Lion of the Blogosphere

Archive for the ‘Investments’ Category

Never come to my blog for stock advice

with 57 comments

Another bad day for stock prices. This post could have been me capitulating to the bull market.

Written by Lion of the Blogosphere

February 8, 2018 at EST pm

Posted in Investments

MSM blaming stock market volatility on Trump tax cuts

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They say that the possibility of inflation and budget deficits are hurting the stock market.

I don’t actually buy it. Why didn’t the volatility start in December? Unlike all other tax cuts in my lifetime, the HUGE tax cuts on corporate income are beyond a doubt bullish for stocks (at least in the short run). Rational analysis is that stocks are worth more after the huge corporate tax cut.

Bubbles pop for no reason at all. But if Trump took credit for a bull market that started many years before he actually became president, then it’s to be expected that the people who hate him will gleefully blame him for a bear market (although it’s not at all clear yet that a bear market has begun).

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My opinion on the wisdom of the tax cut is that it’s bad policy to feed a bubble, and that the top 1% rich didn’t need their taxes cut, and based on how much they hate Trump and supported HRC, they didn’t deserve a tax cut from Trump and Republicans. The tax cut should have been more targeted to benefit the prole whites who voted for Trump.

Written by Lion of the Blogosphere

February 8, 2018 at EST am

Posted in Investments

The CEO with the bad toupée

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Many years ago, shortly after I started working for a biotech company in Phoenix, I asked someone, “who’s the old guy with a bad toupée?” That was the CEO. His bad toupée was legendary. A topic of discussion on the Yahoo Finance message boards.

Written by Lion of the Blogosphere

January 29, 2018 at EST pm

Posted in Investments

Bitcoin bubble?

Jonathan Ratner writes in the Financial Post, “Whether it’s the shoeshine boy of decades past, or the taxi driver of more recent times, an old investing adage suggests that when somebody you wouldn’t expect is talking stocks or giving you portfolio advice, it’s time to sell.”

I just overheard one Indian IT person teaching another Indian IT person how to buy bitcoin.

Time to sell?

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Can bitcoin ever be a useful unit of exchange for the AVERAGE person? Today, the average person doesn’t know how to buy or use bitcoin, and even people who know how to buy it and use it all too often have their bitcoin stolen by hackers.

(Of course, things can change. I once thought the average person would never use the internet, and boy was I wrong about that!)

Credit card transaction fees suck, but nevertheless the credit card companies provide enough added value and security that they are almost universally used and accepted by both consumers and merchants. What’s the catalyst that will cause everyone to switch over to using bitcoin?

I recently pointed out that computer game site Steam recently STOPPED accepting bitcoin because it’s less expensive/risky to just take credit cards and Paypal despite the transaction fees.

Written by Lion of the Blogosphere

December 28, 2017 at EST pm

Stock market advice

I just bought some SPY (a large ETF that tracks the S&P 500).

Based on the proverb to “buy the rumor, sell the news,” this is a good time to sell, with the news being the Republican tax bill.

But I think that post-tax-bill animal spirits plus the January Effect will keep stocks buoyant through at least February.

However, I don’t feel strongly enough about this to go 100% in. And there’s the usual warning that my timing advice is more often wrong than right.

Written by Lion of the Blogosphere

December 20, 2017 at EST am

Lion car recommendation: Honda FIT

Total cost of ownership is only about $5000/year (because of low price and high gas mileage). That’s a lot less expensive than any electric or hybrid car. Furthermore, because it’s a hatchback, it’s very practical for being able to transport a lot of cargo for a small car.

It’s also good for keeping gold diggers and other high-maintenance women away.

Written by Lion of the Blogosphere

October 23, 2017 at EST pm

Posted in Investments

Amazon acquires Whole Foods

When I first heard this news, it felt really huge. Like big changes are coming supermarkets and retail in general. Huge changes.

Wall Street (collectively) had the same feeling. Normally when there’s a corporate takeover, the stock price of the acquiring corporation goes down. But this time, stock price of Amazon went up, and the stock price of every other supermarket and retail company went down. This reaction to a corporate takeover is unheard of. At least, I don’t ever recall such a thing happening before.

It should be noted that Whole Foods is the most SWPL of all big supermarket chains. The future of retail is divided into prole or SWPL with nothing in between.

