Hi Justerx, <<way brighter than I am>> How do you know I am more luminous than you? Have you hung out at this thread for some time and got mesmerized by the same soapbox spiel that I use on my in-laws at dinner time, or have you just chanced upon this corner of SI and got distracted by the various flavors of rant describing the same picture of calamity, real, impending, imagined, or, allegedly hoped for?
BTW, I am not really, mostly, just and only barely lucky. I was a C- grade point average high school student and not much better in college.
<<your risk tolerance too conservative>>
Anyway, in the spirit of fun, even though you probably did not expect to receive a long-ish reply, here I go again, you are right that my risk tolerance is different than yours, neither more nor less. Here is why …
Message 15499316
<<2001 was very very good to me and not just since Sept 11th>>
2001 was only a good year for me, without the double very(s), from day #1 to day #365, with never a down day relative to day #1, ending the year with a final tally of 8.93% without the use of leverage, with no more than 24 trades, handily beating whatever inflation there was, real, core, or suspected, and trumping whichever productivity index hedonically adjusted, satisfyingly above that of most investors and many speculators, without losing a night, not one, of sound sleep, except the night you mentioned, but not so much worried for my NAV, only about the full impact and implications of airplanes used as cruise missiles making an apparent political and/or religious statement, in the language of fear.
I hope and aim to do better in 2002, because the danger in 2002 is at least 10% less than 2001, on average, which was 10% less still than 2000, in the aggregate, and about 60% less on the Nasdaq. The problem, in a nutshell, is of course that the risk in 2003 may be 10-50% less than in 2002, and that the 10% less risk with each successive fall is small comfort to the folks intimated touched by Japan, Argentina, Enron, JDSU, ….
Here is a post mostly devoted to what I, the C- average student, do not understand …
Message 16697554
Here is a description of my risk preference …
Message 14868918
“… I am not a long term investor … not … situations where I must be right … can afford to be wrong ... nature of the game … to be more right than wrong, still standing at the end of any melee ... Carnage … screaming has started … gibed yet”
And here is a post to AC Flyer, provided with numerous SI time-stamped links, demonstrating that I am not a perma-bear, not even a bear, when he made his last appearance on this fairly laid back and definitely good-natured thread, some time ago, describing events more distant still, before the likes of FBI would show any interest on suspicions that equity values may go down as well as up, on how I turned from, in the words of Barton Biggs, ‘100% maximum bullish’, to what I am today, hiding in a craw space, high above, waiting, with scoped rifle at ready, and in the words of AC Flyer’s president, vigilant …
Message 16230052
I mean to be slightly less lethargic in 2002. I aim to do better based on increased trading of NEM and SWC options, realizing some bond (valued at cost) gains, well-timed purchase of Hong Kong and Shanghai Banking (available in US, HK and London markets, and thus liquid around the clock, 6 days a week, most country-specific holidays, giving time and space to run when required) shares, and perhaps one or two other trades during repeat of expected volatile times either due to event driven panic or V-is-fiction realization motivated dread.
I do not intend to make more than 36 trades (buying and selling included) for the entire year.
I feel that my currency allocation, unlike in the case of 2001, will enhance my overall return in 2002.
I believe the bear market will continue its messy work of slowly grinding down the life force of the trapped bulls, gouging, slashing, mincing, in chunks, lumps, slivers, and finally, leaving only fluids, hide and two horns set in a V.
What, you do not see what I imagine? As you mentioned <<we’ll see about 2002>>.
But, yes, I know what you mean, namely my focus on the problems of the world will cause me to miss the boat that sails to wealth nirvana. I am fortunate so far to have missed few such moments; actually none I can remember (I was in Amgen starting in 1983, and even in Japan’s NEC and Hitachi back in 1986, at the youthful impressionable age soon after college).
However, I am acutely aware of this very real possibility/danger going forward and I am conscientiously trying, with due diligence, to lessen the probability of the possibility, and also minimize the total lost travel time on the magical wealth nirvana boat.
As of this very moment, I believe, perhaps wrongly, that there is only the danger of missing out on Pezz’s outstanding small illiquid capital gains riding on the back of the proverbial end-of-bubble frothy bubblets, and not so much the danger of missing ‘the second half of the 12 year long bull market’ or ‘the new bull market’. It cannot be a new bull market when half the planet’s investors have apparently spotted its coming.
I treat almost everything as a game, not necessarily in the fun sense, but in the mathematics sense, with the logic of weighing the risks against the rewards, in the meaning of matching requirements for winning against my limited competencies.
