Josh Brown penned a missive today that brings up a great debate point along with a historical event:
In the Name of Corporate Profitability, 1781 and Today
You really need to read about the Zong Massacre. Here is the debate point:
There is a question now about whether or not productivity gains and the ability to "remain lean" will allow Corporate America to maintain these historic levels of profitability. I would answer that perhaps companies can keep this game going awhile longer, but at what cost to the country around them?This is key. If companies were to hire more here the costs would eat away at margins huge and hence stock prices. The time lag for when people would gain by higher paying jobs may be a poor time for stocks. And as we know, stock prices matter more than anything else. Going to think on this one a bit.
Erik Swarts of Market Anthropology has a wonderful big picture post up that I really think is worth your time:
A Few Thoughts
He drops Wikipedia use in the article which will always grab my attention.
iBankCoin's ChessNwine has an important article up tonight and it's a must read for any market participant:
The Two Most Important and Least Discussed Aspect of Trading
Readers know that I am not a trader that relies on market returns for income. I don't know that I ever could do that. But whether you are trading for a living or trading to build wealth for the long term you have to be very aware of one thing: your bankroll. How you make decisions will be HEAVILY influenced if you "need" a certain thing to happen on a trade. The best way to need any result is to have too much money that you cannot lose at work. From Chess:
There are plenty of talented traders out there who blow up their accounts not because they got outmaneuvered by the guy (or robot) on the other side of their trade, but because they were simply not bankrolled properly and felt compelled to overtrade in poor market conditions to try to “pay the bills.” Well, I have news for you: If you need to trade to pay your electric bill and utilities, then you are in the wrong profession. Being properly bankrolled also gives you the peace of mind that you do not have to, in fact, trade all day, every day.There is more in the article so take a look.
I don't know what is going on in Iran. A missile compound over there was clearly destroyed and news about that is very thin. Tensions have been rising in the area and we all know those losers are insane. Zero Hedge takes a look at Pimco's Oil price thinking should something happen:
Pimco's 4 "Iran Invasion" Oil Price Scenarios: From $140 To "Doomsday"
Not market related but the Mars Science Laboratory rover Curiosity is set to land at Gale Crater on Mars this summer! The new rover is a monster! Check out the section on how they plan to land it on the surface of Mars, very complicated:
Mars Science Laboratory
Cannot wait.
Have a good night.
The reason why stock prices matter more than anything else is because executive compensation is tied to stock options.
ReplyDeleteAs for playing the market, I think of it a lot like dating. Do you know her? Is she honest? Can you trust her? These are the questions you ask.
There was a recent story about some guy who was dating a stripper. They broke up after six months. Unbeknownst to him, she had been saving his used condoms and storing them at a fertility clinic. So, when he dumped her, she underwent invitro fertilization, then slapped him with child support for twins. (That's like 20% or more of every paycheck for 18 years.)
He protested, of course, even sued. But he doesn't have a case. He knew what he was doing. He did not know what she was doing. That's his problem.
There was another case a few years back involving some stupid doctor who was having an affair with a nurse at his clinic. She performed oral sex on him, then spit in a plastic bag, used a turkey baster to impregnate herself, and slapped him with child support. He protested, sued, and took his case all the way to the state supreme court.
The court ruled: "Upon ejaculation, plaintiff tendered to defendant free and clear title to property." Think about that for a long while, boys. That means she owns it, and once you give it to her, she can do whatever she wants with it. And sperm is money.
Luck is a lady, and she's fickle, the old saying goes. Same with the stock market. You want to invest in a company? Do you know it? Is it honest? Can you trust it? And are you willing to bet 20% for 18 years to find out it's not?
Yeah, I'm a cynic and a misanthrope. But then Ms. Hillier knows a lot more about sex addiction than I do.
Kidding! I'm just kidding, Jennifer. But I couldn't resist.
Sex addiction, serial murder, dismembered bodies in basements--sounds like the stock exchange to me.
I can only comment on the Mars rover item, as I've been following that bit of news for a while and am beyond excited that the launch was successful. It goes without saying that I'm eagerly awaiting Curiosity's arrival on the Red Planet next summer. I'm actually very nervous, as I want so badly for this mission to be a success. *fingers crossed*
ReplyDeleteThe Mars Rover news is cool. Good to know we haven't abandoned all apace exploration.
ReplyDeleteAnd finally found a way to follow your blog! Sorry it took me so long.