4/27/13

Observations

“Yes, they look happy because of their wealth. You do not know, however, what is on their mind,” SNS told me with gravity one day. There is no doubt it is all about our mind, however you want to define it. I believe it is our thinking process with all the biases we bring along as we mature. The trick is to remove the biases and keep our mind free to roam.

For many years, every day, I have been practicing qigong’s (pronounced: shee-gong) slow and fluid movements (even slower than tai-chi) -- 20 minutes in the evening before going to bed and 55 minutes in the morning including stretching exercises. Following the closing of the markets I jog for at least 50 minutes. These drills make me achieve the mental balance I need to face every day the whims of the markets and the responsibilities of money management.

In the evening I try to use movements and mind interaction to achieve peace and harmony. It is very difficult, but you know when you get it. There is an enormous serenity and calm in and around you. Your body loses its physical features as it tries to absorb your mind. As I breathe slowly with my stomach moving my hands or my arms, I let myself go places difficult to describe. I feel in animated suspension.

My mind explores all the parts of my body until I do not feel my body anymore. It lasts a few seconds, but it is really worth trying. The Taoists say this is the time when you find Tao (however you define it). In the morning I do the same exercises, but I add more physical routines. One of them is to place the tip of your toes against the wall and slowly bend your legs to touch the knees with your hands. Then, slowly go up. I do it 20 times. At the end you feel light and ready to jump.

The objective of qigong is to relax and rebalance your mental and energy levels. The Taoist philosophers and qigong practitioners maintain that achieving this mind-body balance in harmony with anything around you is the necessary step to preserving healthy physical conditions.

(This Observations appeared in the 6-12-2006 issue of The Peter Dag Portfolio ).

George Dagnino, PhD Editor,
The Peter Dag Portfolio.
Since 1977
2009 Market Timer of the Year by Timer Digest
Portfolio manager

Disclaimer.The content on this site is provided as general information only and should not be taken as investment advice nor is it a recommendation to buy or sell any financial instrument. Actions you undertake as a consequence of any analysis, opinion or advertisement on this site are your sole responsibility.

STRATEGIC INVESTING FOR UNCERTAIN TIMES.
Learn how to manage your portfolio risk and sleep comfortably. Improve the certainty of returns by taking advantage of business cycle trends. Learn to use simple hedging strategies to minimize the volatility of your portfolio and protect it from downside losses.
You will receive your user id to access 4 FREE issues – and all the previous ones - of The Peter Dag Portfolio. Email your request to info@peterdag.com. New subscribers, please.

4/21/13

LONG-TERM ECONOMIC AND INVESTMENT TRENDS: ASSESSING CHANGES IN THE LONG TERM INVESTMENT TRENDS

Since 1950, the dramatic developments of the U.S. economy and financial markets can be explained in terms of what happened to the level of real interest rates. Of course, there have been many other factors at play. There have been wars, changes in government policies from smaller governments to bigger governments, and an increase in the welfare state and many, many other reasons. Quite often it is easy to be misled by headlines sponsoring specific ideas and specific political trends. Sometimes it seems appropriate to have a government leading more towards a welfare state where the government is the caretaker of the problems of the citizens, from insurance, medical assistance to daycare and so on. But all these trends have a price and the politicians, or for that matter no one, knows when to stop. The only time people recognize that they have to stop is when the problem has been created and is so big that it has to be solved.

The typical example is what happened in the 1970s in the United States. The trend of the 1970s was to provide more assistance to the citizens and the government tried to satisfy those needs. At the same time, the United States was also involved in a war. It was difficult for the average person to recognize what was happening, and difficult for the average citizen to evaluate the impact of certain decisions when the commitment was not to raise taxes - although there was a commitment to fighting a war and implementing what used to be called the Great Society. Inflation was the only solution. But the average investor needs to have an impartial framework to assess and develop an investment strategy.

