I did not watch television today, but can guarantee you that CNBC was cheerleading Dow 10,000. I know they were cheerleading 10,000 in 1998 as well…I was watching back then.
I feel that we are at a major inflection point. Stock prices point one way and every instinct I have says liquidate everything and buy gold (long), water (long $pho), guns and fur.
I truly don’t know which is correct. Nobody does. You should invest with people that can manage risk, not those focusing on predictions.
The markets are ripping. It’s pretty fun watching and participating unless you are really short. It’s obvious that many are short and underinvested, especially at the retail level. It is fear and frustration gone mad at both ends of the spectrum today as the Dow closed above 10,000.
I can’t imagine running big stock market money.
In the hedge fund world my mantra ‘Too Small to Fail’ does not work.
If you are too small, you fail. You need to manage more and more money and the beauty of that is the scalability of the money management business. That is the sex appeal that will never go away.
I don’t make price predictions on this blog, but I do make trend bets.
I have been long Gold, Silver, Mobile, Amazon, Oil and Real Time Web for a long time now. It’s all in the archives. I don’t see any of those trends ending but would never catch the top anyway. There are so many macro and financial policies in place that you have to be on another planet to miss them.
In real estate, things are not as bad as Vegas, but not as good as the stock market is pricing.
In banking, I just think the prices are all rigged and broken so I am avoiding.
What has me extremely bearish is the friction and frustration in the systems. There is way too much business and government friction in America and that trend will only be getting worse. That friction is insanely frustrating. There will be continuing frustration from the unemployed and underemployed masses. We are just not properly trained as a nation. The bulk of us are working waaaaaay harder for less wages. Don’t hope or expect a change here.
To manage the friction and frustration trend, I am underweight stocks, but long early stage frictionless, flexible teams in the web space (my ‘Too Small to Fail’ thesis).
Because of the fear in the stock markets…all from the illiquid and underinvested, I will remain long, but small.
It seems obvious that prices are going higher, but I am respecting the four F’s and investing accordingly.