Month: June 2012

Gold (Futures price, August 2012 basis) last 3 months

Gold (Futures price, August 2012 basis) last 3 months

The trend is bumpy, down the staircase, not quite up


One Armed Kickboxer #NOexcuses #YESyouCAN


Instead of going with “why you can’t”, go with why you CAN. For me it’s to throw off the shackles of needing icons and role models as standards I can’t match but merely aspire to. We mustn’t limit ourselves. We must try and push further than we felt was possible or reasonable to expect.

Favorite new phrase (courtesy of HBO’s The Newsroom): SPEAKING TRUTH TO STUPID :) #YES

The best returns in life and markets are lumpy

When I first started investment and speculation, it was about ideas and the “rightness” of my views versus the crowd. It was about buying cigar butts and the proverbial “fifty cent dollar”. Over time, it’s evolved into time, price and risk driven decisions in futures and lately, back to my roots in equities. Now it’s about making it to the end of the day, and being able to play the game as best as you can, as long as you wish.

If there was one thing I learned in the past few years of trading, there are many paths to heaven, and they all deal with decidedly non-linear, bumpy, bendy speculative operations. Stock picking, price following, pattern reading, mean reverting, value/capital structure arbitraging plays all have one thing in common. The best market “operators” are typically rewarded by “lumpy” bursts of munificent displays of “genius” or “prowess”, and endure or sleep through hopefully tepid interregnums of thumb-twiddling at best (or at worst, horrific givebacks of ill-gotten gains).

Some can print money, but the best operators ride a roller coaster, bucking bronco, or sit on a white sand beach, with a sweet board, waiting for “toasty” waves. Given enough time, would be “money printers”, who are in effect steamroller-avoiding nickel pluckers, will inevitably run into a bad stretch, and those who are levered up are put away and suddenly find new callings and ways to earn bread, butter and board. The humpty dumpty lumpy breadwinner, will wait, hopefully respectful of bankroll and with an ego sublimated into hobbies, long walks, book reading, wind surfing, skiing, hobo rail riding and similar sundry recreation.

This is where you will find a variety of lumpy return pros like Warren Buffett, the Tisch Family, David Harding, Bill Dunn, Jim Rogers, George Soros, and Hugh Hendry. These are some of the racing pros who can handle a Grand Prix level race, and yet are probably the most safety-conscious road drivers you’ll find on sunday outings. They know when to make a bet, how much, when to press it, when to fold and how to build their bankrolls.

In life, it’s much the same, you will have great patches, and then low/quiet periods. Your job is to do your best throughout it all, and try and be consistent in habit and outlook.

There’s usually a “tomorrow”, you will have to wake up and shower/bathe, take the kids to school, go to class, eat, go on dates or nurture/please your mate/spouse, pay your bills, mortgage and/or rent. Life goes on, and occasionally you win some door prizes with each dawn. The key is you keep striving as best as you can, with a view to surviving and making the most of each day, as best as you can. The best lives, like trading, assuming one is well adjusted, are not “all or nothing’, as it’s not russian roulette, with a view that a lucky number, tie, or gesture is your system through life or through trading. Your four leaf clover is your ability to adhere to your most helpful routines, rain or shine, and to keep going, and to discover and pursue your passions, and have as much fun as you can doing this while you’re still breathing, and hopefully have the good sense to share the fun with others. Otherwise, what’s the point Mr./Ms. Scrooge?

Lastly, what comes with the best lumpy market operators, is the ability to deal with uncertainty. They deal in risk and time, allowing them to set up the right size and price as a result for each play. Over time, each of the aforementioned pros, and their colleagues are able to manage the reality of uncertainty. The best of them deal with a changing market environment and shifting opportunity costs for their specialities, and can pick their spots and moments to play. Otherwise they stand pat and sit on hands, happy to go play and pursue other passions with one eye peeled for the next play.

Consider doing likewise in your market operations and life, but I’m willing to bet you’re already doing this. 🙂

An amazing Frenchman in 1993 builds a motorcycle from his busted Citroen to escape North African desert



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Bronte Capital’s follow up to China’s Kleptocracy

Bronte Capital’s follow up to China’s Kleptocracy

Here is a sequel piece by an incredible money management firm that posts excellent articles, particularly lately about the fraudsterism present in China’s Market Leninism.

A chart of $CHK

A chart of $CHK

A chart of Chesapeake Energy $CHK loved for assets and reviled by some for its chief asset accumulator, Aubrey McClendon

FED Watch: Let’s Do the Twist (some more)?

Paging Doctor Copper: A snapshot of recent price action on $HG_F

Not enough for me to offer real commentary, just looking at a chart of copper.Image