Digital Diatribes

A presentation of data on climate and other stuff

Here’s Where I’ve Been…

Posted by The Diatribe Guy on April 15, 2009

It has been a while. I thank you for your patience. Any of you who grew accustomed to coming here for my updated numbers deserve my sincerest apologies for dropping out of sight. Going forward, please continue to check in occasionally. Perhaps on a bi-weekly or monthly basis. I will not be posting as frequently as in the past for the foreseeable future, but do plan on posting more than I have in the past month or two (which is basically nothing).

I believe I owe it to you to explain why this sudden switch in my habits occurred. I do so knowing in advance that many will see my time spent foolishly. I’m fine with that.

This really started last September. I have posted in the past that I am employed by a particular company that has basically taken about as large as a beating from the press and politicians as imaginable. Much if this well deserved, and much of it not. I am not here to denigrate my employer nor am I here to defend it in all aspects. And, fortunately, I am somewhat insulated by all the goings-on because of the particular entity I work for.

However, while not a lot has personally changed for me on the exterior, a lot has changed in how I see my place in the world. My company is a very solid operation, but nonetheless has its own vulnerabilities, particularly if there is an extended economic downturn. And, personally, I believe that, in the next 5-10 years, the current issues we are experiencing will be child’s play. I am not here to ask anyone to agree with me or subscribe to my political philosophy. But I must share my viewpoint here to better outline why I’ve been up to what I’ve been up to.

With the bailouts in September and October, our system changed. This was not a good thing, in my view. Then, after the abominable (in my view) stimulus package, we threw ourselves over the cliff. I firmly believe that we will see a short-term (1-3 year) bump from this, and then the day will come where China and other stakeholders stop supplying loans to us, and worse yet – calls their existing loans back – and we will be absolutely devastated. We will have two options: default, or print trillions of dollars on top of what we are already printing. In a very short time, the dollar crashes, everything that we import (basically everything) will increase in price – perhaps tenfold or more – and overnight we are at a point of no return.

And you’re saying… what the hell does this have to do with blogging?

Well, I suppose if you do not agree with my stark assessment of the future, you think I’m being silly. That’s OK. In fact, I absolutely hope you are correct. But if I’m right, then it required me to really assess my situation and do everything I can to protect my family. All my free time has been in doing research and trying to figure out who to listen to and who not to, and to really have a plan of action for ourselves. At the same time, my goal is to do things that are prudent under any circumstance.

This post could go on forever with what this all entails, but I won’t bore you with all that. It’s just been very time-consuming, and I feel there is an urgency to this. I expect that, in the short-term, we have an opportunity to prepare for the long-term.

I had to assess many things, and one of those things is “what happens to my family if, worst case, I not only lose my job but can’t find another one?”

This spurred me on to many options. One option is somewhat out of the ordinary. It is the Forex (Foreign Exchange) market. I have spent countless hours researching this market, testing trading strategies, learning to program in the language of the trading platform, and so on. The volume of learning I have done, and have yet to do, is huge. And this, primarily, is where my blogging time went.

Now, it’s fair to ask how this all comes into play. Especially if you are aware – and many surely are – that depending on the estimate, 80% – 95% of all people trading in the market lose money. This isn’t exactly perceived as a low-risk venture to protect the family!

Well, there are different ways to view this. If you simply consider it investing, then a passive investor is nearly sure to lose money. A non-passive investor has about a dozen different pitfalls that will end up in money-loss. I have become convinced over the last three months from my own efforts that the reward here is directly proportional to knowledge, strategy, money management, and experience. We’ll see, though. Now, I’m not necessarily here to convince anyone of anything. But what I can offer is that I am not approaching this as an investment. I am approaching it as a business. The percentage of small businesses that fail are similar to the Forex numbers, and for many of the same reasons. I am willing to struggle through losses to learn, because I’d be investing in a business, anyway.

But this market makes sense to me in these times, because I can envision our traditional investments in stocks and real estate potentially becoming worthless. This is, for me, a diversification of funds, and an alternate method of wealth generation that – if it works out – is the first step towards not being dependent on my job in 3-5 years. Of course, it could fail miserably. And that’s OK. I’m only risking money I can afford to lose, and I won’t be any worse off a few years from now than if I didn’t try. Besides, even if ALL the other reasons for doing this end up not being a concern, the analysis using trends and different indicators is really a lot of fun for a guy like me. I am riveted by the constantly updating charts and data. I can really play the role of geek with that.

I really don’t know if anyone is interested on all this or not. I just felt I owed an explanation. Silly or not, it is what it is. And this will require continued effort on my part, which means I do not anticipate getting back into extensive blogging. Now, if I make millions and quit my job, then that’s another story! (So, if someone has millions to give, if they really, really like my blog, I’m all ears!)

OK, so having posted this, you’ll be happy to know that I have the charts saved and the numbers scribbled for UAH. A post is forthcoming on that update!

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9 Responses to “Here’s Where I’ve Been…”

  1. Layman Lurker said

    Good to here from you Joe. I hope everything works out for you in your research and resulting action plans. I think the economy is only scary for those who just sit back and let things happen. You are on the right track.

    Remember, the economy may rise or fall but the “Packers” will go on forever! 🙂

    ps: go Vikings

  2. Page48 said

    “And, personally, I believe that, in the next 5-10 years, the current issues we are experiencing will be child’s play.”

    Weird – before I read the above quote I sent an almost identical statement to a friend. Sad as it is, I’m glad to know that I’m not alone in my assessment of our economic future!

    I enjoy your blog.

