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Fri, 23rd June 2017

Anirudh Sethi Report

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Archives of “conservatism” Tag

Japanese Prime Minister Shinzo Abe’s approval rating plunges amid lingering school scandal

Support for Japanese Prime Minister Shinzo Abe’s government has dropped below 50% for the first time in more than a year as respondents expressed dissatisfaction with his response to allegations of preferential treatment toward a conservative educator.

The cabinet’s approval rating plunged to 49% in a weekend poll by Nikkei Inc. and TV Tokyo, down 7 percentage points from May and 11 points compared with April. The government’s disapproval rating climbed 6 points to 42% — the highest since October 2015.

 This marks the Abe cabinet’s most serious setback in public opinion since that year, when legislation expanding the armed forces’ remit ignited a public debate on Japan’s commitment to peace.

Now, the prime minister is facing allegations of favoritism over plans to establish a veterinary school in a government-designated special zone for deregulation. The prospective school operator, Kake Educational Institution, is headed by a friend of Abe’s.

The government insists that all of the proper procedures were followed in approving the new school. But a purported memo describing the project as in line with “the prime minister’s wishes” — a document whose credibility the government had questioned — has been found at the ministry of education after a second internal investigation.

The ruling coalition’s move to cut short the upper house debate on anti-conspiracy legislation also seems to have contributed to the drop in support. Among other things, the recently enacted law makes it a crime to plot terrorist attacks. Nearly half, or 47%, of respondents support the law, which has raised concerns among civil liberties groups, while 36% are opposed.

The cabinet’s approval rating fell among both men and women. Only 24% of respondents unaffiliated with any political party expressed support for the government, down 5 points from the previous survey.

The 7-Trading Rules

Here are the rules – they are not unique or new. They are time tested and successful investor approved. Like Mom’s chicken soup for a cold – the rules are the rules. If you follow them you succeed – if you don’t, you don’t.

1) Sell Losers Short: Let Winners Run:

It seems like a simple thing to do but when it comes down to it the average investor sells their winners and keeps their losers hoping they will come back to even.

2) Buy Cheap And Sell Expensive:

You haggle, negotiate and shop extensively for the best deals on cars and flat screen televisions. However, you will pay any price for a stock because someone on television told you too. Insist on making investments when you are getting a “good deal” on it. If it isn’t – it isn’t, don’t try and come up with an excuse to justify overpaying for an investment. In the long run – overpaying will end in misery.

3) This Time Is Never Different:

As much as our emotions and psychological makeup want to always hope and pray for the best – this time is never different than the past. History may not repeat exactly but it surely rhymes awfully well.

4) Be Patient:

As with item number 2; there is never a rush to make an investment and there is NOTHING WRONG with sitting on cash until a good deal, a real bargain, comes along. Being patient is not only a virtue – it is a good way to keep yourself out of trouble.

5) Turn Off The Television:

Any good investment is NEVER dictated by day to day movements of the market which is merely nothing more than noise. If you have done your homework, made a good investment at a good price and have confirmed your analysis to correct – then the day to day market actions will have little, if any, bearing on the longer-term success of your investment. The only thing you achieve by watching the television from one minute to the next is increasing your blood pressure.

6) Risk Is Not Equal To Your Return:

Taking RISK in an investment or strategy is not equivalent to how much money you will make. It only relates to the permanent loss of capital that will be incurred when you are wrong. Invest conservatively and grow your money over time with the LEAST amount of risk possible.

7) Go Against The Herd:

The populous is generally right in the middle of a move up in the markets but they are seldom right at major turning points. When everyone agrees on the direction of the market due to any given set of reasons – generally something else happens. However, this also cedes to points 2) and 4); in order to buy something cheap or sell something at the best price – you are generally buying when everyone is selling and selling when everyone else is buying.

These are the rules. They are simple and impossible to follow for most. However, if you can incorporate them you will succeed in your investment goals in the long run. You most likely WILL NOT outperform the markets on the way up but you will not lose as much on the way down. This is important because it is much easier to replace a lost opportunity in investing – it is impossible to replace lost capital.

As an investor, it is simply your job to step away from your “emotions” for a moment and look objectively at the market around you. Is it currently dominated by “greed” or “fear?” Your long-term returns will depend greatly not only on how you answer that question, but how you manage the inherent risk.

 
 

“The investor’s chief problem – and even his worst enemy – is likely to be himself.” – Benjamin Graham

 

Merkel victory in German state election

Plenty of politics in the early part of the forex week

French election, of course,
  • French election results, official counts coming now 
  • Macron wins French election – EUR higher (early price indications)
  • French election results – Le Pen concedes defeat
And, in Germany –
An election in the German state of Schleswig-Holstein:
  • Chancellor Merkel’s conservative party won, her  Christian Democrats on 33-odd % of the vote (initial result)
  • The Social Democrats had been in power, but only won 26.5%
Polls had been predicting a much tighter result, so an outperformance by Merkel’s party here
And, while your here, rates update:

Overnight US Market :Dow zooms to close up 257 points.S&P 500 + 24 Points

U.S. stocks held up remarkably well and jumped Wednesday as the major indexes pared steep losses after markets careened out of control in volatile trading overnight after a speech by U.S. President Elect Donald Trump helped reassure investors after his upset win vs. Hillary Clintoncaught investors around the globe by surprise.

The Dow Jones industrial average ended up 257 points, or 1.4%, after tumbling as much as 800 points in late-night futures trading. The blue chips are now 46 points and a fraction from an all-time record closing high.

The broad Standard & Poor’s 500 stock index, which was down 5% overnight and hit a trading halt designed to limit losses, erased its steep declines and climbed 1.1%. The Nasdaq composite also gained 1.2%.

