12 Things I Learned from My Recent Vacation in Maine

作者:Victor Niederhoffer
日期:2011/08/15

It's always good to learn and a vacation is a good time to learn more things. Here are 10 things I learned from my recent vacation in Maine.

1. The refutation of a hypothesis often causes more violent movement than a confirmation. The rejection of the idea that the market needed an extension of the debt limit in order not to fall, caused the great decline.

2. The three greatest declines in recent history came when a clash between the welfare state and the enterprise economy was resolved in the formers favor. The debt extension without teeth, the Tarp in October 2008, and the Baker intervention to get the mark up over the October 18, 1997 are recent examples.

3. The declines in the summer are often more violent than in other months except for October because the interventionists take more time to get their houses in order as they are vacationing in the Hamptons or Riviera, and can get frightened more easily.

4. Negative sequences of 2 or more through big round numbers become avalanches and trigger all sorts of panic selling. A break of a pivot of long standing duration like 1250 can inordinately create a cascade.

5. The ability to not get overextended is the key to success in markets or business. It is pitiable to see all those forced out by margins, or total fear at the bottom because of too little capital.

6. The round number of 1000 is an attractor and the decline was not over until the market breached the 1100 level and fell to the 1000's on Sunday, Aug 14.

7. The book Fur, Fortune and Empire by Eric Dolin is very good reading to show how commerce causes the establishment of countries, the forces of war, and friendship and alliance between trading parties. The founding and survival of America by the Pilgrims and the French and Indian wars as well as many others were caused and fomented in the main by the waxing and waning profitability of the beaver trade and its elusiveness and ingenuity and rarity when hunted into extinction.

8. Big moves around 1 GMT are reversed to an inordinate extent.

9. The declines in the US markets are inordinately preceded and signaled by related declines in the European markets, — the ratio of Germany equities to us fell from 6 to 5.5 before declining below 5. And oil fell below 100, and fixed income had a tremendous rise all before.

10. A ride up US 1 from New Hampshire to Maine is one of the most interesting that a person can take, and there are 100's of attractions that a person can stop at with a family that will enhance a vacation. Particularly attractive to me on a recent trip were the Desert of Maine, the Monkey See Monkey Do, L.L Bean, The Music Box, Owl's Head and Farnsworth museums, and the golf course at the Samoset, who showed the colonists where to find furs, and where Jimmy the starter at 92, who started caddying there in 1932, should be a National Icon.

11. The moves in Europe seem to know that a person can't stay up 48 or 72 hours straight and often do exactly what you thought they'd do the previous day when you are too tired or dissipated to take a position.

12. When taking out small moves from the market works, it will lead to disaster as big moves against dwarf out the profits from the previous and charts and stops and key trading points must be adjusted accordingly.