Yesterday, the market lost about 2% and I had bought several stocks at 'bargain' prices (will find out in a month or so whether they're traps or bargains). Here are what I did to kill time, similar to what you're doing at the moment.
* Fishing.
When you do not fish (looking for good stocks to buy), you repair your net (revising better methods to evaluate stocks). Recently I found out the hard way that I really had to use two methods for evaluating stocks: 1. one for stocks I hold for longer than 12 months (for taxable accounts) and 2. one for stocks holding for an average of 4 months (for swing trades). I've about 2 years of real data from my trades to test out the parameters such as expected P/E. You may call it smart data mining or dumb data curve fitting.
* On political systems.
As opposing to popular belief, Canada is communist, US socialist, and China capitalist. It looks funny but is not far from reality. Here is my argument using health care.
Every Canadian has the same free health care (I do not know the availability and the quality) no matter how rich or how poor you're. Hence, you do not need to save and/or work hard to get better health care. This is the biggest fault of communism.
US encourages its citizens to buy health insurance, but provides it free when you're in emergency room, whether you're legal or illegal resident. That's one of the major reasons we have the most inefficient health care system.
In China, you do not pay, you die. Hence, you need to save and work hard. It is great for the rich and powerful, and a powerful way to control population growth :). I'm not saying China is a great country. The fact is there are more folks moving to US legally or illegally to US than to mainland China.
* To respond to a fellow blogger's praises with sarcasm.
I do not deserve all the flattering, but thanks anyway as it makes me feel good. It is the same feeling to hear the flatters from the prostitutes saying how great your performance is (just an observation). Do not be offended by my jokes as I do not take life seriously.
It is too late for me to make bigger bucks and I do not have a desire to do so. My secret weapon is: I do not need big bucks to be happy and my children would have no meaning in life by inheriting money (a great lesson from Buffett).
I do not see myself writing for WSJ (may be WSJunk) beside reading it, but would like to share investing ideas here and there. My work and hobby is developing a holy trail in investing. Many experts have passed same path and few succeed. Some 'succeed' due to dumb luck. This is my theory of a thousand monkeys banging on the keyboards to find good stocks. At least one monkey finds a great stock.
Buffett is very smart and he has a photographic mind. Like most 'mad' professors, he concentrates in works that are important to him. He made 10,000 times more money than us (at least than I), but he cannot be 10,000 smarter than us.
I've many theories how to develop the holy trail in investing but little time/data to test them out. There is a very high possibility that I'll find no such trail before I die, but I'll enjoy spending time in searching for one. I would die with a big smile for doing what I enjoy most, not due to fame and glory but for the chance to try something I've never tried before. It keeps me cheerful and hopeful similar to the days after I bought a lottery ticket and before the winner was announced.
If I do found the holy trail, I'll donate my life-long 'loots' to deserving (most US poor are not) charities (another lesson from Buffett) and win the Nobel Prize (please do not wake me up.) I would win it by saving/giving/working hard and Obama got his by spending. Who deserves it more? Be the judge yourself.
* On China's bullet train crash.
I hope we learn from our tragedies.
As in my previous posts, China sets the priorities wrong. It is great to be #1, but we have to consider many other issues like safety, quality control, image (esp. for China Inc), maintenance, operations, regulations, corruption (when big money involves, there is corruption naturally), pollution… You do not get promoted or get a medal for doing the above, but some could lose his/her job if something goes wrong.
There are so many past examples such as the fires on high-rise buildings, collapsing of bridges and roads... If we never learn, we will never advance. Hope it is a wake up call. If we prepare for the worst to minimize accidents, we should pad our shoulder for jobs well done, even there is no material gain.
To summarize,
A genius always minimizes accidents.
A smart man always fixes after the accidents happen.
An idiot blames the accidents on someone else and never fixes the problem.
* Your reward for your patience in reading all my garbage.
To prove how stupid I'm, I read it two times before I understand it.
In a nutshell, Mr. T defined the least expected events as black swans. It could be the reason for most of the scientific discoveries and also some investors' blunders.
Click here.
If the clicking does not work, try cut and paste.
http://www.gladwell.com/2002/2002_04_29_a_blowingup.htm
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