Greece is burning and Rome might follow, afterwards….
Greece is burning and Rome might follow, afterwards….
photo of Floor of Buenos Aires Stock Exchange by Barry Horowitz
Wall street is an evil place. There’s plenty of bloodsucking institutions that make money at the expense of average Joe. 9%+ unemployment ramps up while the companies are making record profits,. There are subprime being sold to customers, while being shorted at the same time. Greece cooked its books to get into the EU. Insider trading. Market manipulation. All sorts of croocked stuff. Then there are the Madoffs, Standfords and all that you can think about in between.
It is common to read on a daily basis about some new financial Armageddon, created by some very well respected (I should use the word “known” these days, instead) institution who ends up blowing some multimillion (sometimes Billion) fund that never existed. The list goes on and on.
Let’s face it: it’s all rotten out there.
However, my experience with the financial markets has been quite the opposite. Through these last few years, I have ventured into them on my own. This has translated into a raw and brutal learning experience counting endless hours of screen time, reading, experimenting, suffering, having moments of joy, and everything in the middle. Rinse and repeat.
During this journey I have met tremendous and very generous individuals –mostly, located thousands of miles away, and whom I have never personally met, yet. Nothing as further from the word “rotten”.
I’m grateful for having the chance to meet them. Each on their own way, have provided me with some of their knowledge, in straight fashion. No BS here.
They took time to explain me their techniques, ideas and experiences that have nurtured me and helped me in becoming better at trying to make “sense” of what I see every day in the markets.
Thank you to all of you. Again, I’m deeply grateful.
I always think, what would happen to the financial markets if more of the people I’ve met were represented within the spectrum?
This brings me to a very a quite an interesting experience. I hardly remember how it started, but the story goes more or less like this: As a frequent user of twitter, I have the chance to interact with an incredible universe of information and folks in 140-character space. 24/7.
I think it was around September of 2010, when I started to exchange mentions with @barry6214 on regards to the direction of the market. Barry6214’s uses market profile technique and auction market theory to trade, something I was exploring at the time (I’m still learning about MP & AMT).
A few more mentions went on until I decided to check barry6214’s profile and spot his avatar photo showed him with his wife in a very familiar setting to me: Casapueblo. Of course! I’ve been to that place a dozen times. It is located in Uruguay. It happened that barry6214 took this photo while vacationing with his wife, Pato, in South America.
Market randomness has started a friendship.
Is it really randomness? I try to connect the dots, and find out if the make any sort of sense when I blend them together. At some point, they usually do.
Our next step in the story (by the way, this all happened for real) is that barry6214 and I finally met a month later in Buenos Aires, where we had the chance to have long conversations about the markets and allowed me to see how he trades and looks at the markets, learn from his experience and strategies. barry6214 has been of great help in laying out the foundation of my study into market profile technique. Aside from being a great trader, barry6214 is an accomplished Ironman & triathlon competitor. You can find more about him at his website, Triathlon Trading Group.
While in Buenos Aires, we had the chance to have dinner together at one of my favorite places, Guido’s Bar. If you are ever here, make sure to go, it serves phenomenal Italian food. Old school.
December 2010. I’m going to Xmas party in Buenos Aires. There were quite a few people there: some locals, some foreign. Fun time. At some point I randomly run into an American fellow who was looking at the same girl I was – I later found out he got her phone number. His name was Jared. He was from NYC (as barry6214) vacationing down here. We exchanged names and contact details. I’ve learned afterwards he had a blast during his time in South America. Happy for him. Never found out what happened to the girl 😉
Fast forward. January 2011. NYC. I had the chance to be there and met with barry6214 again. We arranged to have dinner, where I was also going to meet the rest of the family, including his son.
To make a long story short: I get to the place, see Barry and his family and time freezes for a second when I recognize the face: the guy that I’ve randomly met back a month ago at the Xmas party (I did not know that Jared was related to Barry, back then) was in fact, barry6214 son!!!
Life is a trip. Indeed.
By the way, today is barry6214’s Birthday. Happy Birthday, my friend.
As a lawyer – although, I rather like to describe myself as someone who attended to law school since I generally do not relate with lawyers and I practice seldomly nowadays- you learn to work with language.
Succinctly, you deal with three characteristics that language has:
1-) Vagueness – which relates to the lack of precision that certain word bears
2-) Ambiguity – relates to the multiple uses the same word can have
3-) Emotional bias – quite a few words have an implicit connotation to the receptor of the message. For example: “murder”, which generally evokes a negative feeling or reaction in the receptor of the message. In terms of trading, for example, Stop-loss or Take-profit, have two very different meanings because of how we realate to them and what the trigger into our past experiences.
Furthermore, depending on which variation of Spanish you use, you might find quite opposite meanings. That is the case for “curro”.