I admit, I can and had played Pezz’s game, better in my home market, worse in other markets, better within short and intense time spans, much worse on a sustained basis, better with a set of few names, horrible with a bunch of names in a grab bag of business about which I have no clue, dealing in products and services I do not understand, and operated by management with track record I do not know and do not have the time to discover.
See, here is one example of Jay doing the Pezz dance, when I judged the music suitable, without knowing a thing about what I was buying …
Message 16020847
QUOTE
Most important of all … moving extremely and furiously fast when I have to, as in a game of Unreal Tournament …
Message 12463559
Message 12467735
End QUOTE”
So, critically and objectively, without bias, devoid of emotions, and uncaring about political coloration, what then exactly is the music in the market place at this moment?
Global synchronized and sustained downturn within the Yen, Euro and Dollar zone, accompanied by certainly so far or as yet inconsequential but possibly self-defeating fiscal policy, perhaps rash and probably debilitating monetary policy, spiced with occasional but record breaking failures (Japan, Argentina, WTC911, Enron), seasoned with historically proportioned write-offs (JDSU, AOL), un-justifying previously sky high valuation counted upon and borrowed against, garnished with progressively spoiling debt (national, municipal, corporate, consumer), flavored with negative savings, decorated with the total void of need for renewed growth of capital investment, gorged upon by unsuspecting J6P, cheered on by an audience of the worst sort of biased media doubling as analyst, applauded by clueless and the most expensive kind of analysts doubling as entertainers, underwritten by central banker pretending to be a magician, ultimately sponsored by all folks believing in effortless gain and painless loss … (where was I in the music?) … oh yes, and highlighted by the total absence of any motivational force of sufficient momentum and sustained credibility to move us beyond the valley of Japan, the basin of the Never-Ending Recession, and the wasteland of Telecom, in an environment shrouded in the fog of globalization, and chilled by global manufacturing deflation, all to be conceivably warmed up by derivatives of one sort or obligations of another specie(s).
So, you see, given that I perceive the tune as a grindingly oppressive funeral march to NAV hell disguised as money heaven, I therefore see no particular urgency to re-join the party at this late, officially resuscitated, and exogenous-stimulus sustained date. I do not blame the politicians and the magicians for not able to do a Viagara job on the economy, because it Just Is, after 11 rate cuts and a few trifle billions of fiscal stimulus.
I very rarely walk back in on a party I had left, having generally gotten all I deserve and want out of the setup in earlier and gentler times, given that I prefer to drop in on brand new parties, preferably in its energetic prologue … like …
… beaten down sandy bottom real estate … Thai beach land for resort development …
Message 16831204
… with stuff like this …
samuivillasandhomes.com
(oh well, site not working at times, third world and all)
Risky? Certainly. Possibility of 50% loss on investment? Not one chance in ten likely. Worst case? Live in it, surrounded by beauty, smothered in food, cooled by pool, tanned by sun, with daily massages to go. And so, after due consideration, in the fullness of time, as in the movie Risky Business, ‘sometimes you just got to say what the hell’.
On equity, I will look at Argentina in a moment, when DOW does you-know-what first, unless it is NEM, which I look to continuously accumulate via shorting of puts (up to a scary 10% of NAV), slowly, outlasting all stakeholders, bull/bear/manipulator.
On bond, I look to sell.
On cash, I look to add, hold and further diversify.
On physical gold/platinum, I look to add and hoard, just in case.
My starting position in 2002 is …
So, current allocation (now inclusive of 2001 active savings and one-off out-of-the-blue distribution:0) …
Cash 46.6% (32% Euro, 10% CHF, 2% AUSD, 3% HKD, 53% USD)
Bonds 21% (valued at lower of cost or market, mostly dollar denominated, including 0.28% dud GX and NTL bonds)
Gold and platinum metals 4.7% (80% gold, % crept up when I wasn’t watching)
Rental Real Estate 21.1% (value at lower of cost and market)
Non-performing Thai beach land 1.3%
Equity 5.4% (AMGN, AOL, CHL, CMCSK, NEM, SNE, Furukawa Electric, Hongkong & Shanghai Banking HK.5, …) w/ NEM accounting for 1.4 out of 5.4%, the largest position.
I have outstanding short positions in January SWC Put 20 (apparently no longer a mistake), March NEM Put 20 & Call 20.
I have no material debt to speak of, but having arranged lines of credit in a few currencies, ready for I seriously do not know what.
Reference last position declaration …
Message 16640103
Chugs, Jay |
