I figured the whole thing out on Twitter and Facebook and have the perfect strategy.
I created the perfect market beating algorithm. No drawdowns. This f@#!king fund just goes UP.
My fund measures how many people follow me on any given Wednesday with the names Jesus and Obama is their profile. If it is more than 3, the market goes up on the following Tuesday.
If you would like in, just send me your wiring instructions. My Nigerian partner will take care of the rest.
After 20 plus years in the money business, it continues to amaze me how people chase returns. People will do it in 2050 and 2090.
The financial world is dominated by marketing and scale. It makes sense. The SEC is in 1984, open and shut cases are not even prosecuted and there is no better scalable business in the world than managing other people’s money.
Warren Buffett knows this so he only invests in sure things. When he invests, the outcome is already decided. It was not always like this for him. He took risk once upon a time. Now he would be competing against imbeciles and machines and he is too smart for that.
While Warren guarantees his future, ‘accredited’ investors chase funds like Jon Paulson who is in the scale business and marketing gimmicks like ‘Derwent Capital’ which claims they can predict the market using Twitter.
Predictions do not matter. Managing risk matters. As I mentioned a few weeks ago, Markets can’t be Tamed, Just Managed.
I do believe there is signal in Stocktwits and Facebook and Google and Twitter profiles with ‘Christ’ in them. Go sign up for an Etrade account and blow your brains out with their toys and a Twitter account.
It has never been easier to get in the ‘game’, but it has never been less of a ‘game’ to those who want to make a profession out of it. The markets are in serious trouble because liquidity for stocks is on a path of doom.
Ask any 20 year old that is learning how to trade with social networks and any 20 year old that is an entrepreneur. They prefer to play games on their mobile phones and invest their money in other people, not stocks and bonds.
I hear it everyday and it pisses me off. It should not be like this at all. In 2011, with all the tools at our disposal, investing in public companies should not be considered just a game.