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The fucking mouse is back. Well, not the same mouse, since I've killed three of them over past months. But A mouse is back. And it smells. And I haven't caught it "in action" yet, so I don't know where it is sneaking through. The bastard.
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I think that it's reasonable general rule that any general rule is likely to be misleading at best and positively dangerous at worst.
"Sell in May and Go Away". Not too good a piece of advice to follow this year. Misleading
"No-one ever went broke taking a profit". Oh yes they did, eventually. As a piece of advice, positively dangerous, advising the taking of small gains when you would perform much better by letting it ride.
(In poker, on advising against a certain play) "By doing this you leave yourself open to a possible difficult decision".
Well, duh. OK, I'll raise all-in with Aces pre-flop and fold everything else. That gets rid of any difficult decisions.
The sad thing is, difficult decisions are your job and the trick is to cultivate them and then get the majority of them right. "Easy decisions" that are probably wrong are the route to the poorhouse. To encourage a move that pot-commits you on the grounds that this makes your decision easier, rather than making a smaller bet that leaves you facing a tougher river decision strikes me as logic of the most perverse kind.
Harrington on Cash Games makes a nice little observation, that, the more confident you are of making the right decision post-flop, the smaller can be your raises pre-flop and the more often you can limp instead of raising. He doesn't join this litany of "avoid tough decisions".
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Bradford & Bingley tumbled way below its rights issue price today (41.5p vs 55p) as the analysts (and what were these self-same guys saying a few months ago?) spotted that TPG had walked away and that Resolution had no interest in coming back. For the first time, voices are whispering "effective failure".
Banks seem to to be resembling football clubs in terms of business more and more. Shareholders in banks have always been at the back of the queue when it comes to credit, so it doesn't make much difference to them that one large chunk of people -- the retail customers -- are no longer ahead of shareholders but behind the banks. But it strikes me as rather odd that if I take five hundred quid and lend it to B&B on an unsecured basis (i.e., open an account or buy a one-year bond) then I have more protection than if I take a share in the ownership by buying an equity stake, or if I lend to the bank on a more formalised basis.
It creates a curious distortion in the market that should discourage the purchase of an equity stake in any UK financial institution. Far better to deposit self-same money in the bank's savings accounts.
Other analysts have now also begun to mention the concept of "valuation". Now the talk is, it doesn't matter if anything is cheap on any logical grounds of measurement -- there's still no point in buying if you think things are going to get cheaper still. One of the stocks I own -- Headlam -- has fallen more than 50% over the past 18 months or so, resulting in a yield just shy of 10%. There's nothing seriously wrong at the company that I know about, and I fully anticipate a reasonable maintenance of dividend. So, should I buy some more?
Well, not if I think that the bear market will continue a way further down than its current measure. Another 25% off? Quite possibly.
Commercial porerty is similar. There's some stonking yields available for cash buyers (and in the retail sector, the temptation to buy entire "built blocks" from distressed develiopers looks like offering a superb long-term yield. But why move in now if the trend is still down?
And this downswing then becomes self-reinforcing. Don't buy because preices will drop further. Prices drop further because you don't buy. Eventually, one of the buyers "breaks ranks" and the cycle turns. But that's a ways away yet.
________________
+++++++++++++++
I think that it's reasonable general rule that any general rule is likely to be misleading at best and positively dangerous at worst.
"Sell in May and Go Away". Not too good a piece of advice to follow this year. Misleading
"No-one ever went broke taking a profit". Oh yes they did, eventually. As a piece of advice, positively dangerous, advising the taking of small gains when you would perform much better by letting it ride.
(In poker, on advising against a certain play) "By doing this you leave yourself open to a possible difficult decision".
Well, duh. OK, I'll raise all-in with Aces pre-flop and fold everything else. That gets rid of any difficult decisions.
The sad thing is, difficult decisions are your job and the trick is to cultivate them and then get the majority of them right. "Easy decisions" that are probably wrong are the route to the poorhouse. To encourage a move that pot-commits you on the grounds that this makes your decision easier, rather than making a smaller bet that leaves you facing a tougher river decision strikes me as logic of the most perverse kind.
Harrington on Cash Games makes a nice little observation, that, the more confident you are of making the right decision post-flop, the smaller can be your raises pre-flop and the more often you can limp instead of raising. He doesn't join this litany of "avoid tough decisions".
+++++++++++
Bradford & Bingley tumbled way below its rights issue price today (41.5p vs 55p) as the analysts (and what were these self-same guys saying a few months ago?) spotted that TPG had walked away and that Resolution had no interest in coming back. For the first time, voices are whispering "effective failure".
Banks seem to to be resembling football clubs in terms of business more and more. Shareholders in banks have always been at the back of the queue when it comes to credit, so it doesn't make much difference to them that one large chunk of people -- the retail customers -- are no longer ahead of shareholders but behind the banks. But it strikes me as rather odd that if I take five hundred quid and lend it to B&B on an unsecured basis (i.e., open an account or buy a one-year bond) then I have more protection than if I take a share in the ownership by buying an equity stake, or if I lend to the bank on a more formalised basis.
It creates a curious distortion in the market that should discourage the purchase of an equity stake in any UK financial institution. Far better to deposit self-same money in the bank's savings accounts.
Other analysts have now also begun to mention the concept of "valuation". Now the talk is, it doesn't matter if anything is cheap on any logical grounds of measurement -- there's still no point in buying if you think things are going to get cheaper still. One of the stocks I own -- Headlam -- has fallen more than 50% over the past 18 months or so, resulting in a yield just shy of 10%. There's nothing seriously wrong at the company that I know about, and I fully anticipate a reasonable maintenance of dividend. So, should I buy some more?
Well, not if I think that the bear market will continue a way further down than its current measure. Another 25% off? Quite possibly.
Commercial porerty is similar. There's some stonking yields available for cash buyers (and in the retail sector, the temptation to buy entire "built blocks" from distressed develiopers looks like offering a superb long-term yield. But why move in now if the trend is still down?
And this downswing then becomes self-reinforcing. Don't buy because preices will drop further. Prices drop further because you don't buy. Eventually, one of the buyers "breaks ranks" and the cycle turns. But that's a ways away yet.
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