  3. The Diatribe Guy said

    Layman – you risk being banned with your positive statements about the Viqueens… (just joking, of course. All in good fun.) Isn’t it great to have something like sports to take you away from reality for a few hours here and there? Sigh… too bad the Packers have done absolutely nothing in the off-season to get me excited. Don’t get me wrong, I’m not saying that isn’t the right course. It’s just that it’s boring, and it would be fun to have some news about the Pack to take me away from other news.

    Page48 – It is a remarkable thing that I’ve seen lately with regard to a great number of people who feel the way I do. I’m talking about reasonable, well-educated, non-nutjob people. (I leave it to the reader to label me in that category, but I won’t be offended if a different conclusion is reached…)

  4. Nosyam said

    Joe

    I have been studying the fx market for much the same reasons as you. Experienced and successful traders in the blogosphere who are willing to share their knowledge are rare but I have been fortunate to have been following such a trader at http://waynejacksonfx.blogspot.com/. He also treats his trading as a business and he is ( and now I am) definitely in the 5% who are making money.
    Good luck with your endeavours.

  5. The Diatribe Guy said

    Thanks, Nosyam. I will definitely check it out. I, also, found a pretty nice resource online that you may wish to look into. http://forex-strategies-revealed.com.

    There are numerous online resources that explain indicators and all that, but few who are really willing to share strategies and such.

    I will most definitely check out that blog, and I thank you for the assist.

  6. A.Syme said

    I appreciate your concern for you finical future. I got out of the market two years ago when the China market did a dippsy-doodle. I thought it was going to be the event that would trigger an October of 08 type of crash. Been in cash ever since. The best investments may be in a wide open market, where the risks are well known, and you can manage them. Control is everything!

  7. The Diatribe Guy said

    Thanks for the reply, A. Syme. To be clear, I am not offering advice to anyone. Do your own research, and come to your own conclusions. Also, to be clear, I have not completely pulled out of the market. I’ve considered it, but I also am trying to balance all my options. I could well be wrong on my assessment, and I know that. If I’m wrong, then we recover, as does the market, and in 30 years I’m sitting OK.

    But I don’t want to simply rely on the market and my 401(k). I think we’d all become conditioned to just plunking 6-10% into the market, letting it ride, and expecting to have a bundle in retirement. Well, we’ve seen what can happen – at one point early this year the DOW was trading at less than 50% of it’s previous high. Retirements were postponed.

    Investing is fine, but everything carries risk. When things are good, it doesn’t seem like it does. Without getting into details, I am working very hard at shoring up in a few key areas: (1) get completely out of debt – even the mortgage (but don’t down on the mortgage if it leaves you dry of liquid assets. Wait until you have enough to pay the whole thing off, and then do it.) (2) Diversify into areas I’d never considered. For me, that is precious metals. I also considering eliminating debt an investment. (3) Approach monetary activities more like a business than an investment. For me, getting into Forex means removing emotion. It’s abouot testing strategies and not moving in too quickly. It’s abouot learning and understand the risk and the rewards. THe huge profit potential lures people in, but that same potential can lead to huge losses that you can’t recover from unless you have a very serious plan. It can be done.

    Nosyam, are you employing the strategies of Wayne Jackson? I read through a lot of it this weekend. Very interesting. One of my issues is capitalization in order to implement that kind of approach. I may need to wait, but I will continue to learn that.

    If it behooves you, I wouldn’t mind getting an e-mail at geezep@yahoo.com from you. I mainly just want to verify that I understand his strategy well, and wouldn’t mind having someone take a look at my understanding of it. I’d rather do that off-board, since I don’t ahve an interest in turning this into a Forex forum. If not, that’s fine, and I understand.

  8. Tenuc said

    You could well be right about the coming depression and I think we ‘ain’t seen nothing yet!’.

    I’m sure you’ll already have heard of Nikolai Kondratieff’s economic long wave cycle theory (K-wave); there’s a good description of it on the link below if you haven’t.

    http://www.kwaves.com/kond_overview.htm

    Good luck with your Forex venture and if you don’t like it after you’ve tried it then basic consumer durables will be worth a punt, but do get in early to beat the rush…

  9. The Diatribe Guy said

    Yes, I have read up on that theory. I largely agree with it simply on common sense. However, I think we’ve exacerbated the wave by comingling socialist policies with capitalism. We at once loosened credit to the point where we had unabated excess and capitalism that we all really knew was creating an unsustainable bubble in many areas.

    To make matters worse, our government didn’t sit around and let capitalism take its course. They fed it by spending like socialist drunken sailors. And when the market crashed, what did we decide to do to solve it? We spent a trillion dollars we don’t have.

    The longer and more we prop this up through reckless spending (even more than past reckless spending) the harder the crash will be. I agree with you. The stock market falling 40-50% is going to be child’s play.

    As for Forex, I am still working hard at it. I’ve looked at a number of angles. I have lost money, but within reason. I truly feel like I will work harder and learn better if I have ‘skin in the game.’ I think I am finally getting to a basic winning strategy: bet on the long-term, not short-term. I have post #4 to thank for introducing this mroe legitimate concept. And the long term view from my end is: bet against the U.S. dollar.

    So, I’m trying to incorporate a longer-term trending approach against the dollar. By limiting risk, I basically plan on just hanging around and always having some position in the market. I imagine I will make a little, lose a little, break even a little… but if and when the dollar crashes, I want to be in the market. Call it a hedge so that I don’t get hurt as badly as I otherwise would.

    I have thought about which basic consumer durables to “buy and hold.” Ammunition is a great investment right now – you can probably do better at that than gold. But I have been buying some gold, silver, and collectibles. The actual coins, not a contract.

    Most importantly, I’m trying to get out of debt. Even my mortgage. I’m less than 5 years away right now on that, and hope to speed that up as income allows.

    Interesting times we live in.

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