CS3

It has come to a time where I have decided to close this blog. It has been close to a year since I started writing "the new boy plunger". I hope that you have benefited in one way or another through some of my articles. I will still continue to trade and start on another trading endeavor. Hopefully, I can come back better and write more meaningful articles.

Therefore, this post shall mark the end of my student trader life. I guess it is really nice to end off achieving my dream of presenting in front of a huge crowd. Really thank you all who have been supporting this blog. =) Ciao...

Investment Talk at NTU

Hi everyone, I will be speaking in this investment talk held in my school, Nanyang Technological University. My presentation will be mainly on my investment philosophy. The details of the talk are as follows:

Date: 18 February 2010
Time: 1830 hrs
Venue: Lee Kong Chian Lecture Theatre, Nanyang Technological University
50 Nanyang Avenue (S) 639798

I will like to invite readers of this blog and will want to meet you in person. This is probably the one and only time where I will be giving a proper presentation and I'm really fortunate that my club has given me this chance.

Regards
Jin

iPad 2.0

I think there is enough negativity written about the iPad or the "iTampon". I will not go down the line with this post, rather, I shall highlight some idea that iPad 2.0 should work around. These ideas were raised by the team running this blog, especially our IT manager, KX.

Ground Zero Approach Part II

To some extent, Ground Zero is really about simple economics. I guess this is why freakonomics becomes famous as it revamps the way economics is being used. Coincidentally, all the writers of this blog are fond readers of freakonomics. I once discussed this approach with a fellow member of my investment club and she found it hard to follow my logic. It might also be possible that some of you might find it difficult as well. Let me use Ford as an example.

Ground Zero Approach

All this while I have been trying to consolidate a strong concept for people to latch on and apply. I want to teach. Clearly, I disagree with people are doing with FA and TA. But my style of analysis is a bit fuzzy and airy too as it tends towards something like behavioral finance. Kenny introduces the phrase "Ground Zero Approach" and I buy that. It is probably because ground zero thinks from a really weird way and seek to understand the underlying main concern or relationship.

Jin - Quick Update

My apologies that we were caught up with the exams lately and couldn’t find a chance to speak to each other or to update the blog. So, we decided to have a quick update on how some of our calls have been performing.

Interestingly, Kenny aka Mr X was spot on right before some market catalyst and his calls on ford and microsoft were outstanding. The red arrows on the graph above show the time period where he made the calls. I really wonder if he has some insider information. The idea of a bigger share of a smaller pie in the autos industry was great. The ground zero approach for microsoft revealed the strength of microsoft.

From the chart, both of the stocks outperform S&P500. Furthermore, both paulson and george soros were seen adding microsoft and ford respectively into their portfolio according to SEC fillings. It was amazing!

Dubai has been the issue of late but I don’t really think that it brings about any serious implication as of now. It maybe that the implications will only be seen in 2010, I don’t know. To me, as long as dollar keeps going down and there is a commodity rallying (gold), stock market will continue to climb.

All three of us will be meeting in singapore in mid december and we should have more fruitful discussions then. Thank you.

Jin - Market Sentiment

As a committee member of my school’s investment club, more often than not, I have to attend to investment talks by professionals. These talks range from real basics of the stock market to more in depth stock analysis. Frankly, such talks are rather dull. However, they have something in common, especially talks about fundamental and technical analysis. In the later part of their presentation, they will always conclude by highlighting that the most important thing about the stock market is the market sentiment.

Kenny - Microsoft

3 weeks have passed since I've posted and I'm glad to be writing again. October 22nd is just around the corner and that means Windows 7 is going to be available to the general public real soon. I'm pretty excited about this as well as the prospects of Microsoft. This post, similar to my previous one, will be somewhat anecdotal/common sensical. I did receive a bit of feedback about how my posts don't have raw numbers for facts but personally, I prefer to invest in my own common sense. Again, I'll talk a bit about investing philosophy and then focus on the reasons why I like Microsoft.

Ashpal - Alternative Investments

To lay the foundation for my explorations and eminent advocacy of alternative investments, I would firstly like to address the situation of the US dollar. In my opinion, and as expressed by numerous people in a host of positions, we should see a decline in the US dollar. The questions to be addressed will be why and over what time scale will this occur.

