Tuesday, January 03, 2006

Balance And A Bit Of Vision

It is easy to get wrapped up in a market view.

Inevitable can be a long way from immediate.

The US has been in financial trouble for a very long time.

There is no way the markets should not have crashed, and the economy imploded by now.

It didn't happen.

It may happen tomorrow, it should have happened a decade ago, it may not happen for years.

As a speculator you sometimes get wrapped up in the spectacle and slip into anticipation.

That is the time to take a step back and listen to folks you respect that have a different outlook.

Here is an update from PIMCO, a most successful investor in debt. I look at what is going on in the world and expect doom; PIMCO looks and sees profits. I respect their analysis, and will use it to balance my outlook.

Here is a nice speculation rule:

You can be absolutely right on the speculation but a bit wrong on the timing; and lose.

I will play the speculation, but rules and experience - and smart people on the other side of the trade, will help me keep small.


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