Gyroscopic Investing

doodle's Chicken Little act finally got to me and I went out and bought some TLT August 97 calls.

I picked them up for .75.

Maybe my bravado in taking the other side of his trade will help loosen up his thinking a bit.

Impressive!  Note that you lose "bravado points" if you hedge it with leather chaps and sawed-off shotgun futures.

TennPaGa wrote: I really like the phrase "I did it for doodle".

It's the truth.

I sincerely hope that is profitable for you. Actually I think that is a pretty smart short term debt ceiling trade. Longer term I still think you would be better off with some puts.

I hope I haven't become a contrarian indicator

Excellent lecture from Richard Koo on why we have contracted Japan's economic disease — a 'Balance Sheet Recession'...

http://youtube.com/watch?v=OWGDWYB5KZ0

(Hint: Flip the resolution to 720p or higher to see the slides clearly)

You can also flip through the slides here.

Some striking similarities between our two countries.

Richard Koo is always thought provoking, though he never quite gets to the part where any of the sovereign debt is paid back.

Maybe that's the point--in his world tomorrow never comes; it's always an abstractin kept at bay by ever more elaborate central bank maneuvers.

doodle wrote: I sincerely hope that is profitable for you. Actually I think that is a pretty smart short term debt ceiling trade. Longer term I still think you would be better off with some puts.

I hope I haven't become a contrarian indicator

What puts would you buy?

Puts on good ideas and clear thinking. I'm buying calls on more stupidity.

MediumTex wrote: doodle's Chicken Little act finally got to me and I went out and bought some TLT August 97 calls.

I picked them up for .75.

Maybe my bravado in taking the other side of his trade will help loosen up his thinking a bit.

I love it.

MediumTex wrote: doodle's Chicken Little act finally got to me and I went out and bought some TLT August 97 calls.

Why $97?

Adam1226 wrote:

MediumTex wrote: doodle's Chicken Little act finally got to me and I went out and bought some TLT August 97 calls.

Why $97?

I just liked the risk/reward of that trade.

I just sold my TLT August 97 calls for 1.60.

That's a 113% gain in three days.  Probably the best trade I've ever made.

I did it for doodle.

Folks... it's over... MT is now a day-trader.  Prepare for few posts while he runs his VTI, GLD, TLT futures contracts scheme.

moda0306 wrote: Folks... it's over... MT is now a day-trader.  Prepare for few posts while he runs his VTI, GLD, TLT futures contracts scheme.

Nah.

I told you, I did it for doodle.

MediumTex wrote: I just sold my TLT August 97 calls for 1.60.

That's a 113% gain in three days.  Probably the best trade I've ever made.

I did it for doodle.

Nice trade. Have you read the Black Swan yet MT? I just finished it and I bet you would love it.

melveyr wrote:

MediumTex wrote: I just sold my TLT August 97 calls for 1.60.

That's a 113% gain in three days.  Probably the best trade I've ever made.

I did it for doodle.

Nice trade. Have you read the Black Swan yet MT? I just finished it and I bet you would love it.

Oh yeah.  When it first came out.

I've written a lot on how Nassim Taleb's thinking compares to Harry Browne's.

Here is a summary:

Nassim Taleb would stand in the middle of the neighborhood and shout through a bullhorn: "Lightning can strike anywhere at any time.  It is impossible to predict when it will happen, but some of your houses will be struck by lightning sooner or later.  I just wanted you all to know that."

Meanwhile, Harry Browne is going door to door selling affordably priced lightning rods, with simple easy to understand installation instructions.  When asked by residents whether this means that their homes are going to be struck by lightning, Harry Browne responds in a friendly voice: "We live in an unpredictable world.  Although it's probably not worth getting too worked up about, installing one of these lightning rods may give you some peace of mind.  I have one on my house."

***

In a nutshell, that is, to me, the difference between Nasim Taleb and Harry Browne.

MT,

I'm beginning to wonder whether your analogy-creating machine is as bottomless of a pit as the Japanese debt/GDP ratio.

Haha, that is so true MT.

They both recognize an unpredictable and dangerous world, but offer radically different solutions. I much prefer the HB slow and steady gains compared to Taleb's asymmetric payoffs.

Here is how smart I am:

I bought TLT August 97.00 calls last Tuesday (I think) for .75.  On Friday I sold them for 1.60, making a nice 113% profit in a few days.

If I had waited until today to sell those calls I would be getting 7.55 for them.  That would have been a 10-bagger in 9 days.

Perfect entry point, bungled the sale, left lots of money on the table.

I keep reminding myself, though, that I did it for doodle.

You can subscribe to my investment newsletter. 

MediumTex wrote: Here is how smart I am:

I bought TLT August 97.00 calls last Tuesday (I think) for .75.  On Friday I sold them for 1.60, making a nice 113% profit in a few days.

If I had waited until today to sell those calls I would be getting 7.55 for them.  That would have been a 10-bagger in 9 days.

Perfect entry point, bungled the sale, left lots of money on the table.

I keep reminding myself, though, that I did it for doodle.

I'm still kicking myself for not having the guts to buy those August 15th GLD 155 call options for $0.50 a few months back...  I would have made about 1000% returns on that one as well...  and I was going to put $10K into it... lol...

Why do I have a feeling that right now would be a good time to "do it again...for doodle?"