There are five trades I want to reflect on from my college days. Each trade represents a new trading phase. And I went through many phases, much like a student who kept switching majors. I want to do political science. No, maybe programming. Hmm, but what is all this hype I hear about eastern european gender studies? Nah, I’ll do film and broadcast–I do love movies after all! But then I eventually settle on business economics because it’s bland and it’ll get me a job.
- Buying gold bullion in 2008
- Buying AAPL when Steve Jobs announces medical leave (don’t ask me where I sold it)
- Buying a small biotech with a drug that… cured laughter??
- Shorting AIG after it went from $6 to $40
- Shorting some scam micro-cap called InfoLogix
Buying Gold Bullion in 2008
We all had our narratives to explain why this huge, spectacular, horrible thing was happening to the market and the underlying economy. I had mine.
- Vote Ron Paul otherwise you’re just voting for the evil government-loving Republicrats
- No bailouts or nationalization! I say let them fail and see what happens. MORAL HAZARD!
- End the Federal Reserve! Bunch of no-good money printers stealing my wealth.
- Mainstream economics was 99% politically-driven fallacy and masturbation in linear regressions. I called my Econ 100 professor a neoliberal shill on the margins of my midterm since I knew he graded them himself. I also told a policy class TA to fornicate with himself because of he told the class how great the New Deal was.
- Everything happening the economy is happening because people are stupid and governments are incompetent and/or corrupt. We printed too much money, we got greedy, and Greenspan created this gigantic housing bubble. Now we’re grade-A FUCKED. That was my narrative.
- Hyper inflation was imminent! We were on the precipice of an extraordinary collapse of confidence in the U.S. dollar once the Fed tries to print their way out of this mess. Peter Schiff said so and I bought his book!
2008 Peter was ready for $10,000/oz. Gold. He was ready for anarchy in the United States. He was ready to claim his status as an oracle and a market prodigy. He was ready to give all these idiots around him a big fat, resounding “I told you so!”
ENTRY.
TRADE MANAGEMENT.
EXIT.
POST-HOC ANALYSIS.
Ouch.
I loved those gold coins. They were like family to me. My little shiny metal children.
It pained me to sell them but I had to let go. In those 5 months since buying, I had unsubscribed from the gold bug libertarian cult. 2009 Peter had learned the folly of his ways. He needed liquidity so he could move onto the next phase and make godlike returns from his new strategy.
2009 Peter was going to a new Peter, a better one. He was going to be…
a Value Investor™…