The investor needs a precise number and something to follow to make decisions. The only number that can accurately depict what has happened in this century is the level of real short-term interest rates, which has been mainly driven by the policy of the Federal Reserve. Clearly in the transition from the 1960s to the 1970s the average investors would have realized that something was happening when gradual inflation kept rising and real interest rates started to decline. As inflation began its decade long rise, the dollar slowly and steadily began to weaken.

Because of the very close relationship between real short-term interest rates and long-term interest rates, the analysis will be based on real short-term interest rates. In the 1970s when real short-term interest rates declined sharply below 1.4, it was a clear signal for the investor that the seeds for an inflationary environment were planted. As we said above, inflation in this century has been stable when real short-term interest rates were kept close to 1.4 or above this level. The only time inflation rose sharply is because real short-term interest rates declined below 1.4. The impact of real long-term interest rates will be discussed in the chapter dealing with investments in bonds. It will provide valuable information on how to determine when bonds become a good investment.

Dr. Henry Wallich, a governor of the Federal Open Market Committee in the 1970s, often noted that real short-term interest rates were too low in the 1970s, even at a time when short-term interest rates soared from 3% in the late 1960s to 20% in 1982. His point was money was too cheap and it would be inflationary for the reasons discussed in the previous section. Of course, the Fed could not raise real short-term interest rates because cheap money was necessary to finance the "Great Society" and the war in Vietnam since the government did not increase taxes to finance both efforts.

In order to fight inflation the Fed let interest rates rise in 1968, causing the recession of 1969-1970. Inflation declined because of very slow growth in the economy, but money was still kept cheap, as real interest rates were kept low.

The next expansion, which started toward the end of 1970, saw inflation rising from 4% to 6% from 1972 to 1974. Worried that rising inflation might go out of control, the Fed let interest rates rise again in 1972, causing the recession of 1973. Again, inflation declined from 6% to 4% because of slow economic growth. However, because of very low real short-term interest rates, the next expansion was accompanied by even higher inflation, which soared to 15% in 1982.

The lesson of the 1970s was that low real short-term interest rates were accompanied by soaring inflation and a very volatile economy because the Fed had to induce a recession every two years to try to keep inflation under control (Fig. 5-1). Commodities soared with the price of gold rising from $35 to $800 and crude oil from $25 to $40. Wages jumped because of rising inflation, and also due to lower productivity. As a result, unit labor costs (the difference between wages and productivity) rose rapidly. Not surprisingly, corporate profitability was dismal. The dollar, which reflected soaring inflation and poor economic conditions, collapsed from 3.20 German Marks to the dollar to only 1.50 German Marks to the dollar. The Yen also soared relative to the dollar from 340 Yen to the dollar to just about 85 Yen to the dollar.

While returns from hard assets were simply fantastic as prices of commodities, such as gold, crude oil, industrial metals, real estate, and just about anything soared, the returns from investments in financial assets in the 1970s were dismal. Bond prices collapsed as yield on 10-year Treasury Bonds soared from 5% to 15%, and the stock market finished in 1982 at the same level as it was in 1968, mirroring the dismal performance of the profitability of corporations.

Clearly, the 1970s were a very special decade and provided important lessons. The 1970s experienced extreme business fluctuations as inflation rose from 3% to 15%. Business cycles were much more stable in the 1960s and after 1982 as inflation declined back to 1960 levels.

The 1970s were characterized in the following terms:
• Low real short-term interest rates below 1.4%.
• Rising inflation.
• Rising commodities.
• High volatile economic cycles.
• Dismal productivity growth.
• Corporations could raise prices because of rising inflation to improve profitability.
• Low investment in technology.
• Soaring real estate and land prices.
• Soaring long-term interest rates.
• Sagging bond prices.
• Frequent protracted declines in stocks with prices going nowhere from 1968 to 1982, or 15 years.

