Today is a day that I wish I didn’t do what I do. I literally feel as if the market is just plain stupid. In fact, I feel like laughing at how idiotic the market can be. Ha … Ha … Ha.
There’s no need to go into the reason for my sentiment this morning. All one has to do is look at the market’s behavior right out of the gate. I am saying the same thing about the Asian and European markets as well. They too are stupid sometimes, and today is one of those days.
The noise out there in breathless media land is that the Bank of Japan didn’t do enough to settle the volatility in its bond market. In other words, the markets wanted more, not less, government intervention. It reminds me of those days not too far back when the market flipped out about the ECB not “doing enough” to calm its bond markets. In the end, it did what it had to do, and so will the BOJ, eventually. They always do.
So, do you see why I feel so “awnry” about the markets today? They are just stupid, period. And, that makes me wonder why I play this stupid game, well, at least today, anyway.
The good news is that there seems to be nothing strong about the price-action in the market. My trades, although slightly down, are doing fine. The folks who buy and sell those shares seem only mildly concerned that the supposed grown up market is running around screaming like a child afraid of a mouse. So, I see no panic today. Although the market is stupid, one never knows what might happen if another mouse shows up.
I do have something today that is not stupid, though. It is a question from a reader that reflects concern about the future, i.e., what will inflation do?
- I have part of my portfolio in commodities, gold and silver ETFs, gold stocks, and about 5% in TIPS, as a kind of insurance. I have a loss on the TIPS the past 3 weeks, but am thinking I should just hold on to them. I see, Bill Gross is planning on buying more TIPS at the currently low price? Any thoughts?
All of the pieces mentioned as part of her portfolio reflect her concern about inflation. Commodities tend to run up with inflation, as does gold and TIPS, which are a sort of insurance program against inflation. TIPS are Treasury Inflation-Protected Securities — treasury securities indexed to inflation in order to protect investors from the negative effects of inflation.
My thoughts? Well, I have expressed my thoughts on the foolishness of buying that soft metal gold numerous times, so I won’t go into that, but here is my thought on inflation – there isn’t any at the moment, so what are you protecting against?
As to Bill Gross and his PIMCO fund, here is another thought. Why follow him? Check this out.
- Bill Gross’s PIMCO Total Return Fund (PTTRX), the world’s largest mutual fund, declined 1.9 percent this month, the biggest monthly loss since September 2008.
Now, how does one manage the world’s largest mutual fund and lose money in this market? Here is how.
- The performance of the $293 billion Total Return Fund puts it behind 94 percent of similarly managed funds through May 30, according to data compiled by Bloomberg. The fund’s allocation to Treasuries has hindered performance as government-debt securities fell 1.8 percent in May.
I hope my thoughts help, even though they come from an “awnry” place …
Trade in the day; Invest in your life …
