Think about it. Every single one of the Prophet of Doom turned out to be false or very ill-intentioned, crazy religious loons of some sort who just coveted young pretty underage girls. Really.
So why am I predicting riots, posting an e-mail about commerce seizing up, and credit goes away, civilization at risk? This is NOT professional. You trade, and only trade.
Yes, but you would leave something out.
Trade the tape you get.
What is the current tape?
(Let me get to that after I go out tonight- what little scientific knowledge that I have at this point is NO USE, just to give you a hint. Later.)
There's just no credit out there, man. Thanks to 10 years of supercharged fraudulent lending/insurance. Tapped out. There are two types of insurance out there: One is where you can insure yourself, and two is where you have a chain of people who either passed the bucket along a straight line down to the dumbest/poorest insurer who insure EVERYONE, or one that goes circular where A insures B, B insures C, and C insures A.
A total shitshow.
What was then the fuzz about covering the shorts, like why did I cover Wamu shorts about 20% each time that went south $5 back in the days? I was sure of my numbers, I can read prices correctly, and based off that Wamu is 3x underwater by equity - so why did I cover?
Again, the fear is that all of us with brain saw that this is a crazy inverted pyramid that has been around for all we know, ages. It defies physics and sometimes it shook, but it always, ALWAYS killed anyone who doubted the inverted pyramid's ability to make money. What use was it then, being right, when in the end you will almost certainly get killed fighting the pyramid?
Then it started to change. The inverted pyramid started swinging with larger and larger amplitudes with every failures the whole scam apparently was unmasked. The difference THIS TIME is that somehow the world REJECTED to stand by and continue the scam.
Other than that's the right thing to do in the first place, I don't yet have any explanation. Maybe it was the critical mass. Maybe there's just too many rats leaking balance sheet to investors from inside the company masking as bloggers. Maybe it was never a secret. Maybe everyone is fed up and wanted a non-finance based economy.
This sort of changes are sweeping. Big hurt came to countries that experienced these changes in the past decades/centuries and mass violence was almost guaranteed. The risk of a total meltdown was always 0% in the last 100 years, and then last week it was 1%, and now I personally feel it's about even odds.
Again, I wish we can just accept the frauds as a fact of life and increase the size of the pyramids instead of toppling it. I really am not being cynical here. There was nothing wrong with inverted pyramid for a looooooong time other than being unsightly and immoral. It will be a monumental task to understand why this time it's different, and that was the basis of calling a social unrest and indices going to zero, which happens when "this time it's different".
I have no problem with being wrong, no problem at all. But I will just trade the tape I get.
The right enemy
5 years ago