All the negative news

[Guest ValueCarl]

During periods of hardship or despair there will be, and has always been exceptions to the rules, those special stand outs who defy logic and capitalize on the woes of mass audiences. Look at two Buffett companies who did such a thing during Katrina, for example.

 

http://www.lexisnexis.com/Community/LitigationResourceCenter/blogs/litigationblog/archive/2010/03/31/defendants-prevail-in-2nd-formaldehyde-trailer-litigation-bellwether-trial.aspx

 

Some here like to point towards shining stars of GD1, like Templeton, or Baruch, that consummate INSIDER and political hack of the period. Kennedy might be another as is Rothschild, although when you point to a "central banker" you are pointing to a dictator of "money supply" who will have their way on pricing directions because of their "control."

 

There are many reasons why certain people succeed wildly versus others which go beyond "the fix" which is absolutely what the "stock market" is mostly about.

 

Take golf as another example. How many Woods' have there been, or will there be time perpetuity?

 

You see, eighty percent of US households are one pay check away from bankruptcy, and that's no lie. Historically, they have managed to stay afloat by this borrow and spend INFLATION MACHINE all while the capitalists ROLLED UP and AWAY important production facilities abroad so that ultimately, their unsubstantiated, valueless paper currency will be scorned by trading partners, and mourned by its more serious stewards who have a basic understanding of about what I imply.

 

Additionally, the atrocities which continue to be committed by their political bodies, a group of > 500 people in all (3) government branches influenced and controlled by the same dubious bankers who took the taxpayers' loot and ran, is so blatant and outrageous, that even the simplest of men know they've been duped. Those type of mental scars do not go away quickly, as has been cited here. They fester and linger and work in a virtuous cycle, one I described as a "negative feedback loop."

 

Historically, those WOUNDS are only contained via the outbreak of banker incited wars! I suspect this won't be different this time, whilst referring to another Great War of global proportions. 

 

 

Some men here like to talk about twenty and thirty year periods of famine, where psychology acts as an albatross for more stingy valuing metric sticks. When you examine this time period deep inside the caverns of your minds, as though it's an easy mark to endure consistent, persistent, sustainable success stories for any part of your lives, reflect backwards during the past twenty and thirty year periods of your life for answers to how unpredictable it is, and will remain going forward.

 

At the same time, always remain mindful of "time perception" and the speed which such lives wither away on this earth as a result of time/experience base.

 

When I was five years old, one year seemed like such a long period of time! It no longer does at fifty! Life is short, so don't forget to smell the ROSES along the way!

 

Anyway, which one of you MONEY MONGROLS will it be who stays alive long enough to be rewarded sufficiently according to Rule 72, which must have massive INFLATION for its ultimate benefits? Who is greatest amongst you to be that top ten thousandth of one percent percentile winner? Parsad, is it you?

 

I recommend you eat more FIBER, and stay extremely lean and healthy! ;D

 

[locutusoftexas]

I would like to echo the posts on the oil and inflation crisis during the mid-1970s, which included the winding down of the Vietnam War. My perspective is that the mid-1970s were the greatest financial and political crisis post WWII and not the current one. Everything went to hell in a very big way. I remember my favorite all-time contrarian signal in fall of 1980, when the Wall Street Journal cited several notable economists who stated that our economic system was on the verge of failure and would not survive into the future. In fairness, stocks were at an average PE of around 7, but of course inflation was massive, as were interest rates ultimately. So the relevance of the comparatively low PE (that is relative to present times) is a bit murky.

 

I have an opinion and a suggestion. The fear now is massively out of proportion to the level of the so-called "present financial crisis." This dominance of fear, anxiety, and perceived pain has been a consistent aspect of the US personality since 9/11. In the mid-1970s, people were worried and irritated, but less fearful and much more determined to work at surviving the crisis. Buffett was ecstatic; I remember a quote something like "He felt like an oversexed millionaire in a house of prostitution." He has also been buying recently. Regardless of the existence of blood in the streets, people now are scared to death and extremely risk averse. This is way overdone. Seems like another contrarian buy signal to me.