In its slang meaning, it is used by Spaniards to define “work”, or “job”, while Argentineans use it to define “robbery” 🙂
As the Argentine slang dictionary defines it: curro is a scam, a fraud, a deception; a dirty business, an illegal arrangement. The corresponding verb is currar [vt]. Note that this word means ‘work, job’ (no negative connotations) in Spain.
Seems that the description of curro fits the case for George Packer’s chronicle of Raj Rajaratam/Galleon’s Fund insider trading case in the current issue of The New Yorker magazine. I’ve been interested in this case since I’ve first read about it. However, it was difficult for me to be able to keep up with it on a daily basis. The article portraits the whole set of events in an organized manner, plus and its various ramifications.
This has left me wondering why go to the movies, if what happens in real life tends to outstrip it.
Better read with suspense music and good drink.
I’ve been re-reading my last few posts and find myself expressing “less” in my writing than what I would like to.
I’m not happy with “Euro & Libya…” post, but I guess I”l leave it like that in order to be able to review my progress
I have quite a few ideas that I would to share and I hope it will evolve as it becomes more of a habit to me. My idea for would not be to be “finance-centric” but, to be able to share my interests, quests and ideas.
A work in progress.
It is used to help glass and ceramics to become heat resistant, it is also used in psychiatric medication in order to assist treating depression. But most importantly, it is the primary resource used in manufacturing of batteries that power almost every single device that we currently use, such as cellphones, computers and -in ever increasing markets- cars.
Just bumped into Sonic Editions’ online shop, which portraits some of the most iconic characters from our time.
Haven´t had much focus on sitting and writing, lately. I guess, I´ll work it out and let develop the blog in its own form. There´s is so much interesting information around, that I figured I would end up the day writing, which is not the idea, at least for now.
One of the most interesting things I see during the day, is how the market “reacts” to certain news or events. Another issue that always gets my attention -at least in the short-term- is how “disconnected” the market is from what is generally taught in a basic Macroeconomics course.
For example, last week, the Euro/USD fell from 15-month-high @ 1.4695 to 1.4300 in 2 days, only to recover and touch the 1.4430 mark, today. The “curious” thing about it, is that the event that “triggered” the sellof last week, was the reaction to the JC Trichet hawkish stance on a posible hike of interest rates … As far as I know, money chase yields is one of the basic concepts in econommic theory. Point to be made, this seemed like a typical type of “buy the rumor, sell the news” situation, in which the move has already been made, and the event in fact only works to “trigger” the opposite response of what the rationale would suggest.
But the story doesn´t ends there. Today, S&P downgraded Greece´s credit rating on the basis that any attempt to rollover its debt would be considered a default…Making it, according to a Reuters report, the lowest rated country in S&P’s universe … Although I´m sure this is not an easy situation, I guess there are many more countries around the world who are in worst circumnstances than Greece.
The answer to that: The Euro rallied back towards the 1.4430 mark… The rationale? There is nothing “rational” about buying the currency of an country, area that is going to the tube, even might be the “Next Lehman Brothers”, according to an article published by the NYT this weekend. This also brings the issue of moral hazard into the equation and the possible consenquences of another global meltdown, which will bring me to more hours of writing, which I currently don´t have. Thus, I have to conclude that I have no idea on why the Euro made that move, and have no intentions to get into intrincate discussions… It is just “is”
This brings me to Euro-PIIGS-default-whateveryou-wanna-name-it situation that has been going on for almost 1.5 years (the Euro crises reached its “peak” back in early June of 2010. Personally, I don´t think there were too many individuals (included myself) that -back then- would have a gavored stance towards the euro appreciation in the year to come… The answer is that you never know.. no futurology, just probabilities.
I have to say that -at least back in early 2010, when the crisis unfolded- the comparison to Argentina´s economic crisis back in 2001-2002 seemed like an interesting analogy to lean into, although I´m not so sure there´s is such, with the exception of the common ground: when you spend more that what you make, your probabilities of going broke tend to increase, specially in the long term.
The other story that I´ve been closely following, is Goldman Sach´s management of a Libya´s Sovereign Wealth Fund investment that netted $1.3B loss back in early 2008, which unfolded into a spy-like novel, including the possibility of Lybia to become a Goldman´s shareholder.Hard to imagine that in the current state of affairs.
Furthermore, according to the following article, Back in Nov. 2009, Greece -with the “assitance” of Goldman, in this particular case- was presented with the possibility of rolling over the debt of Greece´s health care system into the future, similar to what many homeowners have done from 2002-2008 in the US.
As a clever piece, depicitng the (in)famous financial behemoth by Matt Taibbi in Rolling Stone magazine, back in April 2010: The first thing you need to know about Goldman Sachs is that it is everywhere…
It never ceases to amaze me, how interconnected the players and the events are.
Have good night.
Update; Bloomberg has a published a report that the Libyan Investment authority has decided to trim off its investments in lossing Hedge Funds. The article also points out that the US, UK and Europe have frozen Libya´s assests, although it fails to explain how come Millenium, a London-based HF continues to manage some of Lybia´s assets.