July 2006

I named this post because of the Peter Principle, which essentially states what the link says it states.? I was reminded of the mention in Running Money of the fund managers who, when they reached a goal for rate of return,?took windfall profits and sat on them so as not to miss their targets for the month.? So my question is, should an investor call it quits during a given timeframe if they hit a good run and, if so, when and for how long? (more…)

It’s hard to be bearish with this kind of information hitting the wire.? If the market really is a minority game, then forget a bear market for now.? Looks like today’s action would agree.? But then again, bear markets?have the biggest up days.? I’m curious to know now what other sentiment indicators are saying.? One?lemon does not a fruit bowl make.? Also note that as of my writing this, the Dow futures haven’t exceeded the infamous 11087 level from my density chart.? This means that there isn’t yet a change in value to the upside but mearly a retreat TO value, for whatever that is worth.? This pretty much leads one to the conclusion that nothing that has happened in the past month has been anything other than pure volatility with value never really changing from 11087 or so.? So where are all the voices crying for “Neither” in the bullish/bearish debate?? Perhaps volatility should be redefined to mean?”a period of?strong opinions, weakly held”.? Until August rolls around, the best investment advice might just be sell above 11087 and buy below it, ‘cuz we ain’t movin’, Jack.? Or perhaps you could make an option play.? There is probably no better spot that these high value areas for initiating a market-neutral?option position since they are?essentially?epicenters?of activity.? But before you do anything rash, please read my disclaimer.

Oh, Vic, Vic, Vic…Damn, Son!? What the…!?? What are we gonna do with you?? The sawnbitch gone an done it agin.? Goes to show you can talk a good talk and have lots of great things to teach but that won’t necessarily translate into a good game.? Take what you can that’s valuable, make it your own and walk…no…run away.

I’ve always thought that?animation was sorely underutilized as an investment tool.

I have never made money in the markets.? If you follow my advice, that is akin to strapping on a a piece of fishing line to your ankles and trying to bungee jump off a 1,000 foot bridge…..? (more…)

Just read this great quote from Inside the House of Money (p. 205):

We are playing a variant of the Greater Fool theory which should be called the Slower Fool theory. According to the Greater Fool Theory, investors buy things [at inflated prices] on the hope that they can find a greater fool to sell to.

Following the Slower Fool Theory, …my plan …is to be faster than the other fools holding [similar positions] and liquidate before the oncoming Armageddon devastates them… To the extent that everyone believes the crisis is sometime in the future and somebody else’s crisis, the game is viable. (more…)

Ok, as promised, a primer on density profiles or meta-MarketProfiles or whatever you want to call them.


As soon as I saw the chart in Jason’s post, I could tell there was a profile story there. I’m getting better at “seeing” the profile in a barchart. Here is the 90-minute profile for copper futures:



The old cliche is that Copper is the only metal with a PhD.? “Copper earned its useful nickname “Dr. Copper” over the years due to its ability to forecast the state of the economy and particularly the ebb and flow of the equity markets.”? (From the first hit I found on Google.)

Today it looks like it’s telling us something a bit worrysome… (more…)

In case anyone caught last night’s Daily Show, Samantha Bee interviewed a guy named Kevin Kerr in her segment called Hurri-Cash. She mocked Kerr (a commodities trader) and a guy who runs a gambling website for profiting and being excited when hurricanes hit and cause devistation.

To be honest, the piece didn’t mock Kerr as much as the situation in general. The funny thing is, I’ve read Kerr’s work in the past and he is (as portrayed) very market oriented… You can read The Daily Reckoning or Investment U, both of which he sporadically contributes to. (more…)

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