 

The suggestion: People wonder where the "boost" to our psychology and economy will come from. I believe that unwinding the wars in Iraq and Afghanistan will boost both, just as the  unwinding of Vietnam did post 1974.  A country just can't throw away 1-2 trillion dollars on useless and longlasting wars and expect not to pay a  severe price economically. Once we stop throwing money down those black holes, the US economy will improve and the global level of pessimism will subside.

 

I say "Enough already!"

 

Best regards,

Tex

[watsa_is_a_randian_hero]

I have an opinion and a suggestion. The fear now is massively out of proportion to the level of the so-called "present financial crisis." This dominance of fear, anxiety, and perceived pain has been a consistent aspect of the US personality since 9/11.

 

Definitely agree.  The "boom" that occurred only benefited a minority.  Most people even in midyear elections of 2006 were talking about the economy as if the recovery was still jobless and weak.  In my opinion psychology of the average joe as been that nothing good has came from economy from last 8 years.

[frog03]

Sanjeev,

 

I don't see why you call Sprott a nut.  You advocate long term returns and you beat him on the head for 2008, one year out of 30?  Out of 30 years, he has made 20% net for his investors compounded after copious fees for:

1) his managed accounts (read stock market superstars)

2) his Canadian equity fund (19% IRR since 1997 as of last month, close to 13 points ahead of the TSX)

3) his hedge fund is also up 20% annually since 2000

 

Some of his funds have been launched a few years ago and/or are not managed directly by him.

 

Watsa has had several years of terrible performance and very large leverage.  He came out of it but quite possibly could not have (look at his debt to equity ratio just a few years back at FFH...).

 

A lot of your comments I agree with but your cheap unjustified shots at Sprott don't make any sense.

 

 

 

********************

 

What are 3 of the top performers in the stock market in North America over the last 30+ years?  Buffett, Watsa, Sprott.

 

Buffett : His exposure to stocks as a percentage of assets is not super high

Watsa : Fully hedged

Sprott : 3/4 in precious metals and precious metal stocks, some shorting of financials/retailers/etc

 

Buffett just completed the largest equity purchase in Berkshire history - Burlington Northern Santa Fe!  Yes, he took it private, but he still paid market prices.

 

Prem just finished buying all of his public subsidiaries at market prices.  Again, they are private now and their valuation is not open to the whims of Mr. Market, but he still paid market prices and the long-term outcome of his investment is completely predicated on the price he paid.

 

Sprott - Well, he's just nuts!  Incidentally, outside of his hedge fund which was hedged, didn't all of his other funds get absolutely killed when commodity markets corrected back in 2008?  I think they were all down a minimum of 35%, and all the way up to 65% in 2008.  Cheers!

 

 

[Munger]

I grew up in midwest (live in chicago now, cleveland originally).  There remained a sentiment that throughout it all, the recovery was jobless and only benefited rich.

 

The housing bubble was a mass hysteria -- more in some parts of the country than others but the country was broadly infected by the delusion that buying a house was the road to riches for the middle class.

 

-Credit card debt is at 8 year low.  Credit card debt is same as it was 8 years ago

 

The article goes on to state -- " the foreclosure crisis could be helping to improve the timeliness of credit card payments and lower balances. When people don't make mortgage payments, he suggested, they have a short-term cash boost."  Not exactly a sign of financial health.

 

And here are some facts:

In 1929, household debt as a % of GDP reached app 100%.

During the period btw the Great Depression and WWII, declined to approximately 20% of GDP.

Further, household debt did not again pass 50% of GDP until 1985!

 

Now let's see where we are today:

Household debt as a % of GDP reached 100% again in 1Q09.

At the end of 1Q10, household debt as a % of GDP totaled app 93%.

The US consumer has not de-levered in any material way -- we have a long way to go!

 

I think you're wrong here.

 

No -- value investing is based on absolute value.  There is no debate.  Playing on the greater fool is a different story.

 

You study up on it.  How many have there been?  Great sample size.

 

Do you really believe the accuracy of the analysis is a function of sample size??  The accuracy of the analysis is based on the math and the numbers as they exist today.

 

 

What do you think will happen if "Ben" buys back every treasury, and there are none left?

