Small Caps

It doesn't get any lower than Canadian small caps in the eyes of some. My favourites are GDL and SMT, I own both. Now that everyone is majorly hating on value investing I am all the more confident that it will produce sizable long term gains. I'll write about value investing later. The point I wanted to make here about small caps is that they seem to be rebounding a lot more than the market, many 20%+ off their bottoms.

Buy Stuff

I had to move from Germany back to Canada so excuse my absence.

I don't offer any advice besides "Buy stuff." And not inverse ETFs. Actually I would advise against buying leveraged ETFs too.

Look for ways to get long big leading banks, oil because it can't go any lower unless they give it away, and perhaps short the USD into extreme strength in the short term and certainly in the long term.

Robin Williams is hilarious about the bailouts on Jay Leno right now.

Whatdaya Know

We jump up yesterday, futures down heavy all morning, do we go back down today?

MS posts a much larger than expected loss, did they go down today?

Does the past week not look sneakily bullish to you?

The answer to all of these questions is a resounding NO. Actually in the case of MS you might follow up with a "wtf?". I'll help you out, they bit the bullet this quarter apparently so that future earning will be higher.

This is what I was hoping to see today, not another huge day up, but a steady day signaling that everyone is comfortable with yesterday's gains. Now all we need to do is rinse, wash, and repeat.

Don't mess with the US

The US has decided that they aren't taking anymore shit.

It's so crazy it just might work.

A lot of BAC haters out today selling. Haters. Pff.

Who would have thought GS and MS would shoot up after posting losses (assuming MS does tomorrow).

We have to be looking at some inflation and devaluation of the dollar sometime in the future though. Something to think about.

Nobody Knows

.. what the hell is going on in the market. I have heard a lot of bullish sentiment lately but despite that we are still headed lower. How much lower than our previous lows will be go? Anyone's guess really. As time goes on today, I think more and more we are headed lower. If we do head back to Dow 7500 and S&P 750 territory I doubt we will go much lower than that for any prolonged time period. My guess is that when it's all said and done we will have a nice example of a double bottom bear market.

Since I'm a dumb optimist I will continue to buy stocks.

Could be a big day

Asian markets continue their uptrend. If the Auto bailout materializes I suspect we will rip higher. Regardless, you'd have to have some big nuts to be shorting into today.

Stocks and Socks

Unless you're short in a big way you've got to be happy with the market today. After ending up last week in god knows how long we are rallying again. It's even possible that we really into the close today. Even if you are short you have to rejoice, just a tad, in this pre-Christmas gift.

That being said this could very well be just a leg up before two more down. This uptrend will probably last into January and could see the DJIA reaching its resistance/support around 11000 and S&P around 1200. Depending on how we got there and how the economy looks in a couple months I think will be a good indication as to how big the next leg down will be. Be sure, there will be another downward trend soon. I am asking Santa to make it more of a flat trend while the economy realizes this isn't 1930. We have production and communication tools to get us back into the green faster.

Oh yeah, I should build some credibility so you don't think I'm a complete moron. I said last week that BAC was a market leader; today is a good example of that. They're up more than the other big financials on no good news.

By socks I really meant some articles you might find a laugh in over at Cracked.com:

The 7 Most Retarded Criminal Excuses of All Time


The 7 Most Ingenious (And Insane) Smuggling Techniques


7 Historical Figures Who Were Absurdly Hard To Kill

Bring It

I just read some article about Japanese graduates desperate for jobs. I have also recently received a letter from my university pretty much laughing at the possibility of finding an internship for one of my final terms. Being in the finance industry doesn't help much either.

Personally, I look forward to a challenge. I have developed myself socially, intellectually, physically, and psychologically throughout my life and will continue to do so as long as possible.

It's those other people that bug me. As Einstein once said,

"He who joyfully marches to music rank and file, has already earned my contempt. He has been given a large brain by mistake, since for him the spinal cord would surely suffice. This disgrace to civilization should be done away with at once."

A little bit too Nazi for me at the end, there, but I do agree. I think some tough times will force some people to think and fend for themselves. Who knows, it could be a good thing in the end. We'll see.

Berlin > Sandwich

So instead of going to eat a sandwich the last couple days, I went to Berlin instead. Didn't look at the market for close to two days. I expected to come back and see a huge drop (and hedged for such before I left). Imagine my surprise when I find that market has pretty much moved sideways from Tues.

