My name is Jan and I am a guaranteed loser

by admin on March 27, 2013

I can calculate the motion of heavenly bodies, but not the madness of people.

Newton

My name is Jan Pstrokonski and I am a guaranteed loser.

Although my best grades at school were in statistics, I can only vaguely remember some guy, probably a French guy, saying that two unlikely things occurring in series are much much more unlikely than just one unlikely thing. This means that the prospects of improving on this quarter’s performance are dim.

However, it is worse than that. By allocating assets to gold, I am effectively guaranteeing loser-dom.

You see, if the yen falls, stocks go up, and I am underleveraged. The gold helps a bit, but it is still a losing scenario.

If the yen goes up, gold may well fall relative to the yen, and my pants remain lowered in that I still own stocks.

 

So, how did a bit of Nikkei action turn me into a spineless chicken?

It seems to me that, over the past few weeks, stocks have been going up as the yen has been falling. We only have the data up to about two weeks ago, so there is some speculation in divining what is going on.

This development can be read in several ways, but to me it says that foreigners are getting out (they’re not that welcome in Japan anyway, unless it’s to consume touristic products) while domestic money is coming in – probably retail-type money. What is retail good at? Yes, being late and wrong.

 

I have been told that my late aunt had schizophrenia. She lived on a boat owned by the Canadian government, which has to be almost as isolating as living somewhere where you stick out like a sore thumb, such as Japan. Whether related or not, a bit of multi-personality thinking can be helpful.

Stock market divination Stock market divination

This is one view of the minds of people at present:

 

Fat Tony: “You know what, boss, they have this year-end thing going on at the end of this month, the S&P is looking toppy, the yen has moved too fast, and we’re sitting on good gains. Shall I put the pull the trigger?”

Japanese fund manager: “Thank God for these foreigners! Let’s get out of some more positions before they notice the reality at the BOJ and the slow response in the real economy.

Local retail guy: “I read in a newspaper that stocks are going up, maybe this is my opportunity ….”

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