Mar

11

 One was asked for the market lessons learned from the current bachelor Juan Pablo who didn't find a girl to get engaged to after dating 30 of them, and didn't have a persona except to say, "you're so pretty" to all the girls. Apparently he misled the losing finalist, and she walked away from him. Susan said that he proved the palindrome's adage about never marrying a girl you wouldn't wish to divorce when she told him off and he said, "thank goodness I didn't pick her."

I am usually good about finding market relations. But all I can think of is the person who looks at 20 different signals and announcements, and each one twists him a different way, and he can't make up his mind to trade at all or to get out of his position. And then there's the derivatives specialist who lures you into a trade telling you that you can buy or sell it at a vol of 28-29, and doesn't mention that the bid asked spread is 200%. There's also the dishonest intermediary who quotes you an interest rate of 5% with great leverage to get your account, and then once you have your position on says they're going to have to raise the interest rate to 10%. (all of the above has happened to me, and more). But in general, he was a man without a foundation, he reminded me of the scarecrow in The Wizard of Oz, the person that enters the fray without a raison d'etre, bound to lose. Thank goodness the fine women on the show didn't end up hitched to such a person. What other lessons can we learn from that reprehensible personage who tricked the producers into giving him a ring and a vacation, with the idea that he was seeking to find a woman to fall in love with.

Tim Hesselsweet writes: 

 When you said "a person who looks at 20 different signals and announcements, and each one twists him a different way, and he can't make up his mind to trade at all or to get out of his position", it made me think that
a speculator needs a rudder but sometimes the uncertainty is the source of opportunity. The following quote from Seth Klarman's Margin of Safety illustrates the idea:

"Most investors strive fruitlessly for certainty and precision, yet…investors frequently benefit from making investment decisions with less than perfect knowledge and are well rewarded for bearing the risk of uncertainty."

anonymous writes: 

To most people, uncertainty is instinctively regarded as something bad. But it simply refers to an inadequate mental state, which in no way can be tied to things good or bad. At most, it may mean that there is a probability that something bad could happen. But with that, one should never forget that it also means that there is a probability that something good could happen.

Gary Rogan writes: 

 The last statement probably applies more to long-term investments than short-term speculations simply because over the long time uncertainties do get resolved. Besides simply not having the information available at all, searching for precision among mountains of data seems counterproductive for things that can easily lose 90%+ of their value or go up 10x.

Ken Drees replies: 

A few weeks prior to the finale (unfortunately the ladies around my house watch this show), I saw a headline in a tabloid at the market that Pablo was a no-good. So the tabloid had him pegged.

Juan Pablo, reminds me of the dog who had two bones. A dog with a bone in his mouth goes over a bridge and sees his reflection in the water. What's that? A small dog with a big bone is staring back up at him, so in greed he opens his mouth to attack or get the bone and then drops his real bone into the pond. Greedy greedy makes a hungry puppy. Maybe JP just kept looking for a bigger profit till he ran his account into the ground.


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