The dollar also sagged, reflecting a US economy in total disarray. In the 1970s, the decline in the dollar made foreign investments particularly attractive, thanks mostly to the strength of European and Japanese currencies.

If the investor looks at the years 1955 to 1968 and the years following 1982, the most crucial feature is that real short-term interest rates in this period were kept well above 1.4. In the years following 1982, they were considerably above their long-term average. By making money expensive in real terms, the Fed forced consumers and business to become wiser in their spending and their investments (Fig. 5-2). As inflation declined, business could not raise prices at will. In order to improve profitability, they had to enhance productivity (Fig. 5-3).

Inflation soared in the 1970s as real short-term interest rates were kept below their historical average. Inflation was low in the 1960s and after 1982 as real interest rates were kept above their historical average.

Due to declining and low inflation after 1982, business lacked pricing power to improve margins. Consequently, corporations relied on enhancing productivity as a way of absorbing costs and raising profitability. As a result, since 1982, the U.S. enjoyed soaring productivity growth.

This could be done by restructuring and with heavy investment in technology. It is no coincident technological development boomed after 1982 and was stagnant in the inflationary 1970s. Technology stocks also soared as new technologies were introduced. The lesson is that as long as real interest rates stay high, and inflation low, technology stocks will continue to perform well. As productivity soared, unit labor costs remained stable, even if wages were growing at a 3% or 4% pace. At the same time, inflation and higher productivity were accompanied by a stable economic environment with only one minor recession in 1990-1991, mostly induced by the consumer panic over the Gulf War with Iraq. As inflation declined after 1982 from 15% to 2%, 10-year bond yields dropped from 10% to 5% and stocks soared. Low inflation also meant lower commodities with gold declining from $800 to $300 and crude oil from $40 to $15. Real estate, reflecting the slower growth in inflation, did not display the phenomenal price increases of the 1970s. Financial assets were the great performers. Hard assets such as precious metals performed poorly - exactly the mirror image of the 1970s.

There is only one period when this great economic environment was disturbed. In 1992-1993, because of the real estate and savings and loan crisis, the Fed had to make money cheap to protect the U.S. economy and improve bank profitability by keeping the yield curve unusually steep. It did so by keeping short-term rates very low relative to inflation. This easy-money period was briefly followed in 1994 by the type of environment typical of the 1970s: rising inflation and bond yields, weak stock prices, soaring commodities, and a weak dollar.

The 1950s were in many respects similar to the years that followed 1982. Real short-term interest rates were kept above the historical average of 1.4. Inflation as a result was around 3%, bond yields were stable, the stock market was strong, and the dollar was the currency of choice. Gold was trading at $35 and the economy had two mild recessions. Financial assets were definitely a solid investment. Both bonds and stocks provided superb returns from 1982 as inflation declined, while hard assets such as precious metals and real estate did not perform as well as stocks and bonds.

It is very difficult to find a single indicator that can best give a sense of the economic times facing the investor. Real short-term interest rates are the only indicator that, with its simplicity and easy availability, explains the huge transition that took place from the 1950s through the 1970s and the years following the years 1982.

(From Chapter 5 of my book Profiting in Bull or Bear Markets. Published also in Mandarin and on sale in China. The book is available at Amazon.com).

George Dagnino, PhD Editor,
The Peter Dag Portfolio.
Since 1977
2009 Market Timer of the Year by Timer Digest
Portfolio manager

Disclaimer.The content on this site is provided as general information only and should not be taken as investment advice nor is it a recommendation to buy or sell any financial instrument. Actions you undertake as a consequence of any analysis, opinion or advertisement on this site are your sole responsibility.

STRATEGIC INVESTING FOR UNCERTAIN TIMES.
Learn how to manage your portfolio risk and sleep comfortably. Improve the certainty of returns by taking advantage of business cycle trends. Learn to use simple hedging strategies to minimize the volatility of your portfolio and protect it from downside losses.
You will receive your user id to access 4 FREE issues – and all the previous ones - of The Peter Dag Portfolio. Email your request to info@peterdag.com. New subscribers, please.

