it is all rather phuc8#@!ked up, frankly, if one takes that made up word to mean 'fantastic' as in 'unbelievable until recently and not yet fully accounted for'.
Tenants asking for temporary rent reduction, mortgagees ask for payment forbearance, leasees to go under, suppliers cratering, consumers belly exposed to the sky, debtors blowing up, creditors submerging, and and and such cutting across the entirety of the planet, and authorities and those in strong-influence unleashing negative rates and cranking up positive dilution, to save us by drowning us.
What could go wrong? V-shape recovery? Brave wager by the folks responsible for last nights ramp.
(1) I am short as much calls as I am short puts, +/-, close-enough, in net-liquidation basis, meaning if I were to shut down the option book and go home.
(2) I am at notional short-risk : long-risk 5:2, meaning if everything goes wrong against my trades on both sides of the fence and I am putted as well as called, with the shares all going to zero there-immediated-after-exercises. In such a case the account blows up because the notional is ~50% larger than the NAV in the account.
(3) But my shorted calls (have only shorted TSLA calls) are are calibrated near but hopefully not too near the respective danger zones, and my shorted put (gold, gold mining, tech, and consumer, in order of relative sizes, large to small) strike prices are mostly at 50% below current prices for non-gold related stuff, and should be safe enough.
Unclear to me what would make them go to zero other than a legal ban on the gold sector. In the event of a legal ban on gold, I wonder what physical would be worth even as paper goes to zero.
(4) My equity longs are at 1/14 of notional value shorted calls and shorted puts, and at 5:3 to net liquidation value of shorted calls and shorted puts, mostly gold, and when not gold related, either oil / gas or palladium related, or ETHE crypto.
(5) Have not directly shorted any shares. Prefer to stay well away from the hand-to-hand / house-to-house / street-by-street combat at this time. Long range barrage is more appropriate, I believe.
(6) Should I sum up the net liquidation value, buy back shorted options and sell long shares, that net number is ~5% of total account value, about right, given the volatility implied in the market.
So far the gaming has been exhilarating, educational, and profitable, therefore fun.
In the meantime I have often wondered what it would take to be forced to live in a foreign land and make do, and as we are in lockdown in Cape Town, and HK has just announced lockdown (no international flights), I need to ever wonder. I know. How fantastic is that. Who would have guessed say on January 1st, or 31st, or anytime in February, or a good part of March?
The kids have and shall learn much. All good so far.
Received an e-mail this day. I am thinking, multiple K's situation by a few hundred million or some portion of 8 billion, what do we then have? Binge-watching Netflix mob sitting at home waiting for government replenishment lending to them against their future? And if no handouts, mortgaging the future, then what?
V-recovery?
I hope for V, but would settle for U, because L can certainly be, and worse, \| straight down
I hope we are only in dress rehearsal for 2026, and not at the beginnings of the main show. Let us see how sincere the authorities get energised to.
In the meantime, sure, let the rampers ramp, to set up a higher ledge from which to fall with less risk of failing to fall.
Believe the approach of MMT / a check on every table is fundamentally flawed even as necessary, for it does little for folks needing such most, allowing them to pay for 'essentials', and is wasted on folks not needing such, giving them a bit more of dry powder to wet, or to buy gold and such anti-social behaviour. The sums are neither here nor there for the many in the middle. The multiplier effect, whilst not zero, is not great.
Better, much better, if MMT / infrastructure buildout, so that folks can get jobs, and get on with lives.
What is being done in many if not most places is simply filling another bottomless and blackhole, where money disappears into and never come out, akin to the bank bailouts.
If we believe that most authorities shall come to same conclusion, we need energy, infrastructure, and resource wagers, and need to engage with them before they are engaged.
Do we believe?
Where stands Germany, France, UK, Japan, S Korea, Brazil, S Africa, Australia, Russia, Canada, Saudi Arabia?
USA?
On 7 Apr 2020, at 4:01 AM, J wrote:
Hi K, perfectly understand.
My family and I are stuck in Cape Town South Africa, locked down here until at least 17th April for sure, and likely extended to mid-May on the table, even as I see HK is locked-down as far as international flights are concerned.
All incredible.
Best, J
On 7 Apr 2020, at 3:46 AM, K wrote:
Dear J,
I just want to give you a heads up, as we had agreed previously, that I may not be able to make the next round of mortgage payments.
All my seminars have been cancelled, and at this point, it looks like I will have no income for over 8 months or even longer. My last income was in November and the next was supposed to be March, but obviously that has not happened. Currently, I am not yet sure of when classes can be rescheduled.
My intention will be to catch up on the outstanding payments and get current as quickly as possible after things resume.
Hope you are well and relaxing with the family.
Warm regards,
K
|
