The oak door to the office remains open a sliver, creating a void of sullen darkness for the light from the fire to be lost in. The flickering blotches of vision creep softly across the plaster walls, revealing brief glimpses of the patterns painted on them. The chilled air is causing goose bumps to form on my skin, as the hearth combats the night air and my body’s heat is slow to reach the stained finish and fabric of my chair. The only steady light in this room is that of my computer screen; a strange juxtaposition of modern technology against the classical décor of my preference.

And the 9th floor is open once again.

I set out last week, with Madame de Thaler, for our trip to the Caribbean seas. We aimed to meet up with her friends, as one of them was to be married on the island of Jamaica.

The ceremony itself was beautiful, set on the side of a mountain next to a waterfall that cascaded around us in lifting rhythms and soft music. Yet, amongst these guests and the ninety degree weather I insisted to attend the ceremony sporting a charcoal three piece suit.

It was a reunion tour for the island, and I brought colonialism back.

The island itself was dirt poor, and I am glad I refused to walk around much. If I wanted to have beggars pester me for change or try to sell me low brow merchandise, I could have visited Flint.

Let’s just say, if Bob Marley should ever lose popularity, I am afraid that the Jamaican economy shall spiral into an unrecoverable depression.

The nation most definitely needs to get beyond merely providing the random whims of tourists, and actually begin to provide for its people, with modern day infrastructure and appeasing the demands of its own citizens. It was sorrowful, seeing a place whose only wealth comes from the outside.

As for the trip in its entirety, we remained on the water for four nights long, entering various ports of call as I entertained my beloved’s desires of dancing, spirits and merriment. But, sadly, we had no access to internet (a surprise to myself), and so I was without means of contacting the greater world.

Still, in hindsight, it seems I was quite dead on, raising a cash position as the markets pulled back for much of last week. I spent all of Saturday catching up with all the relevant world developments in the most efficient means possible.

Remember friends, the iBankCoin news app isn’t just the news. It’s the news told by people who matter.

Now, enough lassitude for me. It is time to return to work.

Comments »

This is the part of the craft which is most trying. The great strides of time that seem to channel behavior both sluggish within their barriers, as well as profligate in hindsight. The long hours of anticipation. The hunters’ momentary lethargy.

On the one hand, I am human. And as such, I despise waiting. But on the other, I can transcend my earthly disposition, and value the beauty of a lingering hour. If only all hours lingered like these now, then I might live forever in them.

On the one hand, we are continuing upward in small, consistent steps. However, the world is anything but consistency. Real change and innovation comes about in sporadic, wild strides that change the face of the world in days, hours, or even minutes.

Steady doldrums of progress are a myth.

Europe continues to melt down, and while this comes as no surprise to us who observe these things on a regular basis, the real question becomes, has the pricing in of further bailouts and failures of the Old World already been factored in.

And what of the continued crisis of Japan? What if America’s promises start to haunt her streets? And who will stand up to guarantee certainty then, in this uncertain land of ours?

These are all questions which remain to be answered. As we wait, we can only wonder, when?

Comments »

Look, forgive my obstinacy, but despite having devolved to a cash position yesterday by way of selling out of MGM, NRP, and TLP, I did so purely because of appreciation on what a Japan meltdown could do to other traders and investors. I am obligated to hold some cash, with the possibility of unattended bond auctions creating ramping yield environments, so that I might buy said auctions. I am obligated to sell a company like MGM when questions about global trade are put on the plate. And, yes, I am obligated to take profits from a very successful two years of strategy, when it looks like the dollar is suddenly, miraculously undervalued (by no means of its own, of course).

However, despite taking a few steps back, I still like all the positions in my portfolio. Even the ones I sold. Cash, at this point, is an insurance policy, not a policy unto itself. I might refrain from repurchasing TLP or NRP, but MGM is still in the deck, provided this blows over.

On to a more pressing issue, let me remind you in the audience that you are not nuclear physicists. I’m hearing some pretty outlandish claims here, which I can easily spot as being false. For instance: Chernobyl.

Chernobyl is perhaps the most over hyped event to have occurred in human history. When it transpired, no prediction of human casualties was high enough to accurately assess the situation. Whether it was hundreds of thousands or hundreds of millions, the number of deaths resulting from the incident was to be unparalleled.

As of 2005, a staggering 56 people had died as a consequence of Chernobyl, and meanwhile, cases of cancer attributed to the accident (from which there is a 99 percent survival chance) are both:
• Below original estimates, and;
• Unreliable, since before the accident, records of cancer in populations are sketchily kept, at best.

There was a fairly excellent collection of essays by Dr. Michael Crichton on the issue, as I recall, but upon checking his legacy site, I find that they have been removed in ominous fashion. So instead, I’ll just link to this article from the Times in 2005.