4/17/13

The incomparable Mr. Farage. A must see video.

George Dagnino, PhD Editor,
The Peter Dag Portfolio.
Since 1977
2009 Market Timer of the Year by Timer Digest
Portfolio manager

Disclaimer.The content on this site is provided as general information only and should not be taken as investment advice nor is it a recommendation to buy or sell any financial instrument. Actions you undertake as a consequence of any analyhttp://www.blogger.com/blogger.g?blogID=4393121024152614189#allpostssis, opinion or advertisement on this site are your sole responsibility.

STRATEGIC INVESTING FOR UNCERTAIN TIMES.
Learn how to manage your portfolio risk and sleep comfortably. Improve the certainty of returns by taking advantage of business cycle trends. Learn to use simple hedging strategies to minimize the volatility of your portfolio and protect it from downside losses.
You will receive your user id to access 4 FREE issues – and all the previous ones - of The Peter Dag Portfolio. Email your request to info@peterdag.com. New subscribers, please.

4/15/13

What Happened The Last Time We Saw Gold Drop Like This?

From ZeroHedge....The rapidity of gold's drop is impressive, concerning, and disorderly. We have seen two other such instances of disorderly 'hurried' selling in the last five years. In July 2008, gold quickly dropped 21% - seemingly pre-empting the Lehman debacle and the collapse of the western banking system. In September 2011, gold fell 20% in a short period - as Europe's risks exploded and stocks slumped ...

George Dagnino, PhD Editor,
The Peter Dag Portfolio.
Since 1977
2009 Market Timer of the Year by Timer Digest
Portfolio manager

Disclaimer.The content on this site is provided as general information only and should not be taken as investment advice nor is it a recommendation to buy or sell any financial instrument. Actions you undertake as a consequence of any analyhttp://www.blogger.com/blogger.g?blogID=4393121024152614189#allpostssis, opinion or advertisement on this site are your sole responsibility.

STRATEGIC INVESTING FOR UNCERTAIN TIMES.
Learn how to manage your portfolio risk and sleep comfortably. Improve the certainty of returns by taking advantage of business cycle trends. Learn to use simple hedging strategies to minimize the volatility of your portfolio and protect it from downside losses.
You will receive your user id to access 4 FREE issues – and all the previous ones - of The Peter Dag Portfolio. Email your request to info@peterdag.com. New subscribers, please.

The business cycle works

Weak economy leads to weak commodities, weak copper, weak gold, lower bond yields, lower material-sensitive stocks, staples stronger.

Are the central banks strangling the global economy?

George Dagnino, PhD Editor,
The Peter Dag Portfolio.
Since 1977
2009 Market Timer of the Year by Timer Digest
Portfolio manager

Disclaimer.The content on this site is provided as general information only and should not be taken as investment advice nor is it a recommendation to buy or sell any financial instrument. Actions you undertake as a consequence of any analyhttp://www.blogger.com/blogger.g?blogID=4393121024152614189#allpostssis, opinion or advertisement on this site are your sole responsibility.

STRATEGIC INVESTING FOR UNCERTAIN TIMES.
Learn how to manage your portfolio risk and sleep comfortably. Improve the certainty of returns by taking advantage of business cycle trends. Learn to use simple hedging strategies to minimize the volatility of your portfolio and protect it from downside losses.
You will receive your user id to access 4 FREE issues – and all the previous ones - of The Peter Dag Portfolio. Email your request to info@peterdag.com. New subscribers, please.

4/12/13

Do you get the picture?

Retails sales down. Consumer sentiment down. Gold and silver sharply lower. Commodities weak. Stocks down (not much). Bonds strong.

