I’m pretty sure this is the correct formula for divining the reverse stock split tick count:
R(X, z) :=1/2(X,X)z −1/2(X,X) =1/2N(X,X(z))2 − (X,X).
The quantity R(X, z) is always non-negative. It equals 0 if and only if z = DX, that is, if X lies in the line generated by X(z). Hence, for X 6= 0, this does not occur if Q(X) 0. Recall that for Q(X) > 0, the 2-form '0 KM(X, z) is a Poincar´e dual form for the Heegner point DX, while it is exact for Q(X) < 0.
See? Simple.
Ooooooooh, now I get it!!!
LOL!!!
At this rate they could VERY WELL end up at $5 again!!! THEN what are they going to do??? LOL!!!
Regards,
Dale.
That’s probably part of the reason behind the timing of the reverse stock split. They know that there’s quite possibly a beatdown coming to all financial stocks over the next while once QE3 ends and equities go through a decent correction. Even if they get knocked back to $25 or so they’ll still be an option for institutional investment and at $25 (or what was $2.50) Citi is probably a good buy if you don’t mind holding long-term like institutions do as opposed to the momo chasers and HFT algos. This might in turn help keep the stock somewhat more afloat during this period.
Hello.
Thanks for that. It makes total sense. Fortunately for me I am a long-term trend trader so holding on to positions for months on end is no issue for me. Besides that: the idea of buying Citi at $25 (assuming a trade signal from my systems of course) and waiting for the price to reach its ‘former glory’ sounds like a nice plan (although I doubt that type of thing is not going to happen overnight)!!! LOL!!!
Regards,
Dale.
Hi guys,
Just out of curiosity, do you have any idea why the stock would have taken such a plunge after the merge?
Hello,
Me personally: not sure. But I think PipBandit’s explanation is sound. Put another way: this latest bull rally in the (US) stock indexes started aroud March 2009 and although there’s been the odd correction along the way it’s been nothing major (other than the one day when the Dow fell 1 000+ points due to, I’m led to believe, some or the other algorithmic trading system that decided it was time to ‘sc*w’ everybody around) and it’s run up ‘hard and fast’ which, if you consider the state that the world was in in 2008 / 2009 is not, to me, logical because it’s been ALMOST a straight line rise in a relatively short space of time. And of course: all of these banks have their ‘connections’ in some form or another to the likes of Ireland, Greece, Spain, Italy, and Portugal and things are not looking to ‘rosy’ over there. My PERSONAL (and hopeful) opinion is that after whatever correction we may or may not see soon that the Dow is FINALLY going to 14 000 and beyond (which is where it was before its spectacular, almost straight line, decline due to sub-prime). But one has to wait and see. Following your trading system is REALLY the only choice that you have really i.e. going by what ‘the expert analysts’ tell you IS going to happen is a sure recipe for disaster.
And like I said on this thread: you’ll never stop learning in this business. For years I’ve been saying that you could not go wrong in buying Gold because it’s a finite commodity. Well I read something the other day that would never, in my WILDEST dreams, have crossed my mind!!! OIL and NATURAL GAS are finite commodities (eventually there just isn’t going to be anymore left). But GOLD, on the other hand, can be re-used i.e. smelted down and used again. So it’s by no means a finite commodity. In all probability it’s increase in price will be due the increased cost of extracting the metal but intrinsicly it really has no value. Just think about that statement for a minute. Gold in and of itself, other than the use in SOME electronic gadgets, really is not something that can be ‘used’. As somebody noted the other day: if you could go and buy Gold bullion what could you actually do with it other than have it on your mantlepiece (and in this country you wouldn’t even be able to do that i.e. if you don’t have the necessary permits such physical Gold would be required to be held by a bank). That’s not to say that Gold will not, in all probability, keep going up but it’s by no means a ‘done deal’. Now true: we may not run out Oil or Natural Gas in MY lifetime but it’s going to happen at some point let’s face it. And not only that: some or the other ‘genuis’ could possiby come up with a cheaper method of mining and extracting Gold and then what do you think is going to happen to the price (and the same could happen with Oil and Natural Gas)!!! I guess hence the ‘disclaimers’ on every broker’s website i.e. there’s no such thing as a ‘sure thing’ in this business and it takes somebody with MUCH more knowledge, experience, and understanding of the fundamentals, to process and understand this type of information to a point where it’s useful for trading hence my following ‘little dots and lines’ every day!!! LOL!!!
Regards,
Dale.
Sorry, I didn’t realise this was an algebra forum.
But what the heck yeah, you never stop learning. True.