Theories on why the initial market backlash to Trump’s shocking win has given way to stock market gains are starting to roll out. U.K. firm Capital Economics cited a few key reasons:

•  The market reaction from Brexit in June, a sharp drop followed by a rebound set a precedent.

•  Trump’s “gracious” acceptance speech “encouraged hopes that he will moderate his more extreme positions.”

•  Despite a GOP sweep of the White House and Congress, checks and balances remain due to Trump’s differences with “fiscally conservative” Republicans.

•  The economic backdrop is “generally improving” and supportive of assets.

Abe’s stimulus plan experiencing headline inflation of its own

Japanese Prime Minister Shinzo Abe’s government is putting pressure on the fiscally conservative Ministry of Finance to satisfy expectations for a bold new shot of the first arrow of Abenomics — fiscal spending.

But critics say that the contents of the stimulus package matter more than its apparent size, which is easy to inflate. Some observers now see the tally rising to between 20 trillion yen and 30 trillion yen ($189 billion and $283 billion) after off-budget items are counted. 

 The chairman of business lobby Keidanren, Sadayuki Sakakibara, is among those urging “large-scale” on-budget expenditures, he told an audience in Nagano Prefecture on Thursday.

The trial balloon floated by the Finance Ministry missed expectations. There had been talk in the financial markets and elsewhere that general-account budget items alone — known as mamizu, or “fresh water,” in Japanese government jargon — would amount to 5 trillion yen to 10 trillion yen. Then came the revelation that flagging tax revenue growth and other constraints would leave less than 1 trillion yen available for stimulus.

The Rise Of The Right: French Nationalists Hunt, Beat Muslims-VIDEO

The day after the disaster in Paris, Marine Le Pen – leader of France’s right-wing ‘Front Nationale’ party – called for the nation to “re-arm itself” and “eradicate” radical Islam, warning the French people that they are “no longer safe.” So, it is hardly surprising that the inevitable fall-out from this ultra-nationalist commentary has resulted in Frenc citizens taking their own protection into their own hands…

As the following clip shows, French ‘patriots’ are hunting Muslims in Paris…

Spain, Portugal sought to trip up gov’t, Tsipras says

Leftist Prime Minister Alexis Tsipras on Saturday accused governments in Spain and Portugal of working with the conservative opposition at home in a bid to weaken, or even topple, his anti-austerity administration.

Addressing SYRIZA’s central committee on Saturday, Tsipras said that Madrid and Lisbon officials had sided against Athens during negotiations on February 20 that led to a four-month extension of the country’s loan deal.

“We were up against an axis of powers led by Spain and Portugal, which for obvious political reasons sought to lead the whole negotiation to the brink,” Tsipras said.

“Their plan was, and it remains, to wear down, topple or bring our government to unconditional surrender before our work starts to yield fruit and before the Greek example affects other countries,” he said. Both Mediterranean countries will hold elections this year.

11 Biases That Affect Traders

Overconfidence
As the name suggested, it is the irrational faith in one’s skills, methodology or beliefs. For example, you see a certain chart pattern and make a maximum leveraged trade, even though you understand that any chart pattern cannot predict market with certainty. Trading excessively after a winning streak also shows overconfidence.

Cognitive Dissonance
It means finding excuses for something which makes you ‘uncomfortable’. For example, jumping from one indicator to another when you face losing trades; or continuing to trade in stock even your trading methodology does not gives you a positive expectancy. 

Availability Bias
It means being biased to information which is readily and easily available. For example, people begin to trade using RSI without understanding the internal relative strength; that is, RSI is most talked about on forums so start using them without rationally researching it. Being affected from attractive advertisement or intelligent sounding articles (including this one!) without due diligence also signifies availability bias.

Self-Attribution Bias
It means giving yourself unwarranted praise for outcomes which may just be an outcome of chance. For example, people make money in a bull market through buy and hold and start begin to believe on their trading acumen rather than the market regime which favors their trading style. Read More 

Nicolas Darvas

Great links with Nicolas Darvas interviews

“Since he has to do trading from wherever he is dancing he ignores tips, financial stories and brokers’ letters, and has never been in a broker’s office. Basically, his approach is that of a chartist: he watches price and volume … When a stock makes a good advance on strong volume, he begins watching it, buys when he feels that informed buyers are getting in. For example, when he was playing in Calcutta, he noticed E. L. Bruce moving up in the stock tables. Suddenly, on 35,000 shares it moved from 16 to 50. He bought in at 51, though he knew nothing about the company, and ‘I didn’t care what they made.’ (They make hardwood flooring.) He sold out at 171 six weeks later.

Darvas places his buy orders for levels that he considers breakout points on the upside. At the same time, he places a stop-loss sell order just below his buy order, so that if the stock does not move straight up after he buys, he will be sold out and his loss cut. ‘I have no ego in the stock market,’ he says. ‘If I make a mistake I admit it immediately and get out fast.’ Darvas thinks his system is the height of conservatism … If he has a big profit in a stock, he puts the stop-loss order just below the level at which a sliding stock should meet support. He bought Universal Controls at 18, sold it at 83 on the way down after it had hit 102.

Darvas trained for the market just as methodically as he had studied his dancing, read some 200 books on the market and the great speculators, spent eight hours a day until saturated. Two of the books he rereads almost every week: Humphrey Neill’s Tape Reading and Market Tactics and G. M. Loeb’s The Battle for Investment Survival. He still spends about two hours a day on his stock tables.”

That line, “[He] buys when he feels that informed buyers are getting in,” made me chuckle. It should read “He buys when he suspects that uninformed fools are piling in.”

An Interview With Nicolas Darvas in 1974:

Don’t forget I too went through a period of learning from 1953 to 1958 where I lost a substantial amount of capital before I worked out what worked and then was lucky enough to time it in the 1958-1960 bull market.”