George Dagnino, PhD Editor,
The Peter Dag Portfolio.
Since 1977
2009 Market Timer of the Year by Timer Digest
Portfolio manager

Disclaimer.The content on this site is provided as general information only and should not be taken as investment advice nor is it a recommendation to buy or sell any financial instrument. Actions you undertake as a consequence of any analyhttp://www.blogger.com/blogger.g?blogID=4393121024152614189#allpostssis, opinion or advertisement on this site are your sole responsibility.

STRATEGIC INVESTING FOR UNCERTAIN TIMES.
Learn how to manage your portfolio risk and sleep comfortably. Improve the certainty of returns by taking advantage of business cycle trends. Learn to use simple hedging strategies to minimize the volatility of your portfolio and protect it from downside losses.
You will receive your user id to access 4 FREE issues – and all the previous ones - of The Peter Dag Portfolio. Email your request to info@peterdag.com. New subscribers, please.

4/10/13

....and now read this artice by a well known financial historian.

To read the opinions of Carmen Reinhart, the well known financial historian, just click here.

George Dagnino, PhD Editor,
The Peter Dag Portfolio.
Since 1977
2009 Market Timer of the Year by Timer Digest
Portfolio manager

Disclaimer.The content on this site is provided as general information only and should not be taken as investment advice nor is it a recommendation to buy or sell any financial instrument. Actions you undertake as a consequence of any analyhttp://www.blogger.com/blogger.g?blogID=4393121024152614189#allpostssis, opinion or advertisement on this site are your sole responsibility.

STRATEGIC INVESTING FOR UNCERTAIN TIMES.
Learn how to manage your portfolio risk and sleep comfortably. Improve the certainty of returns by taking advantage of business cycle trends. Learn to use simple hedging strategies to minimize the volatility of your portfolio and protect it from downside losses.
You will receive your user id to access 4 FREE issues – and all the previous ones - of The Peter Dag Portfolio. Email your request to info@peterdag.com. New subscribers, please.

4/9/13

Is the collapse of France the next black swan?

This is a well researched paper by a well known company (gavekal.com). Just click here.

George Dagnino, PhD Editor,
The Peter Dag Portfolio.
Since 1977
2009 Market Timer of the Year by Timer Digest
Portfolio manager

Disclaimer.The content on this site is provided as general information only and should not be taken as investment advice nor is it a recommendation to buy or sell any financial instrument. Actions you undertake as a consequence of any analyhttp://www.blogger.com/blogger.g?blogID=4393121024152614189#allpostssis, opinion or advertisement on this site are your sole responsibility.

STRATEGIC INVESTING FOR UNCERTAIN TIMES.
Learn how to manage your portfolio risk and sleep comfortably. Improve the certainty of returns by taking advantage of business cycle trends. Learn to use simple hedging strategies to minimize the volatility of your portfolio and protect it from downside losses.
You will receive your user id to access 4 FREE issues – and all the previous ones - of The Peter Dag Portfolio. Email your request to info@peterdag.com. New subscribers, please.

Here we go again. We do not seem to learn from history.

The Washington Post - The Obama administration is engaged in a broad push to make more home loans available to people with weaker credit, an effort that officials say will help power the economic recovery but that skeptics say could open the door to the risky lending that caused the housing crash in the first place.

George Dagnino, PhD Editor,
The Peter Dag Portfolio.
Since 1977
2009 Market Timer of the Year by Timer Digest
Portfolio manager

Disclaimer.The content on this site is provided as general information only and should not be taken as investment advice nor is it a recommendation to buy or sell any financial instrument. Actions you undertake as a consequence of any analyhttp://www.blogger.com/blogger.g?blogID=4393121024152614189#allpostssis, opinion or advertisement on this site are your sole responsibility.

STRATEGIC INVESTING FOR UNCERTAIN TIMES.
Learn how to manage your portfolio risk and sleep comfortably. Improve the certainty of returns by taking advantage of business cycle trends. Learn to use simple hedging strategies to minimize the volatility of your portfolio and protect it from downside losses.
You will receive your user id to access 4 FREE issues – and all the previous ones - of The Peter Dag Portfolio. Email your request to info@peterdag.com. New subscribers, please.

