Your Almost Daily Bit of Wall Street Wit & Wisdom

“What is life but playing with time..?”
— Keith Richards

We’re heading up to LA for a few days to see our ‘kids,” celebrate our 31st Wedding Anniversary, and jam with the Stones!:-)

Their sound is timeless and always great to hear.  In my opinion, the old musicians are better than the old athletes; they can still play.

Investing is something done over time.  Speculators must be keenly aware of time.  Options are wasting assets, whose time decay accelerates over the last few weeks of their life.

In life, time truly flies.  We’ll be trying to slow it down a bit over the next few days, before we pick up the scrapings and get back to work.

Best regards and gold rings on ya,

Steve

Your Almost Daily Bit of Wall Street Wit & Wisdom

herd mentality

Bullish herd mentality, h/t B. Rich / Hedgeye

“Irrational behavior is, ironically, the most predictable behavior.”
— Chris Carolan, @spiralcal

The human behaviors of buying and selling drive market price movement.  Human behavior is often emotional and a herd mentality can kick in.

Market price tends to climb a “Wall of Worry” and slide down a “Slope of Hope.”

You saw it last week, the previous week, and you’re seeing it this week.  You’ll likely see it over the weeks ahead, as well.

Best regards,

Steve

Your Almost Daily Bit of Wall Street Wit & Wisdom

Geodesic dome

Geodesic dome, h/t R. Buckminster Fuller Estate and bfi.org

“I’m not trying to imitate nature.  I’m trying to find the principles she is using.”
— Buckminster Fuller

Often, patterns of market price movement resemble fractal patterns found in nature.

The thing for traders to keep in mind is that there is never certainty, only probability.

I hope your week gets off to a bright start.

Best regards,

Steve

Your Almost Daily Bit of Wall Street Wit & Wisdom

Point drops in any index, be it the DJIA or the S&P 500, are meaningless.  All these ‘3rd largest (point) drop in history’ stories are meant to mislead and scare you.  Don’t let them.  The only thing that matters is by what percentage did an index or stock decline or advance.”
— Jim O’Shaughnessy, @jposhaughnessy

 

Your Almost Daily Bit of Wall Street Wit & Wisdom

Obvious Man

Obvious Man, from Wiley Miller’s Non Sequitur comic strip h/t gocomics.com, Andrews McMeel Publishing

“This is the greatest non sequitur in finance.”
— Jim Grant, editor of Grant’s Interest Rate Observer

The venerable Mr. Grant is referring to bonds priced to yield less than zero.

Deutsche Bank data shows negative yielding debt has topped $15 trillion, representing 25% of all outstanding bonds.

Negative interest rates are not good. They reflect and forecast trouble.  They have serious consequences for investors and sovereign nations.

Who would buy negative yielding bonds?  See the Greater Fool Theory.

Don’t be a fool and don’t be cruel.  Spread some kindness today.

Best regards,

Steve

 

 

Your Almost Daily Bit of Wall Street Wit & Wisdom

“What protectionism teaches us, is to do to ourselves in time of peace what our enemies seek to do to us in time of war.”
— Henry George, American 19th century political economist

Overnight and this morning, markets are exuding a whiff of panic over an escalation of the US/China trade war.

Trump’s tariffs, negative bond yields in Europe, the spreading of deteriorating economic conditions, and geopolitical tensions boiling all add to uncertainty.

With two more senseless US mass shootings and ahead of a likely violent crackdown coming to quell protests in Hong Kong, we hope for a day when sensibility and kindness hold sway on political leadership to get them to stop the madness.

50 years removed from Woodstock, we sure could use some of that Peace and Love.

Best regards,

Steve