 

Each and every bank in the US would immediately stop lending (issuing new loans) the minute Ben announced his intentions and the economy would collapse shortly thereafter.  Further, every foreign institution would immediately dump existing holding of ALL US debt -- chaos would ensue and the US as you know it today would no longer exist.  Stocks would collapse.  

 

What do you think would happen if tax rates went to 0% and government just printed money.

See above.

 

 

At some point, fiscal/monetary stimulus has an effect at margin.

 

Do you really believe easy money is the solution to our problems?  Inflating another asset bubble?  Adding more debt to an already over-levered system?

 

 

Also, private sector is adding jobs strong

 

Those hiring numbers are terrible.

 

 

 

 

 

 

 

 

 

 

 

 

 

 

[Guest ValueCarl]

The first thing I thought while reading the underlying stupidity of this statement was, if one is "defaulting" on "SECURED" debt in the form of "mortgage payments," then why would they accelerate principal balances on "unsecured debt" in the form of "credit cards," when knowing that as soon as they do, the bastard bankers are SHRINKING their spending lines to the lower amounts, thus CAPPING their spending capacity, remnants of easy lending days gone by?

 

Not only is this UNHEALTHY that a mandatory housing payment is being missed to pay credit card debt, it's UTTER LUNACY. IMO

 

<The article goes on to state -- " the foreclosure crisis could be helping to improve the timeliness of credit card payments and lower balances. When people don't make mortgage payments, he suggested, they have a short-term cash boost."  Not exactly a sign of financial health.>

 

[Parsad]

It's one thing to take issue with his macro views, but to label him "nuts" is more suitable  for a sound bite on Fox News, than an informed discussion.

 

Hi Broxburn,

 

The Sprott comment was tongue in cheek.  I thought I put a smiley face on the end of that exclamation point but I guess I didn't.  He's a gold and commodity bug, which is the complete opposite of what I would do, thus the "nuts" comment.  Cheers!

[turar]

Munger, just wanted to say that I appreciate your posts. Very interesting.

[watsa_is_a_randian_hero]

What do you think will happen if "Ben" buys back every treasury, and there are none left?

 

Each and every bank in the US would immediately stop lending (issuing new loans) the minute Ben announced his intentions and the economy would collapse shortly thereafter.  Further, every foreign institution would immediately dump existing holding of ALL US debt -- chaos would ensue and the US as you know it today would no longer exist.  Stocks would collapse.  

 

What do you think would happen if tax rates went to 0% and government just printed money.

See above.

 

 

At some point, fiscal/monetary stimulus has an effect at margin.

 

Do you really believe easy money is the solution to our problems?  Inflating another asset bubble?  Adding more debt to an already over-levered system?

 

I'm not speaking about my opinion of what is the "solution" to "our" problem.  I don't have a problem.  Through the recession my net worth has increased from less than 1x annual spending to over 4x annual spending.

 

From my point of view, there is no solution that does not cause pain.  I am a libertarian, I would prefer the government do nothing.

 

That being said, I don't let my preferences affect my expectations about what will actually happen.  I believe what will actually happen is the (1) US Government will continue buying back debt and fiscal stimulus.  The act of buying back debt reduces our economy's leverage (solving the "balance sheet recession problem") but increases cash in circulation. (2) this increase in cash in circulation from government buying treasuries back from insurers, pensions and banks will force them to invest in other marketable securities, pushing up asset prices, creating asset-based inflation (3) this inflation will reduce the debt/assets and debt/GDP ratios of the country.

 

 

Anyone in debt will benefit from the inflation, helping average consumer.  Any lender will hurt, hurting the wealthy.  QE is wealth redistribution.

[Parsad]

Headlines were bad but reality was not ugly -- peak to trough GDP decline of 1-2% is nothing compared to historical periods of stress.

 

C'mon Munger, Bill Gross was writing about the death of equities, 3000 hedge funds went under (one-third of all that existed), the credit markets were completely...and I mean completely...seized!  The debacle with the credit markets was as bad as anything experienced in the early days of the 1929 market crash.  It took one hell of a coordinated effort around the world to start to loosen things up, otherwise we most definitely would have been looking at another Depression.  Buffett called it "an economic pearl harbour!"  Prem expected a one in 50 or 100 year storm...we got the 50 one!  

