividends, etc. and I invested in Durban Deep (did that become DRD?) and others. I made some money but in the late 1980s gold only went sideways when it wasn’t going down.
Next I retired, got a sailboat and started trading from the Caribbean. I followed Louis Navalier’s newsletter and made trades monthly. One month we were in some tiny island, maybe Saint Lucia, and I racked up a $10,000 cell phone bill on roaming charges. Hard to make a profit when that’s what it cost to make the trades.
Next, I was back in California and decided to day trade in my retirement. I flew to New York and took some classes in day trading. I was hooked into a system that showed all the bids and offers and you could get in and out in 10 seconds. After 4 months I managed to turn $60,000 into $10,000. Being good at math I realized I might need to come out of retirement soon which I did.
I went to work for Intuit on Quicken. This was the year 1999 and the Internet was young, but I knew how to read a financial statement I could could see this company called Yahoo was grossly overvalued and I decided to short it. I think I was still getting disks from AOL with 100,000 free hours, I got the feeling they didn’t have a good business model. But yahoo went up more and I shorted more. Eventually I finally realized the market can stay irrational longer than I can stay solvent. I bailed on Yahoo and bailed on Quicken. Some people were leaving intuit to go to a company called Google. Now I knew what a Google was 30 years earlier, a Google is 1 with a hundred zeroes after. And then there is a Googleplex which is a 1 with a Google zeroes after.
But Google didn’t sound that interesting, instead I found out about a company that was an ASP. An Application Service Provider. No longer would you buy software in a box, you would use the software on their servers. You didn’t have to upgrade the software, they did it for you. You were not buying the software, you were renting it. Today it’s called cloud computing. That idea made a lot of sense to me so I went to work for NetLedger which got renamed to NetSuite. In 2000 when I started they said they would be doing an IPO in 2 years. Just about then the Internet bubble collapsed and those plans got delayed.
But lucky for me NetSuite weathered through the Internet crash and did have an IPO in 2007 and I was there for the IPO on the floor of the NYSE and shook Bob Pisani’s hand, another great anchor on CNBC, although he had no idea who I was.
Another great anchor was Mark Haines. I will never forget watching him on March 10, 2009 when he called the bottom in the market exactly. He was reporting with the bimbo. I am sorry we lost him RIP.
cnbc.com
Fast forward and here I am discussing trading in crypto. I just looked and in a few days I will have been on SI for 25 years, that’s really remarkable.
A warm thanks to everyone I have conversed with here. I hope I can meet you in person IRL as they say.
Chugs Dale
Btw I changed my handle to Follies sometime well after 9/11 when the FBI contacted me to tell me my name was on an Isis hit list. Later I was told the list had come from some list of trade show attendees but Isis wanted to sound tough so they said they had a hit list and just grabbed a list of names. Probably cost the FBI thousands of hours just to contact the people on the list. |
