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  • The Day I Sold Everything [View article]
    Like it! On top of that the only winning long term strategy is investing long term. Selling all stocks after holding for just three years is an imprudent attempt to time the market.

    It's particularly dangerous to try to time the market based on flimsy observation about the macroeconomic picture and misunderstanding of monetary economics.
    Jul 27, 2014. 04:37 PM | 4 Likes Like |Link to Comment
  • The Day I Sold Everything [View article]
    > What will replace your capital when the market tanks?

    He bought three years ago... And why would the market tank if the S&P 500 companies are having record profits even if the economy has only started to recover.

    (Please don't give that bullshit about QE.)
    Jul 27, 2014. 04:30 PM | 1 Like Like |Link to Comment
  • Bulgaria's Strange Bank Run [View article]
    So if I understand correctly you dislike public power, i.e. central banks, interfering with the self-correcting and all powerful efficient market that, if left to itself, will cure all ills?

    And another question: where do you think money comes from? Or should come from? Clearly, you don't believe it comes from 'proverbial mattresses', right? In your world, would money be created by the private sector (commercial banks) or by the public sector (central banks)?

    And let me clarify this: if you dislike central bank's power to create money then you should love private money creation and hence the fractional reserve system.
    Jul 27, 2014. 08:02 AM | 1 Like Like |Link to Comment
  • Chicago Bridge & Iron: Why You Should Grasp This Rare Opportunity [View article]
    The absurd things is that apparently nobody knows for sure...
    Jul 25, 2014. 05:53 PM | Likes Like |Link to Comment
  • Bulgaria's Strange Bank Run [View article]
    User 424270, I don't agree.

    You somehow think that fractional reserves is the source of all evil. While in fact factional reserves is just a way of making the monetary system simple. Without fractional reserves banks will not be able to create money. But that role will be taken over by the Central Banks and believe it or not that would make finance hugely more complicated without reducing the risk...

    One thing that people consistently and stubbornly fail to understand is that we live in an inherently risky world, speaking in economics terms (but this is also true more broadly). What I am saying is this: the risk is not generated by the financial system, it is inherent. The financial system just tries to measure and predict the risk and to give it a price.

    It would take me too long to explain my point in more detailed and understandable way. I will try to do that in my blog and post a link.
    Jul 25, 2014. 03:51 PM | Likes Like |Link to Comment
  • 21st Century Fox Has Challenges [View article]
    Voting and non-voting shares in 21st Century Fox.
    Jul 23, 2014. 06:45 PM | Likes Like |Link to Comment
  • Bulgaria's Strange Bank Run [View article]
    People don't like risk. That's why they like to have demand deposits. Without demand deposits there will be a much bigger need for paper money that will be sitting in safes. Hence capital allocation will go down the drain.

    In other words, without fractional reserves the system will indeed be badly screwed up.
    Jul 23, 2014. 06:44 PM | Likes Like |Link to Comment
  • I Have No Fear Of A Market Crash Or A Significant Correction, Here's Why: Part 1 [View article]
    Yes, exactly, it's not all or nothing. And if you have $1 million you wish to invest in stocks, it is not like buy now for the entire amount.

    Sensible investing is diversified and happens incrementally.
    Jul 6, 2014. 04:33 AM | 2 Likes Like |Link to Comment
  • Bulgaria's Strange Bank Run [View article]

    You are missing entirely the point that fractional reserves allows banks to create a huge edifice of 'credit money'. If tomorrow depositors of local currency in Bulgaria asked the banking system to convert that money into euros or dollars peg will break.
    Jul 5, 2014. 10:55 AM | Likes Like |Link to Comment
  • Bulgaria's Strange Bank Run [View article]
    To say that the currency board is a disaster in the making is quite an exaggeration. The Bulgarian National Bank has around EUR 13.5 billion of FX reserves (including gold and SDRs) as compared to EUR 29 billion worth of demand deposits in the local currency held by the depository institutions. Under normal conditions this should be sufficient to backstop any external drain on the system.

    But the peg to the euro certainly creates some stress in the FX market.
    Jul 5, 2014. 10:46 AM | Likes Like |Link to Comment
  • Bulgaria's Strange Bank Run [View article]
    This debate about the property over 'money' is very misguided. One can only have property rights over physical currency printed on paper. All other 'money' is a balance sheet operation of the banks and signifies promises and credit.
    Jul 5, 2014. 10:24 AM | 1 Like Like |Link to Comment
  • Chicago Bridge And Iron - Speculative Buy [View article]
    Thanks, George.

    I agree CBI could have issued a more detailed reply.

    As for CBI's valuation, it has a current p/e 17 and a forward p/e 14. And still another 16% profit increase is expected in 2015. To me that makes CBI a buy at $70. Okay, perhaps not the most dreaming buy ever but it looks a reasonable thing to do.
    Jun 23, 2014. 04:09 PM | 1 Like Like |Link to Comment
  • Chicago Bridge And Iron - Speculative Buy [View article]
    You sure CB&I haven't commented on the report? What about this announcement?

    After all, even if true this too shall come to pass... Waiting until we have absolutely 100% proof that this is not a 'misleading' report means waiting till the share price soars, i.e. it will be too late and buying then will again be risky, from a valuation point of view.
    Jun 20, 2014. 09:06 AM | 1 Like Like |Link to Comment
  • Why Union Pacific Is Our Favorite Railroad Idea [View article]
    Thanks, good points there. But I don't think this is conclusive about the US rail because:

    - this accounts only for imports which I believe are a relatively small part of the freight of the US trains, and
    - it accounts only for that part of the import that does not care about the time.

    This excerpt also does not quantify the cost effectiveness of the Panama canal. If the savings are relatively small then it might not divert that much traffic.

    I would say - inconclusive - but a good issue to be explored.
    Jun 18, 2014. 03:00 PM | Likes Like |Link to Comment
  • Why Union Pacific Is Our Favorite Railroad Idea [View article]
    What's your take on that, Palladium?

    I don't see why rail should suffer from Panama. UNP, CSX and NSC connect industrial areas within the US. So in aggregate the Panama canal, even if it shifts some freight from one port to another, would not affect much US rail. If anything, the effect should be positive.
    Jun 16, 2014. 03:39 PM | Likes Like |Link to Comment