9 replies to this topic

[da_cheif]

Time to retire Wall Street vet of 64 years has seen it all, but says 2008 unprecedented By Marshall Loeb, MarketWatch Last update: 7:24 p.m. EST Dec. 8, 2008 (MarketWatch) -- Arthur Gray, a smooth and dapper man, has worked on Wall Street for 64 years, which makes him one of the most experienced traders in America's investment community. Through profitable booms and painful busts, he thought he had seen it all. But that was before he saw the pillage and madness of 2008. "We're living in unprecedented times," he says. "There's never been anything like this." And, he adds, these are not the kind of times to risk investing large parts of your portfolio. So he is following the advice of the late, legendary trader, Bernard Baruch, who is credited with saying, "nobody ever went broke selling out too soon." On Friday, Arthur Gray, at age 86, will pack his bags and submit his resignation as a senior managing director at Carret Asset Management. "The main reason I'm doing this," says Gray, "is that as I look ahead, there doesn't seem to be real opportunity in the investment environment for years." That is quite a concession for a man who has earned money by the ton in investments for nearly two-thirds of a century. Sure, he says, there will be rallies in the years ahead, but they will be of 1,000 points or less on the Dow. Traders will make money on them, but they will be very short term -- some lasting only half a month or half a week. In order to take advantage of these rallies, he advises, stay very liquid and be defensive. Safety first He is putting fully 75% of his assets into cash and 25% into a mix of cash and short-term securities, which he figures he can use to plunge into and out of the brief rallies. The basic reason for caution, he warns, is that problems confronting the world are more basic and profound than many of us think. "It has been estimated that there are $700 trillion derivatives of all kinds out there," he says. "That's 10 times the world's total gross domestic product. Also, there has been a real shrinkage in the world's capital." He figures that the whole world will be in an economic slowdown for five years, although Europe will be hit harder than the U.S. because its problems -- such as declining population -- are much tougher to overcome. Surveying this scene and casting an experienced eye forward, Arthur Gray says, "I've always been a long-term investor -- until today." "Now I'm a sold out bull."

[hiker]

Don, you think I should close out my ES swing short before January? it is not a small position.

Edited by hiker, 26 December 2008 - 04:00 PM.

[da_cheif]

if you got long in the 700.s in the mar sp...u gotta nice enuff cushion to relax and let it ride.....if ur long from above 800 i can understand ur delima....so essentially you gotta sych urself out by saying what would i do if i had got long at 737......u see its a mind game ....like golf.........for simplicity i would hold on till investors intel got to 60% bulls......then tighten up the stops.....all off course imho

[Tor]

Cheif, did you read my last post to you??? I guess not, so below it is again. Its not my job to advise you, but if this market bounces into January/Feb, then keep shorting it to oblivion, as one by one corporate america is going to start imploding. Its a degree of Japan over again, so I would say BE CAREFUL IF BEING A BULL. The credit bubble built up over the past 18 years will take a longer period than most predict, to unwind. Good luck pal. Cheif, good to hear you. Try to imagine a world where a bull market has ended in an epic move, in March 2000. Whereafter the prices and the inevitable was postponed though the release of net wealth in the housing market, which then popped and left untold levels of excess inventory. Think about a world where the Japanese students and policymakers are well versed in the various stimulation programmes through monetart anf fiscal spending, yet, in a post bubble envornment nothing can be done to purge the exxcesses except for businesses to fail, restructure rebuild their balance sheets and let individuals do the same. Japan is still at it even now, zero rates, cash injections, yet the money just sits in the banks, because people realise they have to start paying off those credit card and personal debts. In turn they breed a population of savers, not spenders. Then overlay a chart of the dow jones with the Nikkie dow at the peak, and see if you notice any similarities. If the US manages to reverse then all the good, but to my eyes there is nothing new on wall street, and it has all been seen before, through fractals, trendines, consumer spending patterns, booming populations and declining ones, and the rise and falls of empires. This is how I am seeing things here FWIW. Think big picture, rather than trading bounce is my personal viewpoint.

[Tor]

if you got long in the 700.s in the mar sp...u gotta nice enuff cushion to relax and let it ride.....if ur long from above 800 i can understand ur delima....so essentially you gotta sych urself out by saying what would i do if i had got long at 737......u see its a mind game ....like golf.........for simplicity i would hold on till investors intel got to 60% bulls......then tighten up the stops.....all off course imho

Cheif...open your eyes to the baby boomer cycle.

Its being wound up pal.

Right now, its Fear and greed, if fear dominates we go down a lot more, if greed then we go up a lot.

Its a confidence thing. I think ironically you actually want people bullish, not the fade as times gone by.

Good luck.

[nimblebear]

well that old geezer is spot on about one thing. That $700 trillion in derivatives. we aint seen nuttin yet as far as carnage.

[Tor]

if you got long in the 700.s in the mar sp...u gotta nice enuff cushion to relax and let it ride.....if ur long from above 800 i can understand ur delima....so essentially you gotta sych urself out by saying what would i do if i had got long at 737......u see its a mind game ....like golf.........for simplicity i would hold on till investors intel got to 60% bulls......then tighten up the stops.....all off course imho

cheif, you misread hikers post....he said he is SHORT.....not LONG.

JUST thought i would mention this to you.

[vitaminm]

Arthur Gray, a smooth and dapper man, has worked on Wall Street for 64 years, which makes him one of the most experienced traders in America's investment community............................ .....when did he learn about online chart trading?

[pdx5]

well that old geezer is spot on about one thing. That $700 trillion in derivatives. we aint seen nuttin yet as far as carnage.

That $700 Trillion.....how does he arrive at that number when it is not required to be declared?

Also, assuming that bubble goes pooof the players who will get hurt will be Madodff type investors...greedy
for yield and returns.

[gman]

cheif, you misread hikers post....he said he is SHORT.....not LONG.

JUST thought i would mention this to you.

Tor, I believe what da Cheif is talking about is that he is long the big contract from somewhere in the 700's and that he uses the e-mini for shorter term "short trades" along the way. His sacrifice to the bull gods as he likes to say.

Edited by gman, 27 December 2008 - 12:58 AM.