4/8/13

Observations

I just cannot resist. I have to write about it. I was updating my files with the commodity data in preparation for the next issue. Unbelievable.

They are so pompous with their pronouncements. So many PhDs, so many academic and public service achievements, you could fill several books. Yet, I cannot fail to feel how impotent they are. I am talking about the Fed and its board, of course. Above all they are bureaucrats and politicians. As in most large corporations, you do not want to look or act with boldness. If you are bold, you should not be there. You are there only because you are thirsty for power!

When in doubt, assume a middle-of-the-road posture. But in real life, when your neck is on the line, such behavior is equivalent to sudden death. The markets will devour you. No pity. No second chance.

I shiver when I look at the latest jump of commodities. When clients call and ask if we should buy more of them. When major financial magazines carry the story of great companies which capitalized on their relentless rise. This is the equivalent of the equity mania of 1995-2000, when the Fed nonchalantly debated its prospects. Precious metal experts are invited to the podium to pontificate about gold above $1000 because of the strong demand from India and China. Nonsense.

If you have been in this business as long as I have, you know you are witnessing a major bubble, like the one in the 1970s, the equity bubble of 2000, the housing bubble of 2005 (now in the process of imploding).

Bubbles are created by cheap money. You have cheap money when the Fed decides to set its price at low levels. When the money you “buy” from lenders is below its market price. Investors and entrepreneurs recognize the opportunity and jump on it. They borrow as much as they can because they appreciate the unique opportunity. I wrote about it in 2001.

It is not the demand from China. It is cheap money. And the sagging dollar is the final act signaling the failure of the Fed’s policy. They are asleep at the wheel. The markets will wake them up. And we will profit from it.

(This Observations appeared in the 5-22-2006 issue of The Peter Dag Portfolio ).

George Dagnino, PhD Editor,
The Peter Dag Portfolio.
Since 1977
2009 Market Timer of the Year by Timer Digest
Portfolio manager

Disclaimer.The content on this site is provided as general information only and should not be taken as investment advice nor is it a recommendation to buy or sell any financial instrument. Actions you undertake as a consequence of any analysis, opinion or advertisement on this site are your sole responsibility.

STRATEGIC INVESTING FOR UNCERTAIN TIMES.
Learn how to manage your portfolio risk and sleep comfortably. Improve the certainty of returns by taking advantage of business cycle trends. Learn to use simple hedging strategies to minimize the volatility of your portfolio and protect it from downside losses.
You will receive your user id to access 4 FREE issues – and all the previous ones - of The Peter Dag Portfolio. Email your request to info@peterdag.com. New subscribers, please.

4/6/13

No comments

Bloomberg - Fisker Automotive Inc.’s mass firings after receiving federal loans to build luxury plug-in cars is adding to the political debate over the U.S. government’s funding of clean-energy programs.

George Dagnino, PhD Editor,
The Peter Dag Portfolio.
Since 1977
2009 Market Timer of the Year by Timer Digest
Portfolio manager

Disclaimer.The content on this site is provided as general information only and should not be taken as investment advice nor is it a recommendation to buy or sell any financial instrument. Actions you undertake as a consequence of any analyhttp://www.blogger.com/blogger.g?blogID=4393121024152614189#allpostssis, opinion or advertisement on this site are your sole responsibility.

STRATEGIC INVESTING FOR UNCERTAIN TIMES.
Learn how to manage your portfolio risk and sleep comfortably. Improve the certainty of returns by taking advantage of business cycle trends. Learn to use simple hedging strategies to minimize the volatility of your portfolio and protect it from downside losses.
You will receive your user id to access 4 FREE issues – and all the previous ones - of The Peter Dag Portfolio. Email your request to info@peterdag.com. New subscribers, please.

