Martenson: The Coming Rout

[Sidewinder]

Re: Martenson: The Coming Rout

OK, Itulipers. It doesn't look good - my thesis is about to be invalidated. Without going into the details, the market has proven me wrong, and I'm going to take the egg on the face.



You got that right.

as jneal3 said

+1

[coolhand]

Re: Martenson: The Coming Rout

I have first hand information about the state of the crisis at the stricken reactor site. The situation is not good. The scenario I told readers about yesterday is that four of the reactors ultimately melt down.

The hysteria here in the US can be explained by the fact that less than 10% of Americans have a passport, and 5% of those who have one have used it in the past year. I doubt half the folks rushing to stock up on food in response to stories about radioactive contamination on the US west coast from the stricken Japanese reactors even know how to find Japan on a map.

I'll be in Hong Kong and Taiwan over the next two weeks, starting tomorrow. I'll be upwind from Japan, as the radioactive plume heads away from me over the Pacific Ocean, and reporting what I hear for subscribers shortly.

EJ - I'd love to hear an update on this. If your initial take that 4 of the reactors ultimately melt down;

then I combine that with what i've been told by a Ukrainian friend that lived near Chernobyl & whose family still does, which is that NOTHING grows near Chernobyl - no humans, no animals, no plants, nothing - just dirt;

then I combine that with estimates of 25% of GDP or more for Japan coming from the greater Tokyo region, which would be downwind from 4 melted down reactors depending on prevailing winds;

then I combine that with my own intuition that many/most people are like me in that on matters such as this, they won't bet their health & more importantly the health of their children & loved ones that the gov't will tell them truth about the long term health risks of living what the gov't deems "a safe distance" from as many as 4 melted down reactors;

then I combine that with the thought that if the above is true, greater Tokyo real estate, which 20 years ago was worth multiples upon multiples of the total value of California & therefore is likely still carried at quite high values on bank balance sheets...

...and I come up with the thought that Japan's GDP is going to be handicapped for a lot more than months, & their bank balance sheets (and those of others with large outstanding loans to Japanese corporations & land owners in the region) are in very bad shape for a long time to come...

...which ultimately seems highly inflationary - cuz you either do nothing & collapse, or print money to pay for reconstruction...

any thoughts? Thx!

[lektrode]

Re: Martenson: The Coming Rout

EJ - I'd love to hear an update on this. If your initial take that 4 of the reactors ultimately melt down;

apparently he's enroute eastbound from narita = lots of timezones to BOS, so might be a day or 2

then I combine that with the thought that if the above is true, greater Tokyo real estate, which 20 years ago was worth multiples upon multiples of the total value of California & therefore is likely still carried at quite high values on bank balance sheets...
...
......which ultimately seems highly inflationary - cuz you either do nothing & collapse, or print money to pay for reconstruction...

the headline/quote with comparisons in them daze that eye recall was something like: "the land beneath tokyo alone was worth more than the entire continental US, including texas"

now _thats_ a bubble that, apparently, still hasnt fully deflated?... so i guess the question becomes: will the bernank's bet (with the value of OUR money) be correct "in the long run" and how much short term pain will this cause us mere mortal workin stiffs as the price of virtually everything (cept houses) kranks up, up, up..... and.... AWAAAAAAAAY.....
as much as i'm getting more nervous about this by the week, theres something in the back of my head that keeps dragging up 1980: http://www.safehaven.com/article/513...-spike-of-1980

TRUE MONEY SUPPLY

[Minion]

Re: Martenson: The Coming Rout

Greetings, IT'ers.....

Check this out. I should have looked at the momentum before...

Serious divergence in macd and rsi, breakout has retraced, and a macd failure to reach its upper trend line opens the door to the lower price channel being breached.

Eggs on the face or not..... I love this stuff.

I dedicate this picture to any other technical traders who wish to reflect on that beacon of human nature, the market, and the picture it paints....

dia.JPG

Disclosure.... I'm stalking long puts on various names, AA being the first.

[unlucky]

Re: Martenson: The Coming Rout

Perhaps your approach suffered from "data-snooping" bias, a common pitfall when back-testing quantitative strategies?
When you test using any particular set of historical data, there are lots of strategies that are profitable with the selected data set - but only by chance. You might want to check out Ernie Chan's website for a discussion of this and other pitfalls of quantitative trading, he has a discussion of back-testing here. In general his advice is to first develop a hypothesis based on economic or other knowledge, and use back-testing to verify/reject the hypothesis. Never use back-testing alone to develop a strategy. If a set of historical data is used to refine or tune a strategy, then other independent data sets must be used to verify it.