September 2008
30 posts
Herd Mentality
Scientist have found that in times of crisis we humans are hard wired to follow the herd. We stop listening to our own logic and turn to others for answers. I believe this is also true in times of greed, as we have seen with the housing bubble. Otherwise smart people didn’t do proper due diligence and just followed the crowd. If everything is appreciating, who needs to rely on logic and...
The funniest email in a long time
I signed up for OurStory.com when they launched a few years ago by recommendation from a friend. The service is basically a blogging platform with a timeline to share your life stories with the world. The idea was not bad at the time; it was just poorly executed and didn’t gain any serious traction. Today that space is saturated and the only opportunity is as an agile niche play like...
Congress Wakes Up - At Last
Congress’ defeat of the bailout plan is the best news I’ve heard in a while. Having taxpayers to pay for the toxic assets and leave the healthy parts of the business in the hands of the board, management and shareholders that created this financial mess is absolutely insane. Socialism for the rich as it were.
Sweden were in a similar precarious situation when I was in college studing...
"Renting Makes More Financial Sense Than... →
Why I Love Recessions
Most people view recessions as evil and try to ignore the fact that they are a natural part of what is called the business cycle. The economy expands and contracts with regularity and that should come as no surprise to anyone, at least not to Wall Street folks.
To me, every recession has created fantastic opportunities. The greed is subdued and people tend to care more about life than about...
In A Ding Ding Dong Dong World
I’ve always enjoyed making sense of chaos and uncertainty from a fresh perspective. Here are a few thoughts:
The vilification of the Wall Street survivors / winners is unbelievable. The guys that took the winning side of the housing, financials and commodities trade are now being blamed for the financial turmoil. I naively thought Wall Street was about the survival of the fittest and not...
Key Reversal Day II
Yesterday the VIX spiked to above 40 but the treasuries didn’t follow. Clear signal that the market was ready to capitulate and ignite a very strong rally. VIX reversed in the afternoon and the treasuries took a plunge. The rally was confirmed.
Today we are having a very nice follow-through day, but hitting resistance level 1265 on S&P 500 with the treasuries crashing and the VIX still...
Coffee with Palin or Football with Obama
I got this email the other day that argued that Palin is such a standup politician that you would love having her over for coffee. Today Obama is scored as the winner in a poll of who folks across the country would like to watch football with. Are people raving mad? I’d prefer neither. I’d be damn happy if I never saw or meet either them.
My only humble wish is for them to focus on...
Fringe Science
If there is just one reason to watch *TV* this season, it’s the new show Fringe. It’s all based on Fringe Science, i.e. theories of how things works that are outside the mainstream science community but originated within. Cold fusion is one example of a fringe science.
Fringe is neither for the weak-hearted nor the religious fundamentalists. It will surely challenge the way we look at...
Key Reversal Day
Yesterday I wrote: “Another positive is that we had a 10/90 day; 10% of volume and ticks were bullish and 90% were bearish. These are usually followed by snap-back rallies.”
Today we snapped back with vengeance and it will continue tomorrow. The day started with retail investors / traders panicking pushing Dow down to 10,743. Then the bounce started and brought Dow back 350 points to...
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The Real Estate Bubble - Act II
Yup, I keep insisting calling it a bubble cause that what it is. Been doing that since the fall of 2006. The counter arguments have been many but I think sellers who have refused to come down in price, with the result that transactions have dried up, will slowly rethink. Prices needs to be affordable again so there is still room for depreciation.
The layoffs in the financial industry in New York...
A 500-pointer!
It was a few years ago since we saw Dow plunged 500+ pts during one day. The last time that happened was 8 years ago on April 14, 2000 when Dow tumbled 618 pts. The good news is that the index bounced back 2 trading days later. Another positive is that we had a 10/90 day; 10% of volume and ticks were bullish and 90% were bearish. These are usually followed by snap-back rallies.
The Wall Street...
It's in everyone’s narrow interest–except for... →
The Devil Wears Prada / The Emperor's New Clothes
America is having a love fest with McCain’s running mate, everyone’s favorite hockey-mom Palin. She came from nowhere and into the hearts of millions of suburbanite, God-fearing, SUV-driving middle-aged and older conservatives. I think some folks like the romantic idea that their next door neighbor, Mrs Goodytoshoes, could actually end up in the White House and maybe even in the Oval...
Watch‘Buy and Hold’ Is for Fools!
Market Thoughts
We got our key reversal day yesterday with nice follow-through for energy today. The dollar pulled back 1.55% after having met resistance at $80.39 (Dec 2004 low). The 20-year treasury pulled back as well and closed down 1.3%. They are clearly oversold but were brought down by the dollar and by demand for higher yield now when the US Government is severely in debt. Some fear of a Lehman bailout...
Zapped by Zappos (but quickly redeemed)
This is the second time this month that I’ve been refused by UPS to return pre-paid Zappos parcels. The reason is that Zappos underpayes for their deliveries. A parcel that weights 14 lb gets a 8 lb postage label. UPS dislikes that and refuses to receive the parcel on behalf of their drivers.
Well, here is what you do to stick it to them both. You use two boxes instead of one and...
“Strategy without tactics is the slowest route to victory. Tactics without...”
– Sun Tzu
My Genius Playlist
Being an Applehead for 24-year I obviously tune into all Apple events with a pounding heart and sweaty palms. What will they think of next?
We knew that it was only about the music this time so not a lot of Ohs and Ahs. The new iPods were really cool, the touch great but what really stood out was the new Genius feature in iTunes 8.0. Discovery in general and self-discovery in particular fits in...
Fanny & Freddie rocks the markets
The S&P futures are up 36 points (and the key Asian markets are up 4% so far) as we speak due to the Fannie / Freddie weekend rescue. The US government is guaranteeing $5 trillion on residential mortgages, about 50% of the total US market. This will put in a short-term floor and ignite the markets for a well-sought after fall rally. But anyone that thinks that the mortgage crisis is over need...
Market Thoughts
The expected rally turned into 4 days of decline with a potential turnaround today. We are now at levels where a lot of strong stocks and ETFs are loooking really tasty. Financials led the party today w/o any significant help from energy or technology. But the four horsemen are looking good at these levels, especially two weeks away from OPEX for a short run.
I’m still bullish on the...
Great art is about heightening our experiences. To... →
Richard Meier
In Your Fridge
The Missus came up with a great idea yesterday, she said: “Why don’t you start a blog about how people can use what they already have in their fridge to make great meals? You are so good at making gourmet meals out of practically nothing!”
I took that as a huge compliment, right after our first homemade pizza (which I replicated for lunch today - even better this time since I...
The Panzanella Salad
I recently discovered the Panzanella salad as I was reading the CIA Cookbook. It’s a leftover bread salad with olive oil, ripe tomatoes, croutons, grass-fed bacon, feta cheese, onions or anything else you have in the fridge (eggs, lettuce et cetera).
The basis is a dijon vinaigrette with tomatoes and bread made into croutons. Make sure that you start with the mustard and the wine vinegar...