4/5/13

Quote of the day

Deutsche Bank - If it really is as easy as printing money then all Central Bank's would have done it a long time ago. That such a period for global CB's is unprecedented should serve as a warning to watch for unintended consequences.

George Dagnino, PhD Editor,
The Peter Dag Portfolio.
Since 1977
2009 Market Timer of the Year by Timer Digest
Portfolio manager

Disclaimer.The content on this site is provided as general information only and should not be taken as investment advice nor is it a recommendation to buy or sell any financial instrument. Actions you undertake as a consequence of any analyhttp://www.blogger.com/blogger.g?blogID=4393121024152614189#allpostssis, opinion or advertisement on this site are your sole responsibility.

STRATEGIC INVESTING FOR UNCERTAIN TIMES.
Learn how to manage your portfolio risk and sleep comfortably. Improve the certainty of returns by taking advantage of business cycle trends. Learn to use simple hedging strategies to minimize the volatility of your portfolio and protect it from downside losses.
You will receive your user id to access 4 FREE issues – and all the previous ones - of The Peter Dag Portfolio. Email your request to info@peterdag.com. New subscribers, please.

Why are we doing so poorly?

Payrolls grew by 88,000 workers, the smallest gain in nine months and less than the most-pessimistic forecast in a Bloomberg survey, after a revised 268,000 February increase, Labor Department data showed today in Washington.

The number of people not in the labor force which in March soared by a massive 663,000 to a record 90 million Americans who are no longer even looking for work.

The economies of Europe and the US are doing poorly. Why? The reason is subtle. Read the excellent historical book Why Nations Fail. The book shows that nations stagnate when there is too much concentration of power. It looks like we have too much concentration of power in Washington and Brussels. They are overprotecting us by not allowing "creative destruction", the book suggests. We need to allow failure if we want to grow and give us a different point of view.

It looks like governments are becoming too intrusive. What they are doing is too generous and for good reasons. But it looks like all the good intentions are backfiring.

The problem is that the smart people know how to survive creating even bigger inequality among the citizens.

George Dagnino, PhD Editor,
The Peter Dag Portfolio.
Since 1977
2009 Market Timer of the Year by Timer Digest
Portfolio manager

Disclaimer.The content on this site is provided as general information only and should not be taken as investment advice nor is it a recommendation to buy or sell any financial instrument. Actions you undertake as a consequence of any analyhttp://www.blogger.com/blogger.g?blogID=4393121024152614189#allpostssis, opinion or advertisement on this site are your sole responsibility.

STRATEGIC INVESTING FOR UNCERTAIN TIMES.
Learn how to manage your portfolio risk and sleep comfortably. Improve the certainty of returns by taking advantage of business cycle trends. Learn to use simple hedging strategies to minimize the volatility of your portfolio and protect it from downside losses.
You will receive your user id to access 4 FREE issues – and all the previous ones - of The Peter Dag Portfolio. Email your request to info@peterdag.com. New subscribers, please.

4/4/13

What am I watching?

I keep my eyes on the markets. Forget about what the Fed and what all the other politicians are saying. They have a terrible batting average with their forecasts and opinions.

Commodities, bonds, stocks.

Right now commodities are sinking. They have been declining since 2011. It is very difficult to expect a strong economy with commodities going south.

Bonds are firm. Especially when the market is weak.

Stocks will be going nowhere if yields decline.

I base my strategy on my indicators and these relationships.

George Dagnino, PhD Editor,
The Peter Dag Portfolio.
Since 1977
2009 Market Timer of the Year by Timer Digest
Portfolio manager

Disclaimer.The content on this site is provided as general information only and should not be taken as investment advice nor is it a recommendation to buy or sell any financial instrument. Actions you undertake as a consequence of any analyhttp://www.blogger.com/blogger.g?blogID=4393121024152614189#allpostssis, opinion or advertisement on this site are your sole responsibility.

