$50 on "EZ Lay" in the Fourth

"Rule No.1 is never lose money. Rule No.2 is never forget rule number one."

--Warren Buffet


I've never been to Foxwoods or Mohegan because I have almost zero interest in gambling. I have played the dogs at the track in Lincoln when I was 18. I bet two races and lost both. I found myself thinking, “Where's the fun in that?” Not only that, but the place was filthy and filled with short Colombians who acted like they were betting their kid's college educations when in fact it might have been $5 a shot. The way they cheered or bemoaned various dogs with all their hearts was something to see. If you ever wanted to feel your skin creep, that was a great place to have it occur.

But...put me in front of a stock screen and I'm warming up the dice in my palm. When I couldn't understand the odds posted for a dog race, I can sit here and watch Amgen's bid/ask spread tell me much. Ask me about Catfish Hunter's stats for “hits allowed” for the season of 1976 and I'll blankly stare at you. Show me a MACD of Amgen...and I'll tell you whether I'd buy it or not. But that's after consulting S&P's score and Amgen's stats.

I haven't played Wall St's ponies in a long while. That crash in late 2008 was enough to make anyone puke. A major reduction of up to 50% in all stocks, which meant that if you did nothing, your investment was halved, would make anyone shy away. It did me. But the market has since “recovered” then with the Feds jumping in with programs such as ZIRP, QE 1, 2 & 3. The jist? Your kid's and grandkid's futures, in the form of them paying for it by their taxes, propped up today's market. “Borrowing from the Future” I think it's called.

Even as the market was going up, basically guaranteed by the US Gov't itself, the distaste I felt due to that last crash kept me away. Wall St is an expensive casino, there are no quarter slot machines, no $1 tables. Wall St's cheapest table is $2,000 and it goes up to infinity from there. If you can't plunk down two grand on a bet, you can only watch. You want to bet $2,000 after knowing how the markets can act? Losing $5 bucks to a slot machine is a very minor annoyance. Try losing two grand and see how you feel. And to make appreciable money, that you can feel, you need to bet ten times that or more. A one percent move on $5,000 is a lousy $50. It's almost pointless, considering the commission you're charged to place the trade. The same percent on $50,000 is $500. The larger the bet, the more the commission seems to fade. Get the picture?

But I'll tell you, there's nothing more satisfying than making money by clicking a mouse. It's money you never worked for too. It seems almost magical the way it works. But don't get too starry eyed over the whole thing, as it's all done with the seriousness of cancer. Also, you're playing against some pretty savvy people and/or computers programmed to outthink you. You have to keep your shit wired tight at all times if you play this particular game.

So today I fired up my old stock trading platform just to watch. I saw the day traders, betting the usual 100 share lots at a time. If they're successful, they'll make some small cash on each trade, but end up paying through the nose on commissions. Occasionally I'd see someone toss down a bid for 5,000 shares. “That guy has some balls...or pools of cash” I'd think. The platform I have can allow you to use it with “play money.” It's just a simulator that uses the same market data. I played with it using limit orders and was surprised to see my buy order filled just as the pressure of my finger was coming off the mouse button. “Shit! That took less than a second!” It seems things have been improved since I played the ponies in 2008.

Will I play it with real money?

The problem today is that the entire market is two standard deviations over it's mean which means: “Too fuckin' expensive!” This is a time to sell, not buy. By all rights, this market is due to scale down some. But the answer to which no one can predict is: When? When is always the question and no one has ever nailed it.

The next sounds awful but there's a reason behind it. I want the market to throw up. I want it to slip in the bathtub and bust it's head. I want to see it dive like a brick. Why? Because you buy stocks LOW so they can go up later on. It's all cyclical. So here I am, praying earnestly to God for a crash.

I've never shorted a stock, which is when you literally borrow it from someone on contract, sell it immediately, keep the cash on the sidelines and BEG for the market to die. When it does, you buy the stock back and hand the shares back to their proper owner, with you keeping the difference in $.

You profit from the market's death, doom, misery and destruction. No joke, it's legal.

The problem is that there's no limit on how much you can lose. If the stock you shorted happens to keep going up, for the length of the contract you ordered it, you OWE the rightful owner the current price of those shares, which can be far higher than what you contracted them for.

I'm always a “long” stock owner. You can only lose what you originally put up. But even so, the market is far too high now and I want it to catch double pneumonia, for a while at least...enough to put it in the hospital and on a respirator...for a bit at least...please?

God..this is such a mercenary environment, ain't it? Welcome to America!

A snapshot of Amgen today...a fantasy baseball league if you will...