I can't believe I was able to find a picture of Martin Short as Nathan Thurm.Many folks no doubt want this week to end and hope the correction finishes today. So far I am not sweating this, I remember what 1997 and 1998 felt like so 4% or whatever just is not the same.
There is nothing wrong with being emotional if that is what you are but what you do with those emotions is what matters.
Barry's interview on CNBC was a little scary no doubt as he thinks 20% could happen with this but he said that the vast majority of the time the market is higher one year later. Think about that for a moment.
The SPX was around 1450. If one year from now it is higher than that does it matter, really matter, if it goes down 20% now? I will probably take a little, just a little as I have a little bit of cash raised now, defensive action if the 200 DMA is breached but what I take from Barry's comment is that if I cannot successfully avoid a chunk of the decline the consequence is not that dire.
To be clear I will be disciplined to my exit strategy but sometimes an exit strategy works as hoped for and sometimes it doesn't.
We are best off not being emotional and sticking to our respective exit strategies; something I preach all the time here regardless of what the market is doing.
9 comments:
I don't know what you're talking about. It's so funny that you would say that! They don't make schnozzes. They make semiconductors for a very reputable computer company. What's wrong with that? Is there something wrong with that? Why, why, why is that something wrong to do? I don't understnad that. Why are you pointing the finger at other people all the time? Why don't you point the finger at yourself? Do a little more reading, maybe? Some time in court - maybe that would be effective for you!
"Well it pertains to your company."
LMAO
Given the snafu this week, and my Fidelity active trader pro basically froze for 30 minutes, I hope folks are reminded that though you may have an exit strategy, getting to the exit prior to getting your butt nipped by flames (or worse) may not be possible.
What I truly wish is that most retail folks (and I'm one of those) understood the new hedging products. I will tell you that most of my friends with invested money do not know a damn thing about hedging--either strategy or products.
Leisa you raise the point that most people don't pay very close attention to their 401ks and in a way they may be better off. They certainly don't over-trade their accounts!
I think there is at least one blogger out there that touches on the short and double short funds. ahem.
:->
Well, Roger, of course you are one of those! I've committed the last year and a half to really be a student of the market. But it really takes alot of head scratching and head hurting to make sense of it all. I don't pretend that I've made sense of it, but I'm a hell of lot smarter now than I was then. Well...at the very least, I know what I don't know--that's a start. Nevertheless, I know that the investment of time and energy will pay big dividends for me.
But I want to shake people and say "Get a grip on your investments", but for the most part, they are sleep walking through it. I try not to be too much of an evangelist...but I do send e-mails out to my friends from time to time to get them to meet with their financial advisor to ensure that their portfolios are aligned with the economic stars.
As you know, I greatly appreciate the time that you spend sharing your knowledge.
What is scary is that most hedge fund managers have not invested/traded in a true bear market.
The 87, 98 markets ('00 - '02 to a certain ext, tech bubble sector group) had there extremes but bounced back in fairly short order.
The '70s was a bear market - in my view. Trying to contemplate how money managers would handle that type of market is a very worrisomse issue.
in the good ol' days, as the bubble was going poof we had a day where the nasdaq was down 700 points intra-day.
Then somebody posted on ClearStation that the Nasdaq did not look good and they he (or she) is closing all their longs.
I was thinking, wow, this guy is bailing at the bottom. The nasdaq proceeded to lose around 50% from there...
On Tuesday i was looking at this as a buying dip. I closed my puts and put some more cash to work on the long side. But the action since is not comforting. Also the way GLD behaved is disturbing.
I am placing hard stops on my longs right below the lows from Tuesday... if we gap down or drop again then i will be on the sidelines watching except for couple of shorts.
Gold is down, that’s deflationary.
Silver, nickel, copper and value stocks are down, that’s deflationary.
Housing is down, that’s deflationary.
Japan is deflationary, that’s deflationary
The US government sells TIPs, that’s deflationary.
The government went into uber-debt under total control of the “fiscally conservative” political party. That’s deflationary, since no one can win on a spend-spend-spend platform for a few cycles.
If the Fed defends the dollar (which it has to since if it doesn’t, our $800B net imports will cost a fortune) that’s deflationary.
Short US interest rates are high only because the Fed keeps them high, that’s double deflationary.
Lots of debt is deflationary, Ceteris paribus. Corporations can’t find good investments and are building cash. That’s deflationary (helping money market accounts hit $2.4T.)
Who has a deflation ETF? Who has the deflation family of funds?
The gold bugs think inflation is coming, meaning deflation is coming.
It’s a deflationary slow down. People are used to inflation, worry about inflation, buy houses because “they always go up” and prepare themselves for inflation.
American’s are always and everywhere – thinking about - a monetary problem. That’s deflationary.
Tobot, I tend to think that history shows that being threatened by a hedge fund would likely only come from one fund failing. LTCM was a threat caused by one fund. Amaranth, if that was even a threat, also one fund. Could funds fail yes but the systemic threat is probably small, IMO.
VennData, "Japan is deflationary, that’s deflationary" great line! Mish has a post up from a week or two ago making an argument that gold is ahedge for deflation not inflation. Not sure what I think but it is worth reading, given your comment tonight.
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