 

I remember the sentiment around value investors...you couldn't get them to buy stuff...WFC at $9, GE at $6, Costco at $39...nope!  Friggin' Starbucks was selling at $8!  Literally everything had stopped!  Go back and look at the drop in rail traffic and cargo volume between 2007, 2008 and then 2009...it was a cliff-like drop in the 4th Q 2008.  The diehard investors were scared sh*tless!  

 

If you click the last few pages on the "General Discussion" page on this site, it will take you back to about February 2009 when this board was launched.  You can read some of the posts, articles and stories on there.  There were only a handful of boardmembers who were buying right at the bottom.  And sentiment was even worse back around August through October of 2008 when the credit markets seized.   Anybody who thinks that period wasn't damn ugly is fooling themselves.  Cheers!

[valuecfa]

I think there is hardly blood in the streets. And this comes from someone who was recently laid off. They were painted red back in March 09, but not now after a massive rally since that time.  The tail risk of credit seizure, money markets, derivatives, etc. have largely gone away thanks to intervention. The risk to the market now is a valuation adjustment. Stocks are trading at a premium to historical levels, on a 10 year average basis. I don't think that premium is justified given the levels of uncertainty in the markets regarding low growth, and deflationary pressure over the near term. I think valuations are likely to revert to a lower multiple to adjust for the period we are in. This may not happen soon as markets are, of course, not efficient. If you think that the market deserves a 15 multiple than the market is slightly over valued. If you think it deserves closer to a 10 or 12 multiple given the environment, then it is richly valued. If you think growth we be relatively higher than everyone is forecasting, then it is fairly valued. I find it hard to argue that they are however cheap. We see headlines now that say, same store sales are up 30%, earning up 45%, etc... but people forget that they are comparing results to one of the worst economic years in history. Of course earnings are higher!

 

It took a great deal of fear (myself included) for the markets to correct to the depths of the March lows. If you weren't terrified you didn't know what was going on. I don't see that happening again. I feel confident that we will not see those lows again. I think the next fear (or catalyst for a correction) will be valuations, which i perceive to be on the slightly rich side. There are other external shock possibilities in European bank debt, and China which is an overheating monster, but i think if there is tail risk to the system that those respective governments will intervene if necessary, which of course will remove a large drop in the markets, yet also has the effect of prolonging the recession.

 

Personally, i would likely cover all hedges on approx. a 15% drop from current levels. As the markets creep lower i would slowly remove hedges, and not necessarily time the exact bottom. There are still some reasonable valuations out there in individual companies, but as a whole i think the market is still a bit rich, and not properly reflective of the economic environment.

[Parsad]

Sanjeev,

 

I don't see why you call Sprott a nut.  You advocate long term returns and you beat him on the head for 2008, one year out of 30?  Out of 30 years, he has made 20% net for his investors compounded after copious fees for:

1) his managed accounts (read stock market superstars)

2) his Canadian equity fund (19% IRR since 1997 as of last month, close to 13 points ahead of the TSX)

3) his hedge fund is also up 20% annually since 2000

 

Some of his funds have been launched a few years ago and/or are not managed directly by him.

 

Watsa has had several years of terrible performance and very large leverage.  He came out of it but quite possibly could not have (look at his debt to equity ratio just a few years back at FFH...).

 

A lot of your comments I agree with but your cheap unjustified shots at Sprott don't make any sense.

 

 

Hi Frog,

 

As I mentioned to Broxburn in another post, the "nuts" comment was tongue in cheek.  Sprott has a heavy vested interest in gold and commodities, and I have no interest in them whatsoever...the "nuts" comment was a tongue in cheek shot at that.  Cheers!

[Munger]

(2) this increase in cash in circulation from government buying treasuries back from insurers, pensions and banks will force them to invest in other marketable securities, pushing up asset prices, creating asset-based inflation

 

This is crazy talk.  First -- QE doesn't force insurers, pensions, and banks to do anything...they can and will sit on the cash or buy more treasuries as they are doing now and have done in Japan for 20 years.  