Yeh well: I guess that’s what keeps it so interesting!!! LOL!!! Although oddly enough: trading in and of itself has become boring believe it or not and apparantely when you’ve reached THAT point you’re supposed to have reached a ‘pivotal point’ (and no pun intended)!!! LOL!!! Quite odd if you think about it!!! LOL!!! Don’t get me wrong; I still love the whole business but I no longer ‘besotted’ with it. Then again if I wasn’t at least profitable I’d probably STILL be jumping from trading system to trading system or ‘tweaking this’ and ‘tweaking that’ and I’d probably be ‘singing a totally different tune’ right now!!! LOL!!! What does concern me though (I have NO idea why I’m typing this i.e. I’m obviously in a ‘melancholy mood’ for some reason): it’s ‘come at a huge personal price’. Even if I did ONE trade TODAY that netted me $1 000 000 I’d still be on my own and miserable and have nobody to share it with and people, I don’t believe anyway, are not ‘built’ to be on their own. But again as the saying goes: ‘it is what it is’!!!
Anyway: that’s depressing!!! Let me go look at some charts!!! LOL!!!
Regards,
Dale.
Hi Dale,
I’m still very enamored with trading, I don’t think that’ll fade away for a while; but I think I’ve kind of hit a learning wall. I need to move on to something new and I’m certain I either need to learn from my mistakes as you did or maybe get myself a mentor. At this point I’ve tried countless techniques/methods/indicators and I don’t think I’m getting any further now… did you reach a point like that at any time?
As for the end of your post, very depressing. It was practically a public pity party! But I can still understand, everyone feels that way at some point and being alone is not ideal. virtual hug
Good morning,
public pity party!
ROFLMAO!!! LOL!!!
It wasn’t meant to be I assure you. As I said: I was obviously in a ‘melancholy mood’ at the time but it passes. That being said and my personal situation aside this CAN be a very lonely business EVEN IF you’re with someone. You’re ‘average partner’ will NOT understand the losses or the frustration and as I’ve noted a few times before somewhere around here: ‘generally speaking’ when you’re making money you’re a ‘trader’ and a ‘hero’ but when you’re losing money you’re perceived as nothing short of a ‘down and out loser’. I’ve thought about it often: sometimes I think the ONLY partner a trader can have is another trader and, unfortunately, having an ‘unblemished lifelong record of heterosexuality’ (George, Seinfeld), my choices are very few and far between (actually NIL)!!! LOL!!! Being a floor trader on the other hand: well that’s different of course. There you go to the floor every morning and there’s a ‘bond’ that exists i.e. it’s a a sort of '‘gentleman’s (dangerous animals???) club’ (which may or may no have one or two female members) where everyone has common goals and a deep understanding of the inevitable ‘up and downs’ of trading and even although one trader will just as soon slit your throat as buy you a drink if you got into a good trade which they missed: that ‘bond’ will remain intact. Unfortunately: the trading pits are dying I’m led to believe. And I could just imagine that after a day in the pit you would not WANT anybody around when you got home!!! LOL!!! (Oh and thanks for the virtual hug)!!! LOL!!!
Anyway: NONE OF THE ABOVE is going to help you in your quest to become a profitable trader!!! LOL!!!
We have ALL reached the point that you feel that you have reached at some time or another (and some of us have reached that point MORE than once let me tell you). In my case though: I had ‘the answers’ right in front of me ‘from day dot’ and just didn’t realize it until ‘losing the farm’ as it were. By that I mean: my main trading systems and the ones that ‘pay the bills’ are the EXACT same trading systems that I started with. But of course: they, like any other trading system, do make losses too. Unfortunately (and this is just a ‘human thing’ as I NOW understand it): two losses in a row and ‘we’re off’ to try the next indicator or the next trading system and of course this cycle repeats itself over and over and over again until you either give up or are ‘stone broke’. What happens at THIS crossroad is what makes the difference.
You probably have not seen them but I’m in the habit of posting links to articles that I like to refer to as ‘golden nuggets’ or ‘gems’ (I have to ‘cherry pick’ them from under a mound of daily junk emails received) that I hope will be of help to others and just yesterday I received one (which I’m going to post on its own thread as I usually do) but I’m including it here for you now:
It describes, in far better detail and in a far more elegant manner, the scenario that I’m describing above (there’s some pretty good links within the article itself as well by the way).
Unfortunately though: as valuable as that information may be it could very well be construed as ‘psycho babble’ (and there’s LOADS of that around which really is useless if you don’t have a decent trading system). The theory and the practice are two different things.
But this brings me to a point: to be honest I’ve been looking for an excuse to post something along these lines and, for better or for worse, you’ve provided me with just the excuse I was looking for. And let me make this VERY clear: NONE of this is directed AT YOU PERSONALLY so please do bear that in mind.
