Hello All,
I will not be blogging more than once or twice a week until I get done with my finals. I thought this would be a great article to share for info. They more concerned you become with your money, the more you will realize you will do these without even knowing you are knowing you are doing it. I had no formal schooling in Finance or Economics when I began learning Money/ Cash management. Which is also when I knew I was a autodidact (http://en.wikipedia.org/wiki/Autodidacticism) It is important to build a mote (from Warren Buffet) around you household income and financial security, an impassible mote around a business model and a financial/capital structure that is impenetrable, is what most investors look into before deciding to invest. My main point is to invest in yourself and treat yourself and finances like a business. Would anyone want to invest in you? Would they be long or short you ? Always examine yourself and fix your weaknesses (that are controllable by you.)
http://finance.yahoo.com/news/best-ways-invest-5-000-180003687.html
Happy Easter
Kelvin Brown
p.s. anybody would was paying attention we made a killing on the AAPL short over 300% return
Sunday, April 20, 2014
Tuesday, April 8, 2014
Week Out
I am sorry I will not be posting this week due to being overloaded with school and registration. I am also having surgery for my deviated septum on Friday. I will be pr-op planning most of the week. I may be down another week, but we will see.
Regards,
KB
Saturday, April 5, 2014
U.S. Armed Forces - We Must Fight - President Reagan (HD) 2014
This is a true American hero and I can't a wait for another POTUS
New Google Plus Profile Link
https://plus.google.com/u/0/106119793957992388054/postshttps://plus.google.com/u/0/106119793957992388054/posts
Friday, April 4, 2014
Credit Default Swap and the Fall of the Housing Market
http://en.wikipedia.org/wiki/Michael_Burry
Here is another guy to follow, he went from being a doctor at his residency to being a Hedge Fund Manager. He continued to beat the market year over year. His credit default swap (buying insurance on bonds backed by Investment banks and sold to investors as bonds, made him billions when the market crashed, had it not he would just be out the premiums on the insurance he bought, he predicted the crash correctly and made a hell of lot of money). This is how I realized how it all works without all the financial lingo, basically he bought insurance on a car that was not his (bonds backed by mortgages) and paid his monthly insurance premiums on your car(monthly insurance rates, he was paying a million a mth). He would bet that you would wreck your car and if you didn't the bank or insurance company makes the premium, all good right. But what if the insurance company thinks you are a great driver and will never wreck your car and he thinks it is inevitable you will wreck your car and you are a bad driver. As soon as you wreck it he collects whatever sum he bought the insurance for and agreed with the bank to receive. this is a credit default swap. The issuers of these credit default swaps were some of the worlds major banks like goldman and lehman brothers. They though their mortgage backed bonds were awesome and they enjoyed receiving a million dollar a month from Mr. Burry. The mortgages were no doc and faulty, soon to be foreclosed on. They would have waitresses making 50k a year buying 450K homes with an ARM mortgage not a fixed rate with very low interest rates, Well here comes 2008 and those loans made in 03-05 are beginning to default AKA (the mortgage meltdown or crisis) This sent the market tumbling and almost destroying many major investment banks (it did bankrupt Lehman). Mr. Burry collected his insurance on these defaulting loans and now was a billionaire, as were most of his clients. I am telling you this because don't always believe and conventional wisdom. If you have a gut feeling or know something isn't right, ask a professional or someone you trust with this knowledge what your are thinking and why. Finance is an art, not a science. Uncertainty in the market can make a chart look like a heart rate monitor.
If you want the whole story, and this book is awesome you probably won't be able to put it down. "The Big Short" is a tell all about credit default swaps and who got rich, who got fired, and went bankrupt because of them. Its funny because be fore Michael Burry approached the investment banks about this idea, there was no such thing as a credit default swap, he essentially created them in partnership with the investment banks and based on the investors and major managers greed
Well,
I just wanted to share this and question feel free to ask.
This is his blog.
http://michaelburryblog.blogspot.com
and here is his bio
http://en.wikipedia.org/wiki/Michael_Burry
Here is another guy to follow, he went from being a doctor at his residency to being a Hedge Fund Manager. He continued to beat the market year over year. His credit default swap (buying insurance on bonds backed by Investment banks and sold to investors as bonds, made him billions when the market crashed, had it not he would just be out the premiums on the insurance he bought, he predicted the crash correctly and made a hell of lot of money). This is how I realized how it all works without all the financial lingo, basically he bought insurance on a car that was not his (bonds backed by mortgages) and paid his monthly insurance premiums on your car(monthly insurance rates, he was paying a million a mth). He would bet that you would wreck your car and if you didn't the bank or insurance company makes the premium, all good right. But what if the insurance company thinks you are a great driver and will never wreck your car and he thinks it is inevitable you will wreck your car and you are a bad driver. As soon as you wreck it he collects whatever sum he bought the insurance for and agreed with the bank to receive. this is a credit default swap. The issuers of these credit default swaps were some of the worlds major banks like goldman and lehman brothers. They though their mortgage backed bonds were awesome and they enjoyed receiving a million dollar a month from Mr. Burry. The mortgages were no doc and faulty, soon to be foreclosed on. They would have waitresses making 50k a year buying 450K homes with an ARM mortgage not a fixed rate with very low interest rates, Well here comes 2008 and those loans made in 03-05 are beginning to default AKA (the mortgage meltdown or crisis) This sent the market tumbling and almost destroying many major investment banks (it did bankrupt Lehman). Mr. Burry collected his insurance on these defaulting loans and now was a billionaire, as were most of his clients. I am telling you this because don't always believe and conventional wisdom. If you have a gut feeling or know something isn't right, ask a professional or someone you trust with this knowledge what your are thinking and why. Finance is an art, not a science. Uncertainty in the market can make a chart look like a heart rate monitor.
If you want the whole story, and this book is awesome you probably won't be able to put it down. "The Big Short" is a tell all about credit default swaps and who got rich, who got fired, and went bankrupt because of them. Its funny because be fore Michael Burry approached the investment banks about this idea, there was no such thing as a credit default swap, he essentially created them in partnership with the investment banks and based on the investors and major managers greed
Well,
I just wanted to share this and question feel free to ask.
This is his blog.
http://michaelburryblog.blogspot.com
and here is his bio
http://en.wikipedia.org/wiki/Michael_Burry
Thursday, April 3, 2014
Todays Outlook Post Close
Looks like things turned out for at least today as I predicted. If you read my article and saw the positions I created April 2nd. Today was awesome for me. I shorted (put options)( I want the price to go down) Apple and FB, they both fell with FB falling enormously. This would be a huge gain.. NKE it seems like it may take a little longer for it to bounce back. I made my options so short of time because of time constraints. I will not do this for future articles. I see Nike being around 76 when I close my options on April 18. Gold was slightly off the mark as I suspected based on trend analysis. I have already been shorting this with my own money since March at $78 now trading at 88. I short it thru GLL an ultrashort gold. XRX or Xerox which I Bought a call option(I want the price to go up) is doing as expected and I plan to exercise my option around 13.50-14.00. Also in my article I mentioned going long on oil futures for May. I quoted the april 1 price of 99.63. Looks like this is in my favor today also at 100.33. I hope it stays this way (not for you who have to drive long ways everyday) for this short period of time as I suspect. I am not going to mention why I chose these because it is in my paper I already posted. I hope tomorrow is as good as today or better.
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