 

Further -- ASSET BUBBLES ARE NOT SUSTAINABLE by definition.  Asset based inflation MAY delay the day of reckoning but will make the ultimate pain far more horrific as the debt will still exist (and must be paid off) after asset values collapse.  

 

 

(3) this inflation will reduce the debt/assets and debt/GDP ratios of the country.  Any lender will hurt, hurting the wealthy.

 

Repeat -- asset inflation driven by cheap money (i.e. a bubble) is not sustainable -- solves no problems.  

 

 

 

Sorry -- more easy money, inflating asset bubbles, adding more debt to an already over-levered system solves no problems.  

 

 

Wish you the best with your approach.

[Munger]

Parsard -- there was headline fear but reality is GDP barely declined.  I think the perception of blood in the streets was driven by the fact that America hasn't experienced any real economic blood in the streets in a very long time.  In my opinion, the lack of perspective and whining was stunning relative to the actual pain.  Everyone thought (and continues to believe) that after a small pause, the good times should just continue to roll!!! 

 

GDP declined 32% during the Great Depression -- now this is pain my friend...true blood in the streets. I firmly believe this scenario is very possible at some point over the next 5-10 years.

 

 

 

 

[watsa_is_a_randian_hero]

This is crazy talk.  First -- QE doesn't force insurers, pensions, and banks to do anything...they can and will sit on the cash or buy more treasuries as they are doing now and have done in Japan for 20 years.  

 

 

1.  Insurers, Pensions, and banks all have liabilities that they need a return on assets in order to pay.  They also all have duration matching issues and investment policy statements.  They cant be 100% cash.

 

2.  As a hypothetical, pretend treasuries dont exist.  The fed has bought them ALL.  Then what do they do?  They will go out the curve in duration, and make more risky investments.  This will compress spreads, increase price of real estate, increase prices of stocks, and increase prices of commodities.  This will spur investment demand which will spur consumption demand and inevitably consumption inflation.

 

 

Again, at some point, QE will inflate asset prices and cause inflation, meaning there is no balance sheet recession.  Deflation is only a problem in situations such as these where the stimulus was too weak.

 

Those thinking deflation is inevitable and the government is pushing on a limp string are burying their heads in the sand.  How about a $1 million dollar tax credit to every citizen.  Think we'll have deflation then?  Deflation is 100% preventable, so long as proper stimulus is applied.

[turar]

Parsard -- there was headline fear but reality is GDP barely declined. 

I think you guys are talking apples/oranges, i.e. GDP vs stock market prices.

[opihiman2]

Munger makes very good points here.  In terms of economic crisis, I believe comparing March of 09 to the Great Depression is like comparing apples to oranges.  I mean, really, has anyone heard of people working for food in the past year?  I can't say what the Great Depression was like, obviously, but judging by the stories from the people that lived through it, it seemed to be much more painful than what happened in the past year.  Although, who knows, without the massive intervention, we might have seen people working for food in 2010.  

 

Also, QE is definitely not wealth redistribution.  I need a citation from a credible source, Watsa.  

 

 

[oec2000]

Hawks,

 

Good post and fair points although I disagree with some of the conclusions you draw.

 

Yes, there are some posters (only a handful imo) here who are very macro driven who have gone to very high cash positions. There are also some who adopt the fully invested buy & hold strategy. However, the majority of the posters fall in between these extremes. I would put myself in the last category.

 

You mentioned Watsa, Buffett and Templeton.

 

Watsa overlays macro calls over his stock postions. And he is >90% hedged now and has just bought deflation protection.

 

Buffett tempers his stock buying with a keen eye on market and economic conditions. There are times when macroeconomics influence his decisions. He has shorted the USD, and he goes through periods where he builds up cash. BRK is a monster cash generating machine so when he is not increasing BRK's equity holdings, he is effectively raising cash. He has not been talking excitedly about candy stores or harems lately.

 

Templeton would not have been able to buy at times of max pessimism if he did not have wads of cash lying around when that happened. (This is why many fully invested value investors stumbled in 2008/9 - they could not take advantage of the blood in the streets.) So, there must have been times when he was not fully invested.

 

Seth Klarman is another master you did not mention who remains guarded.