Also, it seems to me that supermarkets are the only type of retail which I don’t see being replaced by online sales. You can’t buy meat and dairy online. They will spoil by the time they get to you. Unless you have fast delivery using refrigerated trucks. Which requires a large physical local infrastructure. And Amazon is buying part of such an infrastructure with its acquisition of Whole Foods.

Written by Lion of the Blogosphere

June 16, 2017 at EST pm

Posted in Investments

I was totally wrong about a post-election stock market crash

Yes, I am not always right about things. But unlike the smug left-wing mainstream media, at least I admit when I was wrong.

I wrote this post about the possible stock market crash if Trump wins. So what is the market doing today? It’s soaring.

At least I have good company. Last evening, Paul Krugman wrote:

It really does now look like President Donald J. Trump, and markets are plunging. When might we expect them to recover?

Frankly, I find it hard to care much, even though this is my specialty. The disaster for America and the world has so many aspects that the economic ramifications are way down my list of things to fear.

Still, I guess people want an answer: If the question is when markets will recover, a first-pass answer is never.

Wrong, wrong wrong. It took the markets less than 24 hours to recover.

I may have also been wrong, but I don’t have a Nobel Prize in Economics and don’t get paid a lot of money to write a newspaper column in the world’s most prestigious newspaper. And I don’t expect Krugman to apologize.

Written by Lion of the Blogosphere

November 9, 2016 at EST pm

Posted in Investments, Politics

Today I sold all of my stocks

Last month I sold half (on a poorly timed day) and today I sold the rest, so I now have no money invested in stocks.

The financial markets scare me with the S&P 500 Index being close to its all-time high (which was in August) and the presidential election coming up. My conspiracy theory is that the Illuminati are holding the market together to help HRC win the election, because everyone knows a market crash hurts the party in power: McCain had no chance after bad financial stuff happened in September.

If I turn out to be wrong, well here’s a public record, so you can make fun of me later.

Written by Lion of the Blogosphere

October 28, 2016 at EST pm

Posted in Investments, Politics

Will the stock market crash if Trump is elected President?

To start, let me point out that the stock market is near its all-time high. The S&P 500 index is significantly higher than where it was at its previous 2007 peak (before the crash in 2008). Stock markets crash when they are near all-time highs, so even without the Trump factor, the market is in danger of crashing.

Then there is the observation that when the stock market does crash, it tends to happen in the fall. There’s no way of knowing if this is mere coincidence of if there is something to it. But the historical accident of previous crashes happening in the fall could cause the cycle to repeat itself again because the stock market is based as much on psychology as it is on the logic of financial valuations. If traders think that other traders will sell because it’s the fall and they think the market is risky in the fall, then they will want to sell before the other traders, leading to a cascade effect of selling.

And finally we get to Trump. The mainstream media has been pushing the meme that if Trump is elected president, it will be a “disaster” for the economy. For example, using the word “disaster” in the headline, Business Insider reports:

Willem Buiter, the chief economist at Citi, said in a note to clients on Thursday that a Trump win would weigh heavily on financial markets, and that his policies would deter global trade and economic growth.

Brian Klaas says in a Newsweek op-ed:

The second problem for Trump’s Frankenstein economics is that his seemingly contradictory proposals would be a disaster if they were enacted. Moody’s economic forecasting conducted a nonpartisan analysis of Trump’s proposals and concluded that they would lead to a loss of 3.5 million jobs. And they would cost the U.S. economy trillions of dollars of lost growth.

If Trump wins, some people actually believe the disaster predictions and will sell before everything goes to hell. And then there are those traders who may not believe the anti-Trump propaganda, but they believe that other people believe it and will want to sell first, because no one wants to be the last man holding the bag (that’s for Joe Sixpack holding mutual funds in his 401K).

Also, I think that some people will want the stock market to crash if Trump wins, in order to punish the stupid voters who elected him and to be able to say “see, we smart liberals told you so.”

Right now, everyone believes that Trump has no chance of winning, because he’s just too low class too win, and polling throughout the summer has shown a huge lead for Hillary. But if polls start showing that Trump is in the lead, this could trigger the stock market crash before the election even happens.

Or it might not happen that way at all. Predicting the stock market is beyond the power of most mortals. No one should buy or sell any securities based on this blog post which has been written strictly for entertainment purposes.

Written by Lion of the Blogosphere

September 15, 2016 at EST pm

Posted in Investments, Politics

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