Early Retirement Extreme Forums

Dragline wrote:It appears the best way to trade is going to be front-running his tweets with options, at least for those on the inside. BA was down 1% at open due to this morning's missive.

hmmm https://twitter.com/AmichaiStein1/statu ... 1616918528

edit: related x-post in trade log thread:
viewtopic.php?f=3&t=1323&p=133113#p133113

bryan wrote:operation pump-dump Trump continuing.

bryan wrote:My gamble will be to take some short term profit on this Trump president-elect market after thanksgiving and then make a few bets that he will not win the electoral college. The big unknown in this scenario is who (3rd place finisher) do the GOP faithless electors want to put to the House to be chosen over Trump? Also there would be the air of uncertainty with Trump losing and if the 3rd place man is not a clear favourite going into the House.

dump stage now full swing. Looks like I was a day (weekend) late for some picks. Many potential candidates, but for today I:
sold CCJ, CNQ, XME, OIH, GM

Another Trump strategy I am considering is doing the opposite of what people think Trump means. e.g. He thinks the F-35 is too expensive so LMT dropped a bit.. but he'll probably come out in a week saying "Hey, they are way better than Boeing; giving them a HUGE contract. Made a deal for more jobs!"

https://www.youtube.com/watch?v=xeKSimdqpHo

In the Trump meeting with tech execs, it sounds like Trump is going to be very happy to listen to Thiel.

Mentions: the stock market, wants to help you folks (the biggest market cap companies in the world.. maybe better enable them to deploy there overseas cash?), will be there for you, no formal chain of command around here, make it easier to trade (this _might_ be about labour/immigration), etc. So thinking I may go long on a few tech stocks soon..

I never forget Trump's own words: "I can be different things to different people."

What do you guys think of the "January effect" (https://en.wikipedia.org/wiki/January_effect)

Is it a wise idea to buy stocks now?

maxysu wrote:What do you guys think of the "January effect" (https://en.wikipedia.org/wiki/January_effect)

Is it a wise idea to buy stocks now?

Presumably if it's real it's already factored in.

How likely is it that American investments overseas will be nationalized by Russia, China, or others in the event our relation with them sours?

Bannon is anti china, pro war. And the Russia bromance strikes me as unstable. Furthermore, mainstream EU is placing Trump on their "threat list."

https://www.washingtonpost.com/news/wor ... 93b401c21a

Probably not highly likely. For one, it's basically impossible to nationalize companies like Apple and those are the common types of companies in China. They would just make the phone, etc. somewhere else. The only industries in any real danger of nationalization are rent seeking industries (oil, coal, iron ore, etc.). Maybe a few oil interests in Russia are threatened, but much of those died years ago because of the sanctions on Russia.

What about the opposite problem, government "nationalizing" (bailing out) failing companies.. What can we trust, predict Trump to do if he is in a similar position that Bush was in in 2008?

Neil Howe/Hedgeye take on the first two weeks of Trump and the economic climate going forward ... https://youtu.be/HbWSpCS_obM

Neil didn't seem confident Trump was the Gray Champion. A shame. I'm not confident Trump will be a net positive, but would happily be wrong and for him to be the champion. Is he the guy that helps create the scenario that creates the champion? Hard to say.

Neil mentioned something about it depending on if the younger generation gets behind him? That's a big ask and more likely would have been Bernie.

https://www.bloomberg.com/news/articles ... enthusiasm

Goes along with what I've said previously wrt to the post-honeymoon reaction to the election (the ultimate consequence of nulling trade agreements and seeking protectionism). The nerds would see the spread of the graph as the acceleration of market inefficiency (the difference or spread between popular sentiment and reason).

Personally, this [sentiment] has been high enough for me to write some covered calls in the past few weeks. First time since 2007. So far so good.

Chad wrote:Neil didn't seem confident Trump was the Gray Champion. A shame. I'm not confident Trump will be a net positive, but would happily be wrong and for him to be the champion. Is he the guy that helps create the scenario that creates the champion? Hard to say.

I think he is cognizant of what he wrote in his book -- this person must be well-liked by the young to qualify and so far Trump just doesn't.

"The final Boomer leaders— authoritarian, severe, unyielding— will command broad support from younger people who will see in them a wisdom beyond the reckoning of youth."

Strauss, William; Howe, Neil. The Fourth Turning (p. 287).

He may be more concerned with the monster scenario:

"It is easy to envision old Aquarians as pillars of fire leading to the Promised Land— but just as easy to see them as Charonlike monsters abducting doomed souls across the Styx to Hades. Either is possible."