 

The question is whether we are at a point of max pessimism right now. I don't think so. Yes, the recent economic data have turned more negative recently but most commentators are still blissfully sanguine about the outlook and worried about the wrong risk (inflation and the bond bubble). Very few predict a double dip or deflation which would cause much more severe problems because of the high levels of debt everywhere. Eurozone fears have ebbed even though their stuctural deficits remain and their banks haven't deleveraged to the same extent as in the US; and, the indebted US consumer is not ready to resume his spending binge soon enough to ward off the danger of deflation.

 

Meanwhile, equity sentiment measures are on middle ground - fear is not in the air.

 

So, while I agree with you that some stocks look inexpensive, I don't think they are even close to "blood in the streets" cheap. Given that there is not an insignificant risk of deflation, I would leave myself some room for manouevre. We have much less experience with deflation than inflation so we do not really understand how things could play out in that scenario - especially with the high leverage around us. Under the circumstances, I am happy to keep 50% in equities (provides upside if crisis is indeed over), 25% in relatively high yielding pfds 7-8% (which will deliver very juicy real yields in case of deflation, yet provide a decent steady return if economies do not falter but recover) and 25% in cash for fat pitches if they arise.

 

I would like to be 100% in equities but only at prices that adequately compensate for the risks. I don't know how the risks will play out but right now I am happy to trade-off some potential return for a more resilient portfolio.

 

 

[Parsad]

Munger makes very good points here.  In terms of economic crisis, I believe comparing March of 09 to the Great Depression is like comparing apples to oranges.  I mean, really, has anyone heard of people working for food in the past year?  I can't say what the Great Depression was like, obviously, but judging by the stories from the people that lived through it, it seemed to be much more painful than what happened in the past year.  Although, who knows, without the massive intervention, we might have seen people working for food in 2010.  

 

We were well on our way if it wasn't for the coordinated intervention, quantitative easing, Fed windows, and the various programs put in place (TARP, housing tax credits, extended unemployment benefits, etc).  The outcome would have been very similar if not for the many programs that the populous is highly critical of today.

 

http://www.voxeu.org/index.php?q=node/3421

 

At the height of the crisis, the inital five months from June 2008 to October 2008, no one in their right mind would have thought that the outcome would have been as fortuitous as it has been...this is lucky!  Count your blessings we didn't see the 100-year storm!  You have some people working for food, but most don't because their unemployment benefits were extended almost 24 months.  The deleveraging process isn't over...we still may see alot of people drifting from state to state looking for work, as it will take years to get unemployment back to the lows of 2006-2007.  Cheers!

 

 

[watsa_is_a_randian_hero]

 

Also, QE is definitely not wealth redistribution.  I need a citation from a credible source, Watsa.  

 

 

QE = Inflation  (this is the whole point, search any source you'd like)

A surprise or unexpected increase in inflation can create wealth redistribution from creditors to debtors  (this is also obvious)

[Munger]

Of course Buffett is correct.

 

But you can only afford to ignore the macro when Mr. Maket is offering a high margin of safety.

 

Buffett has always said that the three most important words in investing are....margin of safety.

[twacowfca]

In the interest of conserving your time I will make this short as well.

 

1) Putting your explanation of basic economic definitions aside, you have disregarded the fact that over time there is more money in the system which affects everything.

 

2) Hate to burst your bubble but you are not Charlie Munger, so saying my statement was crazy is not a sufficient answer. The bottom line is enterprises earning decent returns on capital deployed will always earn more money. And when central banks print more money the first ones to benefit are such businesses.

 

3) Again, making me feel that you are running a paper portfolio. In the real world when deploying a significant amount of capital you must actually get filled on your order. So when building a position it is imperative to get a "feel" for the stock and see if you can accumulate a decent position. Unless you are just trading multi-billion dollar companies in which case I don't see where the alpha is coming from.

 

I did not get a response to the most important talking point which was the fact that your basis for valuations and "blood on the streets" is based on the reading of historical material which may or may not put everything in context.  

 

Very disappointed with your response! I thought it would have more meat on it.

 

The funniest thing is, that I agree with the idea that prospects are grim but I have also been deploying capital for decades and know that it is quite frankly a terrible time right now in the world. Not saying things won't get worst, but they are definitely not good, or great... They are bad. And so naturally there are some good opportunities presenting themselves.