Goldman Sachs - The True Banking Culture

Goldman Sachs – Strong Fundamentals Continue Business Tenet

Goldman Sachs used to downplay or avoid consumer-oriented retail businesses like stock brokerage, credit cards and mutual funds. There are three main activities that it engages in – Investment banking (chasing M&A deals), trading and principal investments (market making and proprietary positions) and a segment it once avoided, asset management (offers investment products).

Greetings: Jin

Greetings to all the readers out there, I’m Jin, the former sole writer for “thenewboyplunger.blogspot.com”. Just a formal introduction of myself, I’m a Nanyang Technological University undergraduate majoring in Accountancy and Banking and Finance. I’m also the vice president for research and education in my school’s Investment Interactive Club (IIC). More can be read under my profile at the contributors column.

Mr. X - Ford

I like Ford. Or more specifically, I like the long term prospects of Ford. Cash for clunkers has been a huge plus for them in the past few months but it really doesn't mean anything in terms of the big picture. FYI, cash for clunkers is a program where people trade in their old gas guzzling machines for up to $4000 for a new environmentally friendly vehicle. It was a program put together by the US government to help the US auto industry and to reduce emissions.

Greetings: Mr. X

Since this is the first entry of the group blog, I’ll do some introductions here (you can look under the profile section if anyone wants to stalk us further). Followers of the previously solo-blog might even know me as Mr X. A bit about myself, I’m a Northwestern University undergraduate majoring in Electrical Engineering, Economics and possibly, Computer Engineering. I will be participating in the Kellogg Certificate Program for Undergraduates for Financial Economics, which supposedly is a highly selective program, in the next academic year.

Restructuring

Greetings to all, thenewboyplunger.blogspot.com is currently going through some restructuring. A new team consisting of students from Northwestern University, Cornell University and Nanyang Technological University will be formed to run the blog instead of just a writer previously. This is an attempt to bring in diverse perspectives on various investment related issues. So, do stay with this blog and keep a look out for the new change as well as more insightful and professional posts.

We hope to see you all soon. =)

I Will Be Back 2

I will be back after my college exams in 1 week's time. Really sorry about this.

Thanks Thanks

Jin

Why I'm Buying Gold at $1000

To sum up everything into one line, "The Time is here."

This will be the first time I'm buying a future contract. I am going to all-in gold with all the profits I made through shorting the HSI last july. Readers of my blog will know that I do not believe in diversification. It is crap in my opinion. As I always emphasize, put all your eggs into one basket and watch your basket.

De-coupling from Oil, Dollar....

Strangely enough, gold has somewhat decoupled from everything. Other than the fact that when the market is down, gold price rises, it simply ignores the movement in oil and US dollar. I feel that this is a sign - a sign of gold bull market. It is a sign of all bull markets. Ignore everything and sky rocket. It will of cos end in a bubble like manner but before it ends, there is so much money to be made.

But... Is it a bubble forming?

Some may argue that this is a bubble forming. As always, I face lots of funny opposition when I give some crazy thoughts about the market. But it is only at 7-8mth high.

Lets reflect on some bubbles we see before.

1. China Market - more than 100% for two yrs. PE at 90. Bubble? Yes

2. Dot Com - similar to china market

3. Housing bubble - subprime

4. Possible bond bubble - lowest yields last seen 40 yrs back.

You make the call. =)

Gold At $1000

Magic number 1000. We have seen that happening for oil before. Gold has to close above $1000. The close on friday was not at $1000. But believe me, it will be there soon. Real soon. It may even be next week for all we know.

Conclusion: I have talked about the reasons about gold before. I believe that you should be opened to many assets as well. I'm buying gold at $1000, are you?

Polar Bear

I feel that this is not a bear market.

This is a polar bear market!!!

Polar bears are carnivorous unlike a normal bears which are omnivorous. Polar bears are also the largest land predators. I find this pretty funny. What I'm trying to do here is to emphasize that this is not a normal bear market. It is a polar bear market where your environment is going to be like winter, where the polar bear will be hunting for you. Apparently, all the seals are gone now. LOL to put it in financial terms, it will be one of the worst bear market that really destroys bulk of the wealth in the world.

Again, I see no value in stocks. The economy is horrible. There is a reason why the top 5 hedge fund managers shorted the whole fiasco that we are facing. They understand the economy and there is a reason why Warren Buffett is buying into Swiss francs. Come on, I have emphasized this over and over again. Buffett years will take a very long time to come.

But jokes aside, I was looking at some stuffs and remembering how the market was going. I feel that it is very bad. Descending triangle at a very deadly level of 8000 is not a very good omen in my opinion. All the rallies have been killed lately and we should all know why.