Just this past week (or two maybe) there’s been one or two (or more) threads that have been started by new traders who are having a hard time with their trading and ALSO appear to have ‘tried everything in the book’ without success. I may have responded to one of those threads but for the most part I read them, read the responses, shake my head, and move on, because I know that nothing I say is going to be taken seriously. And I know what the problem is: it’s my ‘association’ with my broker that’s the problem. WHY that should make ANY difference ‘I know not’. My broker didn’t develop my trading systems. I didn’t develop my trading systems (all I’ve done is apply the ‘odd little tweak’ to one or two of them is all). They were developed by ‘market masters’ and professional traders (at least one of which has retired with millions made out of this business using those same systems). In other words: my presenting my choice (basket) of trading systems is NOT designed to get people to open accounts and ENSURE that they lose money. I SIMPLY follow the trading systems. I mean to say: they’re ‘right there in black and white’ on my forums and as a matter of fact there is an ENTIRE THREAD, actually TWO, right here on BabyPips, that went on for THOUSANDS of posts and some valuable contributions were made. The only DIFFERENCE being that we ALL failed with those same trading systems detailed here. IN HINDSIGHT: it was not the trading systems. It was all of us. We all got so ‘caught up’ in the calculations and the ‘where and why’ and with AUTOMATED BACKTESTING (which ironically was the MAIN reason why we all failed i.e. AUTOMATED BACKTESTING showed dismal results BUT PAPER-TRADING those very same systems, which is what I spent at least a year or two doing after my ‘spectacular wipe-out’, painted a VERY different picture) that we ‘couldn’t see the wood for the trees’. Had we all JUST TRADED the darn systems we’d ALL have HUGE trading accounts by now. Alright and to be honest: small changes and a deeper understanding of the texts (some of the information, for example, in Wilder’s book can be difficult to interpret and very easy to misinterpret) was necessary unbeknown to us at the time but EVEN just following the signals given in SPITE of some misunderstandings would nevertheless have resulted in huge and SUSTAINABLE profits. All that work has been now DONE by me but sadly: the moment anybody sees the words ‘trader’ and ‘broker’ in the same sentence then the assumption IS made that all this person is trying to do is to get new traders to open accounts to ‘prey’ off of their trades (commissions). And while it IS true that an Introducing Broker will make commissions on trades, win or lose, what a lot of people DO NOT realize is that it is NOT in the interest of either a broker or an Introducing Broker for traders to lose their accounts (well: not unless you’re talking about the ‘bucket-shop’ type broker whose business model relies SOLELY on the losses of traders and as such has to keep ‘topping up the pool of new traders’). Once a trader has lost their account there is NO more income for either the broker or the Introducing Broker and let me tell you: soliciting new clients is a DAMN difficult job given the amount of competition out there. In other words: it’s a whole lot easier (for somebody like me anyway) to have a handful of clients that are growing their accounts steadily, thus their trade sizes are increasing, and so is my income from their trades. That’s one HELL of a lot easier than constantly having to replace ‘wiped out’ accounts with ‘new fodder’. And yes: my ‘loose arrangement’ with my broker is, very soon, going to be just a tad more ‘official’ than it is now and, unfortunately, I’ve a feeling that is going to curb the amount of DIRECT advice I can disseminate (although I’m not quite sure of this actually e.g. IBFX THEMSELVES is ACTIVELY marketing an EA called ‘BURU’ which can be seen very clearly in the banners on this very site at the moment and if that’s not giving DIRECT advice then I don’t know what is so I could be wrong on the ‘legalities’ or the ‘ethics’ of this).
Aside from the above (my ‘bitc*ing’): I see answers to new trader like ‘learn to recognize support and resistance’. I mean: WHAT help is that to a new trader??? I’ve been ‘at this’ for the better part now of six years (I think) and even I cannot just ‘off the cuff’ recognize support and resistance (well: I sure would never open a trade based on what I PERCEIVE to be support or resistance). This advice is being given by people who have been ‘at this’ for YEARS and, obviously, have the confidence and the (one can only assume) the proven results to be able to trade of support and resistance levels. And no offense is meant by this to anyone I assure you.
