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Trading Relief and tiny light for hopes!

Discussion in 'Shares' started by wdongli, 30th Sep, 2011.

  1. wdongli

    wdongli Well-Known Member

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    All can be changed but human minds are hard to change once they have been formed and asserted by some popular themes. It has been shown in GFC crash and V-type recovery.

    So all of psychological books said it is extremely hard to fix the depressed disorder without slowly and painful recover especially the disorder have been in contagion after more and more have been hurt by the events people have never liked to accepted.

    There will be a long way to recognize the lights which is allusive and buried by the still heavy darkness as the early light when the Sun starts its rising from the horizon. I believe the rising Sun but I don't know when the lights could be strong enough to let everyone see.

    I have being monitored some early light microscopes, such as VIX, ECRI leading index, and soft-landing process in China. However I do feel the life logic and common senses is most important. Environment is very important and will affect the war process even it is not the decisive element for our failure and winning.

    Waiting for more lights appearing in the horizon is painful and gut crunched. It needs peaceful minds which need the cash reserves and income to back up. With peaceful minds, you could dig deep into your minds, find the ways to play the qualities which could sustain the pressures after you are recovered from this disasters and crisis.

    Don't put too much hopes for another V-shape recovery which we could not control and really depend on what the big boys in XAO to see the future. As retail market business people we have to learn how to retreat, how to move forward to the edge of the valley of death where has been filled in full by the bloods and limps from the warriors and a lot of them have been trapped there. However we have to realize that we need the safety first since if you are in risks you could not service the warriors but commit you in a war no one could win.

    Don't pretend you are better just because you never take risks in the market. You could be just coward as a lot of crowd who never dare to take any chances. If you have been hurt in this crash, it is the time to consolidate and sort out your minds.

    Have you been ready to wait patiently? If anyone could sell in April and is very busy to shop for gold and gems, solute sincerely to you! You are wise fools with the guts and intelligence. I would try to catch up with you since I like you to be my comrades to save more warriors from the valley of death in next cruel contrition war in GFCII, GFCIII, or GFC100 if we could live for so long.
     
  2. wdongli

    wdongli Well-Known Member

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    Right, no EU default, but how about China?

    All of people in XAO is very cool now since they are bargain hunters, who could be day-trade type or cigar-butt-picking type, crash-shorting type, but definitely not trader followers, just for the unavoidable worst case. So EU not default now is not enough, how about tipping off of china? If US credit crisis could bring EU down, it is highly likely that it could bring China down.

    Actually shorters are using microscopes to check China to see if it could generate anything which could result in the panic for the tipping off, true or false. Yesterday a few big articles for the troubles in China are the signs what the shorters are expecting. Don't curse the shorters which are the part of the wild market.

    However China still has a long way to be transparent enough. The Chinese Stock Market is a huge Casino with more gamblers than XAO. Its stock market still could not be the barometer of the China economies. The randomness have played significant parts to drive the share price up and down. China could go so far mainly because its extremely cheap labors who left their home in remote villages and the wild market forces which desperately want to make the living any better than that for mouths only. 80% of the population in China still live with means which formed in the poor life for hundreds of years.

    Corruption and troubles never leave China alone even in the time all of workers were the masters for their society and future(actually pig society with pig chief who controlled all). Not too long time no gamblers in China at all. Didn't be allowed. Wild market gives the motivation to work for ordinary but not great people. The communism ideology works to purify the soul for heaven. China in my view is in its better balanced way and more tilted to the market economies day by day.

    The huge spending in GFC had the back up of huge reserves. When all of the world is not good, China would have more trouble but its monetary and fiscal policies are still manageable. Yes if some abruptly extremely bad events could drag its economies but I don't believe the financial statement could tell China will tip off or not. We all dislike the dictatorship but in worst case the unity could sustain more pressure than the people live in the societies of socialism or not very fundamental capitalism societies.

    All of China like saving and could not forget things could be worse and much worse. In my view, it is a not bad sign a lot of people in China just gamble in the legal Casino. They play the zero sum game in short term. If XAO has struggled for 26 months, China has done so. EU is in worst case; US is in worst case; China should make its own worst case; and then Australia should make its own worst case too.

    No worst case no life in XAO because the shorters need the worst case and the wild market forces expected the worst case. But each wild field could be different and now we have the internet by which you could guess what would be in the remote villages, ghost cities with the empty ghost new houses, and image if all could spend as those in US, EU, and Australia, what the future should be.

    No one worries about India in XAO at moment. Could we hear some people cry for India's tipping off? It is the world you could find the trouble and all of us believe the trouble. Yes, what if India tips off?...