You see, I know most of you are full of shit. You cannot tell me the difference between an alpha emitter, a beta emitter, or a gamma emitter. You have no idea what a nuclear plant uses, and hence no idea what is being thrown into the air. And depending on what that material is, the consequences of coming into contact with it vary. In some cases, you could swallow the fucking stuff, and it would cause you less harm than if it were a short distance away from you.

If that last statement makes no sense to you…that’s exactly my point. Calm the fuck down. You people talk about nuclear energy like a 14th century clergyman talks about witchcraft.

Nuclear energy will still have a place in the future, and if the Greenpeace lot skip around much harder, I’ll be putting cash next to mouth, in force.

And good day to you, sirs.

Comments »

I am experiencing a bloodletting today, with my portfolio down 3.6% thus far. Thank you oh so much, TLP and NRP, for crimping me at the neck. I do not appreciate it; oh no, not one bit.

Why this is happening, I cannot say, unless it is simply the market succumbing to selling pressure and leading us lower. Coal and transportation have had a terrific year, so this could just be money rotating out. It could also be people getting ready for skyrocketing oil prices to crush domestic demand.

Pray it isn’t the latter.

In order to hedge a little further, I shorted KOL, the coal ETF, for $45.75 average cost. This should directly relax my position in NRP. NRP collects coal royalties, the determining factor of which I am now betting against.

I’m not a fan of the market right now. Too much shit going on. I’m glad I sold out of as much stuff as I did. This would have been nasty if it happened a few months ago.

Comments »

Speaking on Friday March 4, Janet Yellen of the Federal Reserve Open Market Committee offered words on the state of global monetary policy which, as of yet, I have been unable to decipher for any trace of discernable thought.

Throughout the decent length speech, she touched on many subjects, including the abolishment of the Bretton Woods system, the trade imbalance with China, and Keynesian rationale for deficit spending. However, reading through it, one would be forgiven if they didn’t pick up on any of this.

The one thing this Federal Reserve member seems most keen on is keeping things the same.
On the nature of deficit spending and gross liabilities in the U.S. leading into the housing crisis, Mrs. Yellen seems to feel that the fault rests with the trade imbalances between foreign partners.

“Strong capital outflows from countries with chronic current account surpluses–in part reflecting heavily managed exchange rates, reserve accumulation, and other shortcomings in the operation of the international monetary system–put downward pressure on real interest rates, in turn boosting asset prices (particularly for housing) and enhancing the availability of credit.”

Such an argument is new to my ears. While certainly it is true that large differentials in trade, coupled with reinvestment on the part of the surplus running country into that of the deficit running country, could create and foster a cheap money environment which could lead to wild asset bubbles – well, couldn’t the same thing be said about all forms of debt?

Lenders by their nature cause real interest rates to be lowered. To suggest that such a cause is merely on the hands of trade imbalances, while certainly nestled around a grain of truth, seems to miss the larger issue.

Janet Yellen continues, despite overlooking this obvious fact, by – almost psychologically – going on the defensive of debt and deficits as a whole.

“These developments contributed significantly to the buildup of financial imbalances, but they were not, on their own, sufficient to have engendered the massive financial crisis we experienced.
Had the additional domestic credit associated with these capital inflows been used effectively, the imbalances need not have led to financial ruin.”

Well yes, that would be the ideal setting, wouldn’t it? Where all faith and trust are met to the fullest of expectations and more; however, it is worth noting that to count on fulfillment of promises as a matter of policy is somewhat naïve.

What should be apparent to everyone, after almost a century of continuous disappointment by Keynesian economists, is that the fractional reserve banking system is not a blessing or a boon to those who reside beneath it.

This implies one party with ownership to one asset and well defined obligations of any counterparties. Not a continuation of the same system over a larger and more continuous jurisdiction (same problems, but now they affect more people).

The only aspect of Mrs. Yeller’s speech that she seemed to nail was the general suggestion that things have to change. However, in referring to China in hushed tones as “countries with chronic current account surpluses,” ambiguous terminology like “flexible exchange rates” (a buzzword never explained in terms of real transactions), and half-hearted calls that we somehow make everyone to be sensible and follow the rules, you may be left wondering just when all this change will be occurring.

Comments »

Home mortgage applications rose to the highest level in three months last week, reported Reuters.

The Mortgage Bankers Association says its seasonally adjusted index of mortgage application activity, a combination of refinancing and home purchase demand, rose 15.5 percent in the week ending March 4.

The MBA’s vice president of research and economics, Mr. Michael Fratantoni, feels this is a product of an economic uptick.

“An improving job market is beginning to pave the way for an improving housing market,” Fratantoni said.

However, certain questions remain. Exactly how much of this progress was from simple refinancing opportunities versus actual purchasing of housing units remains unaddressed. Meanwhile, homeownership rates remain well above the mean historical level, while high numbers of distressed homeowners continue.

That and a 15.5% increase during a period of exceptionally low levels of home sales isn’t necessarily an indication of recovery.

Comments »