Another one: candlesticks and chart patterns. OF COURSE they mean something IF you have the experience and the understanding to be able to trade off of them. But as has been addressed on at least two threads this very week: NOT ALL CHARTS in spot FOREX are the same (the four-hour and daily charts will differ, sometimes greatly, depending on the time that your particular broker closes their daily charts). So some well known ‘strong’ signals e.g. ‘bullish engulfing’ or ‘bearish engulfing’ or ‘inside days’ or ‘outside days’ may be apparent on ONE chart at a particular broker such may NOT so apparent at another broker. ONLY ONE can be ‘right’ theoretically. And I’m not going to ‘go on’ again about my equity futures and commodities vs. spot FOREX trading. Even I am tired of that ‘mantra’ because it ‘falls on deaf ears’. I have to (hate to???) admit that I’ve been ‘testing the spot FOREX waters’ again of late with my choice (basket) of trading systems and, well, as I noted on another thread somewhere, I didn’t ‘put two and two together’ i.e. after my ‘spectacular wipe out’ I stopped trading spot FOREX and started PAPER-TRADING and then trading equity futures and commodities and it was easy, of course, to make the assumption that spot FOREX was therefore the problem. What I DID NOT realize though (and this was the point I was making on another thread): is that I MYSELF had learned some very hard PERSONAL lessons. What I am NOW saying is that the same systems, it would appear at this time ANYWAY, CAN be profitable trading spot FOREX IF the same rules are applied e.g. risk and money management and ‘patience and restraint’ (see my link above again)!!!
Anyway: all of the above is (as usual) my ‘long winded’ way of saying that you need a decent, tried and tested, (and YOU YOURSELF need to ‘try and test’ it), trading system and JUST TRADE IT. Don’t make the mistake that I KEEP trying to tell people not to make i.e. ‘information overload’. I can tell you the ‘ins and outs’ of what happens overnight when the markets close and what happens at settlement and what has to happen before an exchange can open the next morning and the ‘checks and balances’ that are done at after hours. Has that type of in-depth knowledge made a single $ for me??? NO!!! NOT ONE!!! But my simply following a set of ‘black and white’ rules (trading systems) most certainly has. OK: maybe I’m NOT as ‘bright’ as I’d like to think I am. Maybe I ‘don’t have what it takes’ to ‘see’ support and resistance or ‘feel’ the markets like others. Put it another way: I KNOW I could not take a blank canvas and produce a masterpiece (painting) but I KNOW I have the wherewithal to complete a ‘paint by number’ picture. And, for better or for worse, that’s the only way that I can trade no matter HOW much superfluous but interesting knowledge I have of the markets.
One last thing: the type of person (trader) that you are IS important. Me: I’m happy to take a cursory look at the charts once a day, move stops, place orders, and then walk away (hence my daily boredom). Others: couldn’t live with that i.e. they need the ‘action’ (shorter timeframes, quick scalps, stuff like that). Both ‘styles’ have their pros and cons. The latter has never worked for me and only ever cost me money but that doesn’t mean that I’m right and short-term traders are wrong. It’s just a matter of what has worked for me and what I’m able to live with. Long-term trend trading: I can help you. Short-term trading: there’s only one or two of my trading systems that work SOME of the time on the shorter timeframes (1-hour and less) and even then the profits made, I don’t believe, are worth the effort. So other than what I’m able to offer you (or anybody else for that matter) the only other possible direction I could point you in (for short-term trading) is to take a look at some of the stuff by ‘purplepatchforex’. AND NO: I’m not ‘big buddies’ with him or anything like that. It’s just that aside from myself: he’s the only one that’s been VERY SPECIFIC about how he trades (so please: NO offense is meant by this to my fellow ‘Honorary Members’ and experienced traders i.e. it’s just that I don’t know the specifics of how you all trade is all). Or: you could ‘mosey on over’ to the threads called ‘Technical Templates’ or ‘Technical Templates Continued’ (something like that) but that stuff, once again, is WAY ‘over my head’. ‘Tess & Co’ obviously have the wherewithal to ‘see’ things or anticipate things that I don’t but I’m led to believe that they’re a professional group of traders. As I said: no offense to any of my ‘old buddies’ here i.e. it’s really that I just don’t KNOW how you trade otherwise I’d be ‘pushing people’ in your direction too (people that need more ‘action’ and can be profitable)!!!
Regards,
Dale.
I leave you with this investment (trading???) quote:
“Investing should be more like watching paint dry or watching grass grow. If you want excitement, take $800 and go to Las Vegas.” - Paul Samuelson
Taken from this list (the above being one that stood out for me):
Learnings and success go hand in hand.
Yesterday EYX hit made me earn 5.6$/unit, the same unit, made me lose 9$ a week back.
Playing Short kills too… 
and thats the my learning for the week
Regarding gold. Yes it has an intrinsic value. One very rare value: Politicians can’t print it and ceos can’t tune it! That’s why au is the real money. Have you ever asked yourself why all important central banks own gold? It’s the best piece to store work compensation in uncertain times like now.