Since the market didn't drop over 10% I feel like perhaps, as a bull, I might not be going directly to the slaughterhouse. Sometime I'll have to tell you about how I timed the market correctly to get from Citi to Morgan Stanley to Bank of America all with beneficial trades. This is because I believe BAC will be a market leader when this insanity is over.

Today

Today scared the shit out of me since I was looking for a tell into whether or not the market was headed for the door. I still have no idea, but I hedged a bit so that I am not so much net long. I predict down tomorrow to start, who knows during the day.

Down We Go

I'm mainly a long investor, and, liking the financials, today hurt. However I am like a foreign child that lacks self control; I am used to the beatings.

I think tomorrow will be a good indication as to whether we are to make new index lows within the next couple weeks.

Hey, on the bright side, the stock traders almanac says the best time to own stocks is from November to April by a far margin.

I will add again, Bell Canada will have to put in effort to f up at their board meeting and the shares are only looking more attractive with the temporary (god bless his little soul, he said temporary) downturn.

Did you know Benjamen Graham went bankrupt three times in his investing career? I found that encouraging since I am working on number one. I got nothin' but time, baby. Nothin' but time..

Go Go Blogging

You know they should change that word. Blogging. What a strange word. My suggestion would be to use the word 'record' in place of 'blog'. We could be recorders instead of bloggers. I know it ain't gonna happen but keep it in mind the next time they try to get you to accept some dumbass name.

Anyway I'm surfing around as usual and guess what? Blam! I notice that every other blog on the internet has ads and links and gadgets and feeds and all this other shit. Naturally, I feel compelled to add things like this to my blog to make it more interesting, interactive, and apparently you can bank some coin with ads. I don't think I will become that fortunate for a long time, if ever. It's not really my concern.

I'll add the other stuff in time. I'm not exactly an HTML wizz either. I mean I inserted a link into my last post and that was cause enough for a couple fist pumps. YEAH!

I like to entertain. I figure if I can do it in RL why can't I do it online? It's not my concern if I'm being laughed at or with. Either works. And was more entertaining than ranting about the stock market. Nadda. That's what.

I like pictures

The human mind naturally works better with pictures. This might help you remember the crisis one day.

Bells are ringing

By that I mean one bell really, and its not really ringing. I'm talking about Bell Canada (BCE).

As you may know the second largest leveraged buyout of all time stands to fall apart because the people over at TD and Citi managed to bribe KPMG into finding some fault in the deal (well that may not be true but I like to think they did anyway).

The good news is the shares are trading in a range that, if you think Bell has any economic moat at all, you might find yourself in for a deal. I know I did.

Disclaimer: If you buy BCE shares because of this post you are probably not mentally stable, and you may lose money.

Don't Hate

I listen to a lot of commentary from all over this world wide web and I heard something about a financial bailout and talks of an auto bailout or something.

It seems as though a lot of faithful citizens of the US are outraged that they have to pay for the mistakes of others. I haven't seen anyone mention that perhaps their inaction to educate themselves with the financial world is partly to blame. If everyone knew how much risky debt was being thrown around beforehand.. well too late now.

And that's the point: It's Too Late. However, the bailout of financial institutions is imperative for investor confidence. By that I mean credit. They let Bear and Lehman go under, you saw what happened. Now, Jim Rogers, who likes to use analogies a tad too often, thinks for America to maximize what it has left of global economic dominance, should take the bankruptcy hits like a man. He prescribes failure as the best and only medicine for the current economic blues. Jim, I don't care who you are most of the time, today you're an idiot. This isn't Egyptian times or whenever you were born, without credit, today's world will grind to a halt. Us, the passengers in this well-oiled machine that, of course, are not wearing seat belts will be thrown free from the wreckage into a lower quality of life.

As for bailing out the automakers I think there should be a compromise involving the automakers to actually show a business plan that has a slim chance of working. The financials have business plans that work as long as they keep their hands out of the metaphorical cookie jar. Ford and GM just found out last week that quality vechiles for fair prices exist. They might actually fit Mr. Rogers diagnosis of terminally ill.

Oh and don't confuse this Jim with Jim Cramer. Cramer has been a bigger idiot for a longer time. I dub him the idiot king for his calls lately.

Check the video:

Suck on THAT Bears!

My boots are tired from spurring bears aside the past couple days. Especially financial bears. I would like it to be known I like the financials, and my little money is where my mouth is. Oh and screw grammar as well, I end my sentences with propositions when I want to. So there!

