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James A. Kostohryz

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  • Gold: More Than A Real Store Of Value - Recent Evidence [View article]

    I have read your insightful book and now realize that my last comment did not fully grasp what you tried to explain to me in your previous comment. Reading the book has made your comments clearer to me and I now understand better what you meant about the problem of the start and end points being less important in the context of your theory.

    Having understood that, it is also true that RYT, by its very nature, also has implications for long-term interest rates. And what I was trying to flag in my comment -- which I think was not stated very clearly on my part -- was the prospect of a mean reversion from negative to positive real interest rates (as suggested or even necessitated by RYT). This would, in turn, have implications for the gold price model.

    There are a slew of other things which we could discuss that might be relevant to a full fleshing out of the implications of RYT gold pricing in the current context -- such as slowing global population growth, slowing real GDP growth and a trend towards gold production growth that is outstripping population growth that is likely to persist for many years. I also think is profitable to ponder vis a vis your model the relationship of risk aversion to things such as PE ratios and the relations amongst the demand for various assets such as money, gold and treasury bonds. I think there are some very interesting relationships there vis a vis elements in your model. But I'll save that for some other time and another place....

    Sep 5 02:10 AM | Likes Like |Link to Comment
  • Short Sellers And Seeking Alpha [View article]
    Excellent analysis of the issue, Behavioral Economist. One of the most incisive ones I have read.
    Aug 1 06:41 PM | 2 Likes Like |Link to Comment
  • Short Sellers And Seeking Alpha [View article]

    I think it would be best if you thought in terms of "pump" articles.

    You clearly don't like it when short sellers "pump" an article down. Presumably you should be EQUALLY against longs "pumping" an article up. Correct?

    Now suppose there is research that is well done that makes a strong case for a stock being undervalued. Presumably that should be OK by you. By the same token I would think it would be OK if there is research that is well done that makes a strong case that a stock is overvalued. Correct?

    I think that what you should be worried about is unethical "pumping" of stocks in general -- whether by shorts or longs. There is absolutely no reason for you to be more against short pumping than long pumping. Nor is there any reason whatsoever to believe that there is more short pumping happening on SA than long pumping.

    Now, your bring up a point about small versus large investors. If a small investor is not able to competitively ascertain whether an article -- long or short -- is a "pump" article or not, then they really have no business investing in individual stocks. They should invest in mutual funds and leave it to the professionals to sort it out.
    Aug 1 06:38 PM | 14 Likes Like |Link to Comment
  • Short Sellers And Seeking Alpha [View article]
    Note to self:

    James, don't ever write a negative article on SA or anywhere else UNLESS you are short the stock and expect to make lots of money from that short position, because the abuse that will be heaped on you by immature, hysterical and vindictive amateurs cannot possibly be worth it unless you stand to profit handsomely from getting your well-researched and honest negative thesis out there.

    No more negative articles on individual stocks merely to inform. If there is no prospective profit to be had from a negative thesis, don't bother.

    I am writing this down so that I won't forget it.
    Aug 1 11:34 AM | 10 Likes Like |Link to Comment
  • Notes On Yahoo's Strategy [View instapost]

    I don't know what the details are behind Yahoo Finance's strategy. But it really does look like the move to produce proprietary content via Tumblr was hastily done. I think they would have greatly improved their chances of making that work if they had given themselves more time to set the whole thing up. As it is, the whole set-up looks second-rate.

    Given the immensity of Yahoo Finances user base, I don't think anybody can count them out in terms of creating a strong contributor network. But right now, it seems that they have gotten off to a shaky start; it looks like a wasted opportunity for them.

    As far as SA is concerned, it's a whole new ballgame now ex-Yahoo. I have been extremely impressed by the managerial acumen shown by you and your team in the past few years, and I am excited about what you guys are going to be doing in the next 12 months.

    This is going to be the challenge of a lifetime. And I, for one, think you are up to it.

    Aug 1 12:55 AM | Likes Like |Link to Comment
  • Announcing SA's First Outstanding Performance Award Winners [View article]

    "the concept of PRO articles is contemptible."

    Asking that customers pay for extra value provided is contemptible?

    What, in fact, seems contemptible is the notion that anybody is "entitled" to receive for free something that is produced with considerable professional effort.

    If your concern is that "I won't have access to some of the "best" articles until I have less time for long-term compounding to benefit from them," you can consider cutting back on your current consumption or taking out a long-term loan. But don't complain that it is "contemptible" that you are not given something for free.
    Jul 28 01:24 PM | 13 Likes Like |Link to Comment
  • QE To Propel Market Treacherously Higher After Taper Ends [View article]

    The anecdotal evidence I am hearing from folks like you, jives with what I am seeing in the data. All that excess liquidity is starting to MOVE. In the end, it's not the excess liquidity that causes economic activity, it is the shift in PREFERENCES. On the margin, people are preferring to devote more of their cash balances towards investing and consuming rather than hording said balances.