There is a nice article about the real function of au:
The Truth About ‘Investing’ in Gold - Seeking Alpha
Regarding oil: There will be a time when oil doesn’t matter anymore. If new generations of batteries will hit the market. Those batteries can be produced right now in laboratories. They can store 10 times more energy than the best batteries right now. Same weight and size. In 5-10+ years they will hit the market. With those batteries the transportation system will use more electric engines. This will not be a cut in oil over night, but the importance of oil will fade away. This will not only change the transportation sector, but also the geopolitical situation. Until then there is enough oil there for everbody. Particularly if you realize that there is an end of consumption of oil in big quantities in a decade or two. Coal was the major energy base for a long time and now look how that has faded away. The same will happen to oil. No, I’m not that guy believing in the new energy hype. Even electricity for batteries has to be produced. But if you have electricity as major energy memory, then you are way more flexible how you would produce it. You can use solar energy, nuclear energy, oil, coal, whatever you like.
Look at the silver prices of the last 5 years and you might get an imagination what will happen to gold in the next years. I am “all in” since 5 years. There is not any other long spec major asset in this world which has beaten those commodities in the last decade. It’s a super bull market and only a few have recognized it. Most people tell it is too expensive. Which is another sign that this is still a market for the smart money right now. Buy as long as it’s cheap. :5:
Good evening Mr Gecko.
This part I love:
Thank you for a very insightful post (and the link).
Unfortunately: it’s that type of insight and understanding that I lack (hence my ‘little trading dots and lines’). When it’s EXPLAINED to a person as clearly as you have it just seems so logical and yet it’s not something I personally would be able to piece together logically in my own mind (your ENTIRE post I mean).
As a matter of interest (and on the subject of energy): what is your ‘take’ on Soybeans / Corn / Ethanol / Diesel (Bio Fuels) ‘matters’??? One of the first commodities I started watching (even right in the beginning when I was still trading spot FOREX) was Soybeans and MAN can the price move sometimes!!! But (as you know): I would be talking long-term here???
And if you’ve been ‘all in’ since 5 years!!! ‘Respect’ is the only word that comes to mind. I know one person who was ‘all in’ (Silver) since the lows of 2009 and closed out just the other day RIGHT at the highs of last week (or the week before it may have been i.e. right before the huge correction) and I have to say I’m very jealous BUT very proud of him (he’s a good friend of mine and used to hang out here quite a bit until HE TOO ‘got wise’ regarding spot FOREX trading and, well, his results speak for themselves).
But once again Mr Gecko. Thank you for the post.
Regards,
Dale.
Ur very welcome, dpaterso! My pleasure! I can also thank you for your isnights! A lot to learn also to me.
Well, I just write a little about what I believe to know. On the other side, the results seem to back up my long term strategy:
If you know that to dig for gold takes around 800 usd one ounce right now if it’s cheap, you also know that gold is not in a bubble right now. It’s ridiculously cheap! Sure, I wait for dips. Particular as I am “invested” already. Just talking about the big pic. Another thing is if you look for how much au was worth 100 years ago. You could buy 35 bucks for one ounce of gold. So, there you can see that over the long run all fiat money will inflate. Deflation is a buzz word, but nothing more. I have a lot of research here to back that. Just one example: If deflation scenarios would work, why then are all ppl buying computers and cell phones like there would be no tommorrow? We all know that they will become better and cheaper. Why are those folks buying it and don’t wait and never buy something, all know it is something you can get cheaper tommorrow? Because people want to use those things. And that’s why all the classic deflation scenarios make no sense at all! Sure, you can have dropping prices, but that has nothing to do with deflation. I even doubt the circulating big deflation explaination of the thirties last century. Why the heck is selling assets for profit or because of fear deflation? That’s BS! If banks are eager to sell credits, that inflation and no bank is not eager to cut their credits, because that would mean the bank would go out of business. Right now even the politicians started to back up the banks and to sell more and more credits. We all know where this is going to: More and more inflation. Sure, not a straight line as no line on a chart is straight, but over the long run there is no other solution to decrease those debts of the world. There will be inflation and more inflation. That’s the only solution what works in every Kontratieff cycle.
Regarding wheat and soybeans and pork bellies and all that I am afraid that I can’t give any suggestion here. I once worked for a guy who did invest in that stuff around the world. So, from that time I know sitting behind a computer screen is likely not enough to be profitable in those assets. He always travels around the world, looks at the farmers land, how the corn smells, is digging in the ground, looks at weather predictions and so on. So, in one word, he is a specialist kind of and I have no clue whatsoever what he buys and sells and why. I mean, I have a big picture, but I couldn’t tell anything about details. I’m pretty sure he could, but he won’t. He has a small company and other guys who trade for him. All behind the curtains and confidential. From him or his business I just learned some things like hedging and that stuff.