    Let's our guess for the future of the still not transparent Middle Kingdom who seems still in the cruel hands of the emperors. The fact is not like that. I am not a political extremist but all of my mind about the society mainly was formed by the turbulence of the cultural revolution and the door-opening time. No too many in my ages would like to die for anything but let the economy reach to some level. The society should be the society of the fools.

    Have you heard the 89 Massacre in Beijing? Most of people fed up to the turbulence and youth has not grown up enough to control the future. In the die-hard saving society, the risks for credit crash is less even possible. How about 5 years later I don't know. How about the probability for China tip off? I could not see in a year or two. Could we expect XAO would be shorted by the shorters for another years? If so, Australia would tip off with the world.

    Don't assume I am predicting China would never tip off. It did regularly for nearly 400 years. From the regular tipping off to a stable society, I feel good and bad things would mixed together with a lot pitch covering. It is fearful but it also make a lot of gamblers very rich. Fair? It is not! When the fundamental capitalism is a bud in a society, you could not cut the bud by the name of fair since no cheap labors and some exploration all would be in the wild and played by the pig chiefs. However fundamental capitalism opens the door for a better economy and fair society.

    All of us need to read "Open Societies and its enemies!"

    Don't laugh me for my hope: I hope when I work hard to see which spade I should pick up after I left my last office 3 years ago, BKP and ARH just shoot up dramatically not because fades but the huge resources or huge money in their hands. The drilling in a quite huge basin for shale oil and the agreement to build a billion dollars' IO project are the matter for dying or rebirth in a second. We have a not very corrupted system. Most of gamblers don't want to be in jail since inside trading. So all of people around them just guess what would be! 50% to 50% odds at least!

    I hope China not tip off at least before November when US stock market should try to find good news for the upward trend for days or month even difficult for years.
     
    Last edited by a moderator: 30th Sep, 2011
  3. wdongli

    wdongli Well-Known Member

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    Basic rules which never and ever broken!

    1. No harm and no loss in worst case

    2. Quality(to be survival in holding time period) + cheapness = buy

    3. Lowest tail of price probability distribution = Cheapness

    4. Economic moat of business = Margin of Safety

    5. Never Speculation = buy in bloods and ruins when all are depressed

    6. Never timing = Buy when all believe no tomorrow


    ***
    Just some distilled points about environment and basic rules:

    1. No loss is easy to say but hard to do.

    2. Reality can be worse and much worse than expected worst case.

    3. All have their catches. Profit is never a problem. Loss in pains and hang over the hell with a hair is a problem.

    4. With big profit, never forget to check the temperature of the heads.

    5. Lessons can be forgot easily.

    6. Insanity can be repeated with carelessness.

    7. Making pennies from dollars is easy.

    8. Getting life from dollars is hard.

    9. Luck is few but necessary.

    10. Vertical shooting makes bullets hit the shooter.

    11. War consumes the warriors

    12. Cheap + value = buy.

    13. Over-optimism || no margin of safety = sell

    14. Anxiety after huge party = sell all for cash

    ***
    How to quantify and qualify the conditions and contexts to hold the rules? How always to be sane and intelligent with a good enough latices of mental network and clarified boundaries for what KNOWN and what UnKnown?

    Put the toes in Unknown extremely alert and dance to work in the Known with great prudence and extend the Known safely and effectively without self-confusion.

    What's the line we should never cross in quantity with the support intelligence rather than feeling and guesses? Market, the war place, is really risky and thrilling. How to laugh for years, decades, or until you could not think anything good enough?

    To service the warriors in our best we have not be the warriors and we should not just operators of some home-made or advanced systems!

    We should not join any wars but we have to be the bravest warriors to fight against ourselves since we were born as warriors and educated as warriors for different duties.
     
  4. wdongli

    wdongli Well-Known Member

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    After beaten painfully warriors have to choices but...

    The last decade is years when both retail and institutional warriors lost a lot after some bullish themes failed such as new era due to Internet popularity and decoupling for emerging and advanced economies. The fact was new era pushed the door for IT bust, which made a lot of genius lost their shirts or bared bodies after tides conceded.

    The fact was decoupling made coward Aussie retail and institutional funds lost 50% -80% clients' capital in the GFC crash. Most of retail and institutional gamblers lost their guts for the capital gains. Actually no too many could get the capital gain they wanted.

    How many people have confidence for the super funds, which are contributed by their bosses and themselves before GFC and after 2006's government budget. How many sold their houses and put the money into the super to get high capital return with favorite tax benefit? It did happen in the market became thrilled by the dreamed resource booming but the consequence is half their life saving gone.

    This might not initially strike you as that big of a deal, but it is. Most investors who are active today cut their eye teeth during the go-go years of the 1980s and 1990s, when dividends were considered to be little more than an afterthought. Price appreciation was the name of the game. In fact, many of the most widely-held stocks paid no dividends at all.