The lost decade for the world. Sounds apt for current situation? Welcome to the new polar bear market.

Forest Fire

What should the smart people do regarding the financial system?

This is a burning question that everyone has in their minds. Is bailout good? Jim Rogers and Austrians alike will say no. I will throw you the word unknowledge. Majority of the people (I guess) will say that if we don't bail them out, we will suffer badly (whatever).

So I was talking to this teacher today and I explained to him about my forest fire analogy. He was mentioning to me that actually people do try to stop forest fires. They will burn down a ring of trees that is further away from the main fire. This isolate the inner burning trees and also prevent them from spreading to the good trees outside. Perfect sense!

I thought that this was pretty awesome. Two things that we can draw here.

1. Identify the end of the bulk of dry leaves.

2. Burn them first.

But by doing this, you need to hit yourself at the back of your head and say: you can't stop the fire that is burning now. This has always been my line of thought. But I guess it is easy to say but difficult to believe in.

Identifying the end of the whole bulk mess is also another difficult task. I mean, what are the good banks/financial institutions left? I really don't know. Hopefully someone can enlighten me. Maybe Lazard Frères & Co will rise to the top of the industry again.

Burning down a ring of weaker trees is also another tricky question. How to burn banks? I suppose you have to let some go bankrupt.

But ultimately, to fight against a super huge fire, you have to use fire. I know this sounds freaking fuzzy, but it's pretty cool isn't it? Common sense tells you to use water but during a super huge fire, where do you find the huge supply of water?

Desperate times call for desperate measures. Use fire against fire. I like it.

Mysterious Gold

I really like this bunch of people. Do check out here to know about them. I will provide a short write up about them though.



Basically, there is this group of people who went into research on gold deposits all over the world. They ask lots of questions about gold to authorities but are constantly rejected all the time with fuzzy answers.

So the story of the mysterious gold goes like this.

1. Central banks are holding lots of gold.

2. You don't earn money holding gold. So you loan them out.

3. You loan at 1% interest to banks called bullion banks.

4. They borrow these gold and sell them to get cash and buy bonds that gives them 5% interest rates against their 1% loan payable (accounting!!)

5. Yup, these gold are what we wear on the street.

6. But they have to manage their risk properly against gold price so they have to hedge by buying some gold futures.

7. Well, step no.6 is an ideal scenario. Humans being humans, like to try funny stuffs. We see them all the time.

8. Basically, there are many more reasons. But I only find one that is particularly interesting. The authorities are not very transparent about gold lending activities. They don't reveal the figures.

9. From this, there is a possible double counting error. Banks will count that they are still owning the gold. The market people will count the amount of gold they have when in actual fact, these gold are the mysterious gold that are supposed to stay in the vaults. Get what I mean?

10. However, so what if this is true? It could be my next life time because the truth is out. This is very important. It is exactly this situation that make me think for quite some time and I think I can see the picture now. My inspiration comes from Bank of England. Sterling pound is dead. But does that mean that US dollar will be good? If not, then what will be good?

I think the world currencies will be in a mess. No one will like any currency in my honest opinion. Everyone will look back at gold and this is when the shortage will be realised by the whole world because demand is going to drive the truth out and it will be an upward spiral.

Hope this doesn't sound like any self fulfilling prophecies. I just feel that such stuffs make sense to me.

Oil 101

I didn't have much time to write a lengthy one. But I think talking about oil is pretty important today. I remember my friend asking me to buy oil right now because he thinks that oil is cheap. I feel that there is a lot more into what's going on in the market and the oil story is pretty complicated.

My logic for oil is pretty simple. I always advocate on understanding the general environment (environmental analysis... whatever).

In my opinion, if no one likes oil, oil will not go up. No matter what's the fundamentals are like now. Of course, in the long run, people will begin to realise its fundamentals that's why most people like to buy and hold as long as they get the big picture right. In addition, people are ignoring the supply side in my opinion. Oil looks freaking cheap (not to me though)!!! But let's not anchored our mind on $140 a year ago. There are few things to look out for.

1. A good huge selling of oil. It will be great if oil hits $20.

2. The next time it crosses $50, it is time to buy oil. I have no doubt for this. Just that it might take some time before it crosses $50.

3. To some extent, I feel that Treasury bubble has to burst first before oil will come into play. Of course, don't forget that I'm a very faithful gold bug.

Speaking of gold, I shall talk about gold lending activites during mid week post.