STRATEGIC INVESTING FOR UNCERTAIN TIMES.
Learn how to manage your portfolio risk and sleep comfortably. Improve the certainty of returns by taking advantage of business cycle trends. Learn to use simple hedging strategies to minimize the volatility of your portfolio and protect it from downside losses.
You will receive your user id to access 4 FREE issues – and all the previous ones - of The Peter Dag Portfolio. Email your request to info@peterdag.com. New subscribers, please.

4/2/13

Question

If the economy has been and still is strong...how come commodities have been weak since early 2011? And commodity-sensitive stocks have performed poorly?

George Dagnino, PhD Editor,
The Peter Dag Portfolio.
Since 1977
2009 Market Timer of the Year by Timer Digest
Portfolio manager

Disclaimer.The content on this site is provided as general information only and should not be taken as investment advice nor is it a recommendation to buy or sell any financial instrument. Actions you undertake as a consequence of any analyhttp://www.blogger.com/blogger.g?blogID=4393121024152614189#allpostssis, opinion or advertisement on this site are your sole responsibility.

STRATEGIC INVESTING FOR UNCERTAIN TIMES.
Learn how to manage your portfolio risk and sleep comfortably. Improve the certainty of returns by taking advantage of business cycle trends. Learn to use simple hedging strategies to minimize the volatility of your portfolio and protect it from downside losses.
You will receive your user id to access 4 FREE issues – and all the previous ones - of The Peter Dag Portfolio. Email your request to info@peterdag.com. New subscribers, please.

Observations

I was sitting in the cockpit of my boat, resting after doing many little chores to get her ready for the sailing season. They are all important and they all need to be done.

Time flows at a different pace at the marina, almost in slow motion. It allows you to think about many things away from the pressure of the markets.

Why do we do what we do? We have many choices, of course. But we end up doing things that we may not like. Two people walked on the dock. We began talking. The first one lives on his boat close to mine. He is a retired businessman. Satellite TV and wireless computer connect him to the world.

He was also working on his boat. Planning to go somewhere? Yes, Bermuda. Perhaps for a few months and then he will come back. The second gentleman, the executive type, sails in the Bahamas in winter. He comes north in summer and works at a marina. I told him I envied him. Just do it, he answered. Time flies. Do it before it is too late.

These chats, sipping a cup of hot coffee early in the morning watching the sun rise, made me think about choices and how we decide what we do.

Often we complain about what is happening to us. We should be taking some action, but we fall asleep at the wheel. We exclude all the alternatives because we are comfortable with what we have. It is about security. I watch SNS closely. His life is about doing new things. New projects. He solves the problems as they present themselves. Just do it. Simple words implying staying at ease with risk-taking. But it is not only risk-taking. You need to have an unlimited passion for what you do. My passion is navigating the financial markets.

Passion and risk-taking give you the adrenaline rush that makes you look forward to the next day, with all its uncertainties and challenges. It is like going sailing to Bermuda or the Bahamas. It depends on you. Just do it.

(This Observations appeared in the 5-8-2006 issue of The Peter Dag Portfolio ).

George Dagnino, PhD Editor,
The Peter Dag Portfolio.
Since 1977
2009 Market Timer of the Year by Timer Digest
Portfolio manager

Disclaimer.The content on this site is provided as general information only and should not be taken as investment advice nor is it a recommendation to buy or sell any financial instrument. Actions you undertake as a consequence of any analysis, opinion or advertisement on this site are your sole responsibility.

STRATEGIC INVESTING FOR UNCERTAIN TIMES.
Learn how to manage your portfolio risk and sleep comfortably. Improve the certainty of returns by taking advantage of business cycle trends. Learn to use simple hedging strategies to minimize the volatility of your portfolio and protect it from downside losses.
You will receive your user id to access 4 FREE issues – and all the previous ones - of The Peter Dag Portfolio. Email your request to info@peterdag.com. New subscribers, please.