    But what we’re seeing today could very well be heralding the return of the pre-1958 era in which the market’s dividend yield was consistently higher than that of 10-year Treasuries. In that long-ago era, the bulk of stocks’ total returns came from dividends. Price appreciation contributed relatively little to that total return, if anything at all.

    Seriously asking yourselves how much have you got in the last decade from the capital gain? We are not wise but we are clever enough. We don't want to be beaten in the corners let alone one after another. Environment change the mood, behavior, and expectation of market crowd. They would like to choose the safety heaven for their capital and would like to get more yielding to compensate the loss in cash flow. Why do you move into resource sector? Why do you move to the sideline after GFC? Why is XAO so frantic to trade for days' earning?

    All fear to be beaten again. All fear to lose the shirt again. All count any little risks into the consideration and then we could hear the curse to the "buy and hold!" You don't dare to buy but you would sell even for 4% profit and get little after the tax.
     
  5. wdongli

    wdongli Well-Known Member

    Joined:
    31st Mar, 2010
    Posts:
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    After beaten painfully warriors have no choices but...

    The last decade is years when both retail and institutional warriors lost a lot after some bullish themes failed such as new era due to Internet popularity and decoupling for emerging and advanced economies. The fact was new era pushed the door for IT bust, which made a lot of genius lost their shirts or bared bodies after tides conceded.

    The fact was decoupling made coward Aussie retail and institutional funds lost 50% -80% clients' capital in the GFC crash. Most of retail and institutional gamblers lost their guts for the capital gains. Actually no too many could get the capital gain they wanted.

    How many people have confidence for the super funds, which are contributed by their bosses and themselves before GFC and after 2006's government budget. How many sold their houses and put the money into the super to get high capital return with favorite tax benefit? It did happen in the market became thrilled by the dreamed resource booming but the consequence is half their life saving gone.

    This might not initially strike you as that big of a deal, but it is. Most investors who are active today cut their eye teeth during the go-go years of the 1980s and 1990s, when dividends were considered to be little more than an afterthought. Price appreciation was the name of the game. In fact, many of the most widely-held stocks paid no dividends at all.

    But what we’re seeing today could very well be heralding the return of the pre-1958 era in which the market’s dividend yield was consistently higher than that of 10-year Treasuries. In that long-ago era, the bulk of stocks’ total returns came from dividends. Price appreciation contributed relatively little to that total return, if anything at all.

    Seriously asking yourselves how much have you got in the last decade from the capital gain? We are not wise but we are clever enough. We don't want to be beaten in the corners let alone one after another. Environment change the mood, behavior, and expectation of market crowd. They would like to choose the safety heaven for their capital and would like to get more yielding to compensate the loss in cash flow. Why do you move into resource sector? Why do you move to the sideline after GFC? Why is XAO so frantic to trade for days' earning?

    All fear to be beaten again. All fear to lose the shirt again. All count any little risks into the consideration and then we could hear the curse to the "buy and hold!" You don't dare to buy but you would sell even for 4% profit and get little after the tax.
     
  6. wdongli

    wdongli Well-Known Member

    Joined:
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    New possible psychological patters in future

    It seems market or XAO is in a new journey to a new road. Could we see some similar pattern shifting in history?

    If we know history of yield and capital gain since 1927 for both the stock market and fix-price investment such as bonds, the key factor in understanding them was the market crowd expectations of the markets’ relative volatilities.

    Between 1950 -1956, market warriors expected the stock market’s volatility to be much greater than bond market volatility. To let warriors put money the great volatility, the stock market had to provide a higher yield than bonds. All needed some cash or equivalent to cash for safety or at least let them safe.

    However anything if chased by crowd the thing would sooner or later would go in its opposite. However once the cash or cash equivalent big enough market warrior would feel safe and try to get high capital gain. To get money for business from market, the dividend yieldings from stock market must be lower and lower in raise share price. And that is why the stock market’s yield have to drop below that of bonds, and stayed there for decades.

    ***
    The exist stock market’s extraordinary volatility has so traumatized warriors that they now need a much higher dividend yield to make holding equities an attractive proposition. Will the current situation persist? It depends greatly on what the warriors expect about the relative volatility. However it is hard to give a exact prediction.

    Warriors’ memories live for a very long time if the losses are huge. The memory of the Great Depression lingered for years after it ended, for example, which is one reason why stocks’ dividend yields remained so high for so long.

    What could we expect now from human nature? After warriors in XAO were beaten in IT bust and GFC resource price crash, the recent market volatility would persist for longer. We need to prepare for an extended period in which dividends become one of the central preoccupations of the market.