Then there is the point that it’s better to have not too much assets in your portfolio. I go with Buffet in this case. If you can have a few single very profitable assets, why would it make sense to diversify too much? You would have to widen your work and analyzing and so on. If you can just pick the best assets that would be “good enough”. So, I am more focusing in tech stocks, pm stocks, pm’s, currencies and that’s it. I’m also looking for other major indices, but just to get an idea what is going on, not to invest in those particular stocks or indices. So, I can tell what’s the dow, dax, interest rates, usdx and yes I have also soybeans at my radar, but just for wondering what is going on there and shaking my head to not get rusty, lol.
Once again: ‘splendid’ and thank you.
It would seem that ‘the Ben Bernank’ is great to have around if you’re looking to get into the property market!!! LOL!!! (I don’t know if you ever saw that YouTube link that I posted about QE that was sent to me by Larry Levin i.e. YouTube - Quantitative Easing Explained. The funniest parts to me and that made me laugh the most were the references to ‘the Ben Bernank’ and ‘the Goldman Sachs’)!!! LOL!!! It’s quite old though so you’ve probably seen it!!!
Oddly enough: OUR currency is still based on the Gold standard but then we have a government that has the knack ‘negating’ the Gold price!!! LOL!!!
I get a commodities report every day from the CME and I have to say it’s pretty detailed but again: it’s information that I have a hard time translating into trade ideas but I read it now and then nevertheless.
My question (to you) was more along the lines of what IF Bio Fuels became, sort of, ‘the thing of the future’. Obviously the question is (and what would interest me): is what would happen to the prices of the likes of Soybeans and Corn. But that said: I’ve read many an (dare I say ‘interesting’) article where there’s been controversay as to what the effect on the availability of the most basic of foodstuffs if the demand for Bio Fuels, and therefore the crops required, would take presecence over ‘the feeding of the people’ if that make sense. Then again: it could be a GOOD thing for poorer nations (especially most of the African nations i.e. they could ‘get off of their butts’, stop fighting over elicit diamonds and oil, and grow their own crops that may ‘fetch a pretty penny’ at the market)!!! But as I said: I don’t consider myself a dumb person by any means but I’m definitely more of a ‘techincal’ person so my making sense of some ‘macro economics’ and ‘fundamentals’ is a bit ‘stinted’ (to say the least)!!! LOL!!!
Regards,
Dale.
Forgot that, so good evening Dale!
Well, I come more from the fundi side, lol. Not to say I worked a little at the technical side too, as all my bots are just technichians, lol. The point what I always asked myself my whole life is which party to vote for and even more important WHY. Then, one evening 45 years later or so I got it: No matter what you vote for, politicians have their own party which would never vote for the public party, lol. So, right now then I vote for myself and my assets. That’s why I started investments in pm’s and currencies. Anywhere I red the quote that all ppl investing in currencies never trust the governments. That’s why they invest in currencies. I don’t know if that is true for everybody, but for me it is very true.
That’s also the reason I do not trust in statistics from governments. I don’t know if this is just my own observation, but if stats come out sometimes price is doing exactly the opposite what was expected if all stats would be right. And then that’s probably also the reason why technics play a better role than tuned stats. Take for example the inflation stats. They have a basket and define what’s in the basket. So, the inflation stats are not an inflation stat, but a basket stat. Showing the price of the pieces in the baskets, lol. Then there are jobless stats. But it depends at what qualifies as a jobless worker. In Germany they found ways to just pay one euro for some jobless people to get them out of the stats. Now we have here a lot of a million one euro job workers. So, the jobless stats seems to be more the “how good did the politicians tune the stats” stats, lol. So it goes on and on …
At least: If I just hear all the empty promises of politicians (not them only, but they are perfect in it) and the lies I start running. So, since a couple of years I am well aware that I can’t trust those folks but to have to do my own math. That’s when I started to look at old gas bills and calculate inflation for myself. You know what? 7% was the inflation of the euro in the last decade. Despite all gov stats came up with 1 or 2%. Those bills won’t lie. That’s a whopping 50% loss in a decade. People can see this also if they go out for dinner. When the euro was invented as cash, most restaurants around here left the price the same and just changed the currency. When people claimed that, the politicians talked about “feel inflation”, lol. As if it wouldn’t be real.
Well, I have no idea how it is going in this decade with energy. In the second ww in Germany they used cars fueled by wood. That was just a temporary case, though. The other problem around lingers with those growing fuels as the more expensive those grains become the more expensive food might become for third world countries. And if we are speaking about Africa, particularly Northafrica, they have oil and everything and it didn’t help them to become really developed countries. The problem there is they have too much religion and that’s their law. So, them are more living like myself would classify as stone age. I visited Egypt and looked with my own eyes what issues are there. Not knowing this time what was the reason for the malaise. I learned later. No, I do not think they would profit from something like an asset. Just the mighty governments or/and families would. They would and will use the power to make pressure on the public and keep the poor poorer. Not to say I’d greeting something else. But investments has nothing to do with wishful thinking. So, I guess every dollar “investment” in those countries are not a good investment for them. I also red something about African leaders who said they don’t like subventions from Europe. Because that’s a competition to their own farmers and they will then lose the job. What ever is going in Africa and elswehere of poor countries they must help themself. They can only become better if they invent their own development. That might take more time than I could observe.