 

Good Luck to you too! We are up 12% on the year!

 

 

 

 

 

Why only 12%?  Size?  

[Munger]

I had to move on when I read the assertion "inflation is wealth redistribution."

 

Inflation destroys the masses.

 

And deflation is not a bad thing.  Folks who speculated with debt and/or lived beyond their means need to be accountable -- this is capitalism.  Deflation also clears the system of bad debts, restoring the economy to a firmer foundation from which to grow.   Hard work and thrift would be restored as virtues in our country.  No one ever mentions the massive downturn in the US economy post WW1 because the pain (which was significant) was over quickly and the economy then moved forward.

[Guest broxburnboy]

It's one thing to take issue with his macro views, but to label him "nuts" is more suitable  for a sound bite on Fox News, than an informed discussion.

 

Hi Broxburn,

 

The Sprott comment was tongue in cheek.  I thought I put a smiley face on the end of that exclamation point but I guess I didn't.  He's a gold and commodity bug, which is the complete opposite of what I would do, thus the "nuts" comment.  Cheers!

 

Didn't mean to snap.. too many diet cokes on an empty stomach... Cheers

[twacowfca]

During periods of hardship or despair there will be, and has always been exceptions to the rules, those special stand outs who defy logic and capitalize on the woes of mass audiences. Look at two Buffett companies who did such a thing during Katrina, for example.

 

http://www.lexisnexis.com/Community/LitigationResourceCenter/blogs/litigationblog/archive/2010/03/31/defendants-prevail-in-2nd-formaldehyde-trailer-litigation-bellwether-trial.aspx

 

Some here like to point towards shining stars of GD1, like Templeton, or Baruch, that consummate INSIDER and political hack of the period. Kennedy might be another as is Rothschild, although when you point to a "central banker" you are pointing to a dictator of "money supply" who will have their way on pricing directions because of their "control."

 

There are many reasons why certain people succeed wildly versus others which go beyond "the fix" which is absolutely what the "stock market" is mostly about.

 

Take golf as another example. How many Woods' have there been, or will there be time perpetuity?

 

You see, eighty percent of US households are one pay check away from bankruptcy, and that's no lie. Historically, they have managed to stay afloat by this borrow and spend INFLATION MACHINE all while the capitalists ROLLED UP and AWAY important production facilities abroad so that ultimately, their unsubstantiated, valueless paper currency will be scorned by trading partners, and mourned by its more serious stewards who have a basic understanding of about what I imply.

 

Additionally, the atrocities which continue to be committed by their political bodies, a group of > 500 people in all (3) government branches influenced and controlled by the same dubious bankers who took the taxpayers' loot and ran, is so blatant and outrageous, that even the simplest of men know they've been duped. Those type of mental scars do not go away quickly, as has been cited here. They fester and linger and work in a virtuous cycle, one I described as a "negative feedback loop."

 

Historically, those WOUNDS are only contained via the outbreak of banker incited wars! I suspect this won't be different this time, whilst referring to another Great War of global proportions.  

 

 

Some men here like to talk about twenty and thirty year periods of famine, where psychology acts as an albatross for more stingy valuing metric sticks. When you examine this time period deep inside the caverns of your minds, as though it's an easy mark to endure consistent, persistent, sustainable success stories for any part of your lives, reflect backwards during the past twenty and thirty year periods of your life for answers to how unpredictable it is, and will remain going forward.

 

At the same time, always remain mindful of "time perception" and the speed which such lives wither away on this earth as a result of time/experience base.

 

When I was five years old, one year seemed like such a long period of time! It no longer does at fifty! Life is short, so don't forget to smell the ROSES along the way!

 

Anyway, which one of you MONEY MONGROLS will it be who stays alive long enough to be rewarded sufficiently according to Rule 72, which must have massive INFLATION for its ultimate benefits? Who is greatest amongst you to be that top ten thousandth of one percent percentile winner? Parsad, is it you?

 

I recommend you eat more FIBER, and stay extremely lean and healthy! ;D

 

 

 

Did you eat the "musical fruit" today?  :)