But in all honestly folks, you might want to look at AMEX:UYG, NYSE:C, NYSE:MS, NYSE:BAC.
If you have big nuts, well you have to have big nuts to buy anything right now, but if your nuts are bigger than big, then I suggest you go for UYG or C. I would venture a guess that BAC is the safest of them and possibley the best VALUE (price/risk/reward combination). I like MS for the dramatic increase I suspect it will see when the world decides they aren't going to best the US gov'n and that the remaining financials will indeed survive and prosper in the coming years.

Random saying:
My stock advisor told me I shouldn't invest unless I was prepared to lose.
I told him he shouldn't live unless he was prepared to die.
It's war out here folks. Have a good one.

Predictions

What's a blog without a little speculation? Pretty boring, I'd say.

I figure I'll share some insights now and later they might be worth some credibility. There is no doubt in my mind that I am credible enough as it is but unless you know me well I have to prove it to you.

So, 2009 stock market predictions:

- We have seen the bottom (or damn well near it) of the market in Oct 08 with the record breaking VIX numbers

- Equity markets will recover more slowly than typical recessions

- The typical 3 month period of the equity markets leading the end of the recession will be longer as this is certainly not a typical recession. I would say 6 months -1 year or recession. And perhaps slower growth for a year after that.

If I think of some more predictions I'll throw em up.

Check It

Top 11 PERCENTAGE gaining days for the Dow Jones Industrial Average:

1. March 15, 1933 … 15.34%
2. Oct. 6, 1931 ….. 14.87%
3. Oct. 30, 1929 …. 12.34%
4. Sept. 21, 1932 … 11.36%
5. Oct. 13, 2008 …. 11.08% !!!!
6. Oct. 28, 2008 …. 10.88% !!!!
7. Oct. 21, 1987 …. 10.15%
8. Aug. 3, 1932 …. 9.52%
9. Feb. 11, 1932 …. 9.47%
10.Nov. 14, 1929 …. 9.36%
11.Dec. 18, 1931 …. 9.35%

I'm trying to find the cool graphs I was looking at the other day comparing recessions, bear markets, presidents, and year. I'll post it when I find it again.

They were right

Forget about listing those books, I thought about it and I think everyone should find the books on their own. The authors are listed, it isn't rocket science. Anyway they were right. The authors that is.

One thing in common with all the investment books I've read is that the author always makes it clear that this industry "isn't for everyone." They don't really say why and I didn't pay much attention figuring that whatever they were alluding to I could handle it. I understand now what they meant.

The stress. Managing money is one of the most stressful things you can do, you could even compare it to the job of a doctor; managing life. Ranking army officials and stock traders are said to have many psychological similarities.

Lately the stress of the market has been literally hurting me. I decided this is what I want to focus on for the majority of my life and put an immense amount of pressure on myself to succeed. My investment philosophy is long term, and with the recent market events you can guess how terrible my portfolio is doing. The stress of watching money that I can't afford to lose vanish into thin air is what they were talking about.

I can only imagine what losing other people's money or not being able to support a family because of a downturn in the market must be like. I'm glad I learned this lesson early and I understand now why rule number 1 is "Don't lose money" and why rule number 2 is "Remember rule #1". It is because the stress that rule saves you allows you to continue in the business and gives you the most valuable asset to any investor. Time.

I want to be an Investor

A big hello to all my non-existent readers out there (at the moment anyway). This is the InvestorWannabe deciding that is about time to start a blog. I feel like writing some of my thoughts down for easy access and I think that perhaps someone might find them useful. Or at least get a good "oh I feel sorry for that guy" chuckle out of them.

What you should know about me: I have recently taken an interest in everything money. Naturally this has led me to the equity and currency markets with more of a focus on the stock markets. I have been reading ass loads of great investment books over the past years that I will probably quote frequently. I like Benjamen Graham, Warren Buffet, Phil Fisher (although I don't care for Ken Fisher to be honest), John Templeton, George Soros, William Oneil, and Gerald Loeb. If you happen to be Canadian and know Stephen Jarislowsky or Prem Watsa (CEO of Fairfax Holdings) I'm a fan of them too. Reading all their books and being a fan hasn't made me squat. Yet.

I'll throw the names of the investment books I have read up next time. Everyone loves a good investment book, right?