As I said, I guess if the batteries in 5-10 years are ready the western world will make a significant shift to a new era. That’s nothing what will happen over night. So, there is a lot of development involved then. Also computers which then will control the engines even more than right now. We have a small electric car here. That’s like a big golf cart. It drives fair well in the city. Very good for shopping. I mean, I have my big SUV there in Texas, but for here it’s nice to don’t pay a lot of insurance and tax. This small car takes costs just 1 euro for 100 km. That’s way cheaper than gas around here and even cheaper than gas you would have to buy in Texas. The only problem is the range. After 60 km or so you would have to recharge. So, if batteries become that powerful that a car has a range of say 500 km / 312 miles, then it’s just a matter of a few years until most people will change to electrified cars.
Good morning,
Once again: I cannot thank you enough for your input and for going to the time and taking the trouble with your posts here.
To be honest: I feel rather ‘inadequate’ (which doesn’t happen very often as I’m sure you will already know) when replying to your posts such as these!!! LOL!!!
But I can add some ‘laymans’ comments which are rather befitting to at least SOME of the contents of your post.
For one thing: your ‘take’ on government statistics and calculations are ‘spot on’ so far as I can tell. Let me explain. We have a national radio station here that has a two hour show every early evening for two hours and this show is dedicated to the business of investing and ‘all things finance’. AND JUST THIS LAST WEEK they have had two economists on the show as well THE person who heads up whatever government department is responsible for coming up with our inflation figures and CPI and all the rest. And the presenter (host) was trying to get ‘in laymans terms’ from these guys WHY THE GOVERNMENT is saying that our inflation figures are well below target and that everything is going SO well with our economy and yet ‘the man in the street’ is getting FAR less ‘bang for his buck (ZAR)’ than ever before. These guys were also talking about this ‘basket’ of stuff that they take into account to calculate these figures and, even with my limited understanding of such things, it all sounded like a bunch of ‘BS’ to me and I have to say that the presenter (host) of the show pretty much said as much to the guy from government. The bottom line of all of this: no matter how well our economy is doing according to government statistics the man in the street is seeing (and feeling) a totally different picture.
As far as energy is concerned (and battery operated cars): I saw a documentary not too long ago that was called ‘Who Killed The Electric Car’. YOU probably will know about this (I didn’t until a few weeks or months ago) but GM built a few hundred electric cars and then, one day, for no APPARENT reason, (just about) FORCIBLY recalled all of these cars from their owners and ensured that they were destroyed. To the best of my knowledge (well: according to the documentary) only ONE exists and that is in a museum with all the technology removed from it. I guess it could be found on-line to watch. Here’s just one link that I found using the search phrase ‘who killed the electric car’ in Google: Who Killed The Electric Car? | Watch Free Documentary Online (but it’s only the introduction or preview). Basically (and whether this be a conspiracy theorist’s dream or not): the way this whole thing was handled by GM AND by the politicians does (did???) raise some interesting questions and was appeared very ‘suspect’ to say the least!!! I guess what I’m saying is that do you believe that things have changed THAT much now??? The argument BASICALLY being that between politicians and the big oil companies they have NO (financial) interest in promoting cars or vehicles that DO NOT require fuel (oil) to run. As a matter of fact (I’m forty-six next month): I remember my science teacher telling me when I was at school (and obviously that was a good long while ago) that the technology even back then existed already to manufacture a car battery that would never need replacing (you know: not for an electric car but just a normal car’s battery) but that such battery would never be manufactured for obvious reasons. Whether he was right or not who knows. I’d actually be really interested to know how many patents and inventions have been registered or bought up by some of the huge energy companies that will ‘never see the light of day’. I’ll bet there’s more than a few.
