Curiosity Over Pride (FYI: To comment, send an e-mail to scifidink@gmail.com)

Thursday, May 6, 2010

Krugman thinks Greece will withdraw from the Euro anyway

The fact he even thinks it means others are thinking it too...

The first rule of disasters is don't panic.

The second rule of disasters is if you are going to panic, you better be the first to do so.

Britain is not in much better shape and with a public sector that now accounts for more than 52% GDP, Britain has issues.

This is quite interesting in light of the following report from the UK's own NHS, health access disparities have significantly increased in the UK despite equality being a primary goal of the NHS.

So what will happen to US banks?

Have they sufficiently looted the US Treasury to withstand a collapse of US treasury funding?

I guess the better question to ask is: where are the stable war-chests?

This is getting scary. Maybe Edwardo is correct and we should all keep some physical bullion in a can at home.

... My wife will never agree to this btw.

18 comments:

Dink said...

"This is getting scary. Maybe Edwardo is correct and we should all keep some physical bullion in a can at home.

Seriously scary. But I still maintain that I don't want precious metals. I want machines that will make potable water and connect me to the intertubes. And, of course, yurts.

"... My wife will never agree to this btw."

I'm in the same boat. Being married to a reasonable person has so far been a blessing (nearly two decades). Of course, I can imagine a scenario where the US Treasury implodes and zombies roam the night, but we still pay our property taxes and mow the lawn. Its the right thing to do. We are civilized people dammit! :)

JP said...
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Dr John said...
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Thai said...

I really should try investing again but I so much prefer the Rubic's Cube mental masturbation of the whole thing.

I have enough worry about other people's health every day.

People trust me so I will trust (some) people.

I often wonder what my adviser is doing but I think all of us can agree without even asking that he probably wonders the same thing as well.

Everyone have a wonderful weekend

Dr John said...

I have said this before Thai but your knowledge and interest of finance seems far beyond anyone I know in everyday life at least on a macroeconomics but I certainly can understand wanting to divest yourself of the whole thing.

I have had bad experiences with money managers and they have turned out to be mostly salesman. If I go down it is at least at my own hand.

Suicide can be a noble gesture after all I guess.

Thai said...

I like my manager.

He has made some good calls.He has made some terrible bad calls. He does have a system. He is bright and seems VERY ethical.

My money is invested in the exact same portfolio he has his own money in (only he makes the additional 1% off mine)

He thinks about this stuff all day and I'm thrilled to give him the 1% to make the tough calls.

I read about it for hobby/fun like others watch sports (which means I enjoy it and if I was serious, I might stop enjoying it which seems far more tragic to me).

Everyone needs a hobby

Be well

JP said...
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Thai said...

Well I'm glad you joined us.

Where do you see the best investments this year?

Besides 30 year treasuries and gold, and I guess inverse ETFs (shorting) if you've got bigger kahunas than I (kudos for calling that), do you see anywhere else?

Thai said...

"Then I realized the level of fraud endemic to the entire financial system and the essentially random allocation of resources during manias."

This is the biggest tragedy

Of course I guess nothing good ever happened were it not for speculative irrational exuberance so it is a kind of catch-22.

Edwardo was commenting the other day how he kind of agreed with the communists that there is tremendous mis-allocation of resources and I have to say I really do agree with him.

Yet implicit in this is always the issue of viewpoint/morality since it is always relative to any particular viewpoint/morality.

Thai said...

By the way, do you have a good link on Fourth Turning/Crisis Era/K-Cycle Winters besides Generational Dynamics?

JP said...
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JP said...
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Thai said...

Steve Cucchiaro (Windward's founder) has done very well for my family and me and for that I'm very grateful.

Oddly enough, December 2005 was when I moved to Windward. And I was in the aggressive portfolio. But in March 2009 I move most of my money into an "experimental portfolio" Windward created specifically with deflation in mind.

Unlike the other portfolios, which now have quite a bit of money in them, I think there are only a few people in this portfolio (about 1/2 dozen). I think it's called the Windward Global Opportunities Portfolio (but what's in a name?) and last I checked, Steve had about 1/3 of his own personal net worth in it (he moved some of his money from this Aggressive portfolio).

I figure we both sink together if it flops. Who knows?

Anyway, the largest allocation (41%) is to equities (about 60% foreign/40% domestic) and hard assets come in second at 28% of the portfolio which includes the biggest position in the entire portfolio: DBC (21-22% of the portfolio). Unfortunately DBC has been hammered in this recent correction and is now down 6% YTD.

So I'm up 27.5% cumulative since 12/15/2005 (which is about 4%/year) and the portfolio is up 2% YTD '10.

S&P is up 4% YTD as one of my benchmarks so I'm still happy as the portfolios are designed to be very stable not bounce around nearly so much which let's me sleep at night (and poke fun at other investors who think they have this thing all figured out).

... Although they do have a 1% advantage on me and long term that is a hard tailwind to overcome.

Steve has told me on many occasions that the alpha for the entire financial services industry is quite negative (as you would expect) so I am taking my chances.

Thai said...

Re: "The problem is that everything here depends on random panicky injections of liquidity into European markets."

I think this is deliberate (I mean the random nature) of the injections.

At least the random nature to you and I.

But I do not think they are so random to people like Hell.

Thai said...

Here is a Barron's Article on Windward in.pdf format

JP said...
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JP said...
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Thai said...

By the way, I don't trade stocks as I said but for family reasons I have been following a company called CREE for about 15 years. My father used to work in the Semiconductor Equipment Manufacturer Industry and knew a number of the people who founded the company.

He thought they would be huge one day and as such I owned some in 1998-1999 and did pretty well a before the NASDAQ crashed in 2000 (I got out in time).

I have been thinking about owning it again as it looks like they may actually seriously make it into the incandescent bulb space after all.

Anyway, you might look into it

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