Strauss, William; Howe, Neil. The Fourth Turning (p. 288).

I thought his insight into the best market outcome for the administration would be an abrupt decline in financial markets now, or a surge, with the worst outcome for the next election being not much movement, was interesting.

Hedgeye is doing an "Inside Bannon's Brain with Neil Howe" presentation for their paid subscribers, which I imagine they will post to YouTube for free at some point in the near future.

Trump all of the sudden becomes a lot less interesting than the levers being pulled in the background.

Is Hedgeye a right-wing thing? (Hah, why am I asking, it's finance.) Seemed like Howe was choosing his words carefully for the audience (could just be his speaking style, I haven't seen him talk enough). But I think he made his real sentiments obvious by reiterating that many expect Trump to be impeached within two years. Not to mention the point regarding support from the youth.

I'd lean more toward @Chad's supposition that Trump is more likely to become the catalyst (or one of the catalysts) of the crisis that leads to the appearance of the Gray Champion. Based on my own knowledge of Gen Y and my reading of the Fourth Turning, my impression has always been that the "return to civic-mindedness" that my generation supposedly represents will be embodied more by leftist socialism than right-wing fascism. Perhaps there's some of my own bias (or optimism) in that analysis, but I'd say how we voted holds this up. I don't see my generation broadly getting on board with the alt-right neo-fascism. Trump was chosen by boomers, not us. Hopefully he'll be their final victory. Best case scenario, the impending rise of fascism will cause a climax that results in a boomerang to the left and the fully automated luxury space communism we deserve. Either way, Orange Chump is no Gray Champion.

The owner/main proponent of it, Keith McCullough, seems more of the libertarian persuasion (he's Canadian by birth), but has seemed more pro-Trump since the election. He does have that "raw, unfiltered, tell-it-to-you-straight schtick" about him that so many of my cohort (guys around 50) have fallen into and I'm afraid is now just looking like "older Gen-Xers trying to recapture the edginess of their youth." It's like a verbal comb-over. Others that fall in this category are Michael Covel (podcast) and Mish Shedlock (blog), but I think it originally descends from Glenn Beck as a motif, and its getting pretty worn.

But I don't watch it for him - he has assembled a useful group of commentator/experts in various areas that often provide useful and interesting information, including Howe (who is fiscally conservative and mostly socially liberal) and some General who is a contemporary of the new Sec. of Defense. He also occasionally snares people like Gary Schilling who have been around forever and have interesting things to say.

I don't see Trump have a huge attraction for the younger people either, unless he were to actually implement a real FDR-style jobs program for depressed areas. I can't see that happening at this point, though.

https://www.nytimes.com/2017/02/06/busi ... stors.html

A rare public comment from one of the gods of value investing.

Klarman is probably correct on all counts. The real question is how soon.

The point about higher volatility of the market with ETFs is probably valid and it will get worse. Bill Miller on the MiB podcast noted the same thing Klarman did and believes ETFs will go from owning a current 30% of the market to 70% of the market.
http://ritholtz.com/2016/11/mib-bill-mi ... egg-mason/

Also, you would think finance reporters would be better than this:

What investors say publicly and what they do in the markets can be different things. Mr. Buffett campaigned publicly against Mr. Trump, but he has nevertheless invested in the market since his election — about $12 billion, according to a recent disclosure.

Klarman and Buffett's investment timeframes are going to be vastly different. This will almost always be true of anyone compared to Buffett.

“With any asset class, when substantial new money flows in, the returns go down,” Mr. Klarman wrote. “No surprise, then, that as money poured into hedge funds, overall returns have soured.”

How do you find out where the money is flowing?

To Mr. Klarman, “stocks outside the indices may be cast adrift, no longer attached to the valuation grid but increasingly off of it.”

Is he talking about private equity? Forgive my ignorance, but isn't every publicly traded stock in a Total Stock Market fund? Aren't they all in some ETF or another as well?

Money flow into hedge funds? Hedge funds are required to file reports with the SEC.

Is he talking about private equity? Forgive my ignorance, but isn't every publicly traded stock in a Total Stock Market fund? Aren't they all in some ETF or another as well?

A lot of the stocks are in different ETFs/Indexes, but the percentage of the total outstanding shares owned by ETFs/Indexes varies. For instance, DOW stocks probably have the highest ownership among ETFs/Indexes given how popular the index is and the size and importance of those companies.

Dragline wrote: Hedgeye is doing an "Inside Bannon's Brain with Neil Howe" presentation for their paid subscribers, which I imagine they will post to YouTube for free at some point in the near future.

https://app.hedgeye.com/insights/57111- ... uthor-neil