Category Archives: Psychology

Preserving My Sanity

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If I was completely dependent on the market for my mental health, I would have made myself into a six foot tall Christmas ornament hanging from a coniferous tree long, long ago. To be sure, the market influences my disposition: I’m about fifty times happier than normal (a very tiny starting figure, certainly) when the market is getting killed. Over the past seven years, this has happened approximately never. Indeed, even the most recent history of the market looks like the chart below: it is either (a) going up quickly, or (b) it’s going up slowly. This is what markets look like when the VIX is approaching single digits, people.

0722-es

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Robbins’ Egg

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About a week ago, I mentioned in the comments section that a new documentary appeared on Netflix called I Am Not Your Guru, which is about Tony Robbins. Now, I’m familiar with who Tony Robbins is, because it’s pretty hard not to be if you live in the U.S. At first, I thought it would be some kind of tell-all take-down of the man, but it turns out it’s pretty much a two hour commercial for the guy (he did, after all, have total approval over its content).

I found it terribly interesting to watch, however. I tend to view the whole New Age-y, Self-Help-y, Personal Empowerment industry to be pretty vile. It strikes me as shallow, shamelessly opportunistic, and it tries to cloth itself in some kind of spirituality when, in fact, it’s 99% about making a buck. This clown on YouTube captures it nicely (and this isn’t a parody; he’s for real):


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Kobayashi Maru

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On a day like this, when bulls the world over are give each other circle jerks and slaps on the back (hopefully not in that order, since hygiene is paramount), you would expect Tim Knight, the Sangre de Cristo of bears, to be weeping from the cross. Well, things have sucked out loud since that ridiculous Brexit fiasco (e.g. 1 1/4 days of selling, only to be aborted by the CBs worldwide). Indeed, I feel like the bears (correction, bear………that would be me, now castigated even by his own readers) is in a Kobayashi Maru market:

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!!!

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Subtitle: Brexit!!! Silver!!! Bonds!!! Deflation!!!

aliceIt’s a funny title for a segment, but it is appropriate. I don’t want to be too flippant with dismissals of inflammatory market events like ‘Brexit’ as simply hype. There is very real macro fundamental shifting going on behind the hype. But in market management, macro fundamentals play out over long stretches of time and nobody knows exactly how all the moving parts are going to affect the subject of the hype (in this case Britain and the EU), let alone the asset markets we are tasked to invest in, trade or avoid.

This is where market psychology comes into play, hence the ‘!!!’ title. As already noted, I get the feeling that the Brexit drama was an exclamation point on the global deflationary phase that has been in play since 2011, when the acute phase of the ‘Euro Crisis’ first erupted (sending gold to 1900+ an ounce). You may recall that silver and commodities had already blown off and blown out but gold pulled in the risk ‘off’ bid amid a developing deflationary force. It then blew out and global deflation ensued.

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It Must be a Gold Bull Market, Because…

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Dear SoH, I know this is somewhat Gary-specific, or Gary-indulgent, but I like to hammer everybody over the head in none-too-subtle ways now and then…

It must be a gold bull market because…

  • Gold analysts (code for gold obsessives; analysts cover asset markets, including gold), who for years pumped people to be bullish despite an obvious bear market, are now taken seriously again as they issue the same dogma.
  • A Technical Analyst months ago advised “30,000 coffins” would be needed for gold bugs and has since gone quiet while another is bearish, no bullish, no bearish again, no bullish again. Charts are only one component of gold market management, but the TA’s are again enthralling the gold community with lines and squiggles.
  • Yet another gold bug TA somehow manages to tie in cycles and God for a bullish view of gold and silver and a 2016 crash for world markets. There’s a niche for everything, I guess.
  • The major media as well is in obsession mode, as we find out about bullish calls on gold by people smarter than we are, like Soros, Gundlach and Druckenmiller.
  • And to balance it all out, there is a man and his computer advising that gold has not yet seen its cycle lows.

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Market-Be-Gone

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My fellow bloggers are seeing the same thing I’m seeing: people are just leaving the market in droves. Why? Simple. Because hardly anyone can make money consistently in this beast. Just look at the recent activity. Neither bulls nor bears are winning. If you win one day, you lose the next, and vice versa.

I guess I’m semi-grateful that at least OPEX week wasn’t the bullish fiesta that I feared. But as I stand here right now, I’m outlining my first screenplay, because the boredom and insanity of this market action is really starting to get to me, and I need a creative, positive outlet. For once, I’m actually looking forward to the weekend. This market, once again, sucks.

0520-fakery