Africa: well let me tell you that most of the world (in my opinion anyway) has a very ‘skewed’ perception of most of the Sub-Saharan African countries. I don’t want to get into such a debate because I can just imagine the possible fallout but let’s just say that, for the most part, they’re all ‘their own worst enemies’ and there’s a ‘culture’ of ‘give me’ rather than ‘I’ll work for it’. And the ruling parties in most cases only have their own interest at heart but are probably the greatest ‘marketers’ on the planet. We’ve just had local elections here and of course the ruling party has won again but based (in my opinion) only on promises (the same promises that they’ve been making for years now). ‘Service Delivery’ (or lack thereof) has been the ‘theme’ of these elections here. The ruling party says that ‘they’ve delivered’ and will continue to do so. As but one example (given by them): they HAVE ‘delivered’ i.e. ‘just look at the beautiful tarred roads that we’ve constructed in areas where the previously disadvantaged never had tarred roads before’. But they’ve missed the point I think. Now these beautiful tarred roads exist in these areas but the people don’t have jobs, houses, or food, let alone cars to DRIVE on these beautiful tarred roads. That type of thing. Anyway: that’s a slight ‘digression’ but my point (coming back to Soybeans and Corn etc.) was that Africa has enough space and resources to produce this stuff and I was just thinking that for the ‘poor and downtrodden’ that have a piece of land and if Bio Fuels became ‘the thing of the day’ well, then, they could sustain themselves with their own crop. That type of thing. But reading that statement I GUESS is rather ‘idealistic’???
Anyway: once again thanks for the posts and the insight.
Regards,
Dale.
Good afternoon Dale!
Again, ur very welcome plus my pleasure! Not often to see somebody with an open mind and same time based on the ground of reality. Particularly in this business, lol. Very nice to discuss something with you and definitely no “trouble”.
Well, I am a master of economics. I’ve studied business economics. Then I am since 30 years or so engaged in IT business. So, just that you know where I’m coming from. So, whatever I look at, I also look to get insights in the logics of such things. Plus I worked for several years in a big regional bank, so I believe to know what I’m talking about.
If you look at the economy, then gas or oil is like the blood of the economy. You need gas/oil for everything. For production, transport and energy purposes. That’s why I calculated the gas bill inflation and I guess it’s the best inflation indicator today what you can have. Because even if you buy a bottle of milk, you pay for gas. The milk has to be cleaned with oil energy, transported with gas cars and so on. Every product what you can buy has “oil” in it, lol. The bad news is, that as business owners we have to collect gas bills. The good news is, I could use then the old bills to calculate this cpi of my own. 
In Europe it’s exactly 100% more than a decade before. So, in around 2000 I paid 1.60 DM for one liter and now I would pay 1.65 Euros. Which gives a 7% annually gas inflation over the last decade.
Well, I must say sorry for to write “inflation”. Inflation in itself is defined as “growing money beyond growing goods”. So, my inflation term is a little decoupled from that definition of old school of economics. However, it’s way closer at this inflation term than all baskets, lol. The point is: The politicians can put whatever they like into that basket. For example: If pasta become too expensive, they can substitute that by rice. If rice is cheaper. Then they put in the computer in the basket and say: “Hey look how much deflation we have if a computer costs just 500 today and 5000 20 years ago”. Not saying, that this is related to Moores law and not any inflation issue. You can see the big pic? They tend to put in the basket what’s cheap and pull away what’s expensive. So, the government then can say to the voters: “See, if you vote for us, then inflation is no problem”. While the man on the street just shakes the head and looks at his gas or restaurant bills. And so it goes on and on with statistics and politicians.
This radio show however is a good example that you have still a “press” right now which is somewhat liberal. In Europe they try now to censor everything what doesn’t fit into the left wing picture of a nice, peaceful, growing economy with more and more tax on tax on tax. Just the internet is a media right now here where ppl can exchange information not filtered by the press. That’s why I do not look anymore at tv here.
In the US its not as bad. But still DC, which is with the current government now more a long arm of the european socialists tries to focus on tax increases and heavy spending. That’s why I believe the usd will still have problems as long as there is no return to better household management and debt increases. Mr. Geithner is now looking to get that 15 trillion debt ceiling out of the way to make more debt. That says it all.
Then about Africa: Yes, I guess I know what you mean. I was in contact with an investor in Cape Town for a while and he described the situation there. It seems that all this new hype of everybody has the same rights and so on is not going to work. As you described already with this “going to get something” instead of “working to get something”
The core issue is socialisms. If all people only try to “get something” and nobody is left who “works for something” then there will come the time where there is no more anything to get. The joke of the history is that everybody can see this if he just would look at the eastern world like say UDSSR. They had socialism/communsim and it was a big default at the end. Now politicians come up with the same old story of all are equal and government will do everything for you just in other “colors” and people fall for it again.
So, as investor and even for my life it is clear that I do not want to become any government too powerful and I believe most governments around the world are already too powerful. People get lazy if they have some freedom, not knowing what real liberty could be. The end of this game will be a harsh collapse. Reality and markets are the truth and they will win over nice buf foolish dreams. Somebody hast do work if somebody want’s to pay. That is what I recognized five years ago and that’s why I bought my gold that time.