    Jul 22 02:04 PM | Likes Like |Link to Comment
  • QE To Propel Market Treacherously Higher After Taper Ends [View article]

    Good question. In the article I mention that this has already been going on for a while, as you point out. However, most measures of risk aversion and liquidity preference that I use point to the fact that they are still early in the process of recovering from historic lows. I discuss this in a previous article. Thus, to the extent that the economy continues to improve -- as I think it will -- this process of declining risk aversion and liquidity preference will continue.
    Jul 14 06:06 PM | 1 Like Like |Link to Comment
  • QE To Propel Market Treacherously Higher After Taper Ends [View article]

    I am shooting for a fall 2014 launch of my full site. Sorry about the delays. Once I launch, I am all in.
    Jul 14 06:03 PM | 1 Like Like |Link to Comment
  • QE To Propel Market Treacherously Higher After Taper Ends [View article]
    "...whenever that was." I officially called off my bear call on Europe in August of 2012.

    That was a while ago, David.... :)

    P.S. I think my preview of the World Cup final was pretty on target, if I do say so myself.... :) Argentina almost pulled that off with their defensive counter attacking strategy that exploited lack of speed in the German back line.
    Jul 13 10:25 PM | Likes Like |Link to Comment
  • QE To Propel Market Treacherously Higher After Taper Ends [View article]
    RSO55 and Carlos:

    Much of what you say has merit, but it really is not very relevant. Nobody that knows anything about economics thinks that supply and demand curves are strait or that they are 45 degrees. All economists know that they are dynamic and shifting all the time. Everybody also knows that they interact. Thus, you are not saying anything that is novel or that adds anything to extant economic theory.

    The specific point at issue here is whether the price of money relative to certain goods (such as stocks) is affected by the supply of money and the demand for it. I say it is, and I have made my case in a series of articles, including this one. My argument is based on a number of sub-arguments. ONE of the sub-arguments has to do with the theory law of supply and demand as applied to money. This aspect of my argument is near irrefutable. You guys deny it, and are certainly free to do so. But that is the equivalent of denying the law of gravity -- or at least denying that it applies in some particular instance.

    When you deny a clearly established principle (such as gravity or supply/demand), it is incumbent on you to present theory and evidence and neither yourself nor Carlos have. All you have said is that you don't believe it. You have also said some fuzzy stuff about "garage economics" and other demonstrably nonsensical things such as the notion that liquidity and liquidity preference are one and the same thing. Fine. If you guys want to persist in thinking that those are good counterarguments to the law of supply and demand as applied to money, be my guest.

    Now, mind you, I have not said anywhere that the only thing you need to be able to predict price movements (of stocks or any other good) is to understand the concepts of supply of liquidity and liquidity preference. There is obviously much more to it than that. What I AM saying is that this is a key factor and that if you don't understand that, you really don't understand anything.

    I am going to leave it at that, RS055 and Carlos. I have made my points. You guys, as well as everybody else, can make their own decisions about whether you think what I have said is useful.

    I appreciate your interest.

    Jul 13 02:23 PM | 1 Like Like |Link to Comment
  • QE To Propel Market Treacherously Higher After Taper Ends [View article]

    As I pointed out in the article, the Fed has already said that they are unlikely to sell any of those bonds any time soon. This creates the problem you are alluding to and which I discuss in my article.
    Jul 13 01:20 PM | Likes Like |Link to Comment
  • QE To Propel Market Treacherously Higher After Taper Ends [View article]

    FYI, I really don't have a full site up yet. It is simply a free newsletter at this point.

    As far as determining whether you might like it, you can freely peruse over 100 articles I have written for SA. The site contains articles I write for SA and other sites plus exclusives that are only published on my newsletter. these exclusives are generally more detailed reports.

    Registration is free. If you don't like it, you can take yourself off the list, no problem.
    Jul 13 01:17 PM | Likes Like |Link to Comment
  • QE To Propel Market Treacherously Higher After Taper Ends [View article]
    Hi David:

    Of course I don't mind your commenting, David. I welcome it.

    "I was on the other side of your doom and gloom calls over the last few years..."

    I sort of doubt whether you have read much of what I have wrote in the past year and a half since I have bullish on the market since late 2012.

    Please feel free to share with the forum why you disagree. I'm sure folks will be interested to know.

    As far as the world Cup, Germany has clearly been the better team in the tournament thus far. But Argentina could pull it off. I believe they are going to play a very tactical and defensive game as they did against Holland and rely on counterattacking. The German defense is vulnerable to this sort of strategy since they come forward in big numbers and their back line plays very advanced. Plus their back line lacks speed. So they could get caught. I think Argentina has a better chance than the oddsmakers are giving them.
    Jul 13 01:11 PM | Likes Like |Link to Comment
  • QE To Propel Market Treacherously Higher After Taper Ends [View article]

    The theory that the price of any good -- and that includes money -- is influenced by the interaction between supply and demand is about as proven as any scientific theory is or can be. People can ignore it at their peril.

    Jul 13 12:57 PM | 1 Like Like |Link to Comment