Gold Eagle post is critical of the Stool

[Yoshaviah]

Here is a recent post from the Gold-Eagle Froum about the Capital Stool website:

 

@SeattleSun

(smsc) Aug 29, 13:56

 

That is quoted from Mark2Market - the only reason to visit capital stool, except the gold forum.

 

If I may make a comment. Many people started visiting and joined that place just because they liked M2M so much.

 

I find I have done far better since being banished from that place and started visiting and posting at gold eagle.

 

The problem is that the CS site, boards and posters there have a severe bearish, Prechtarian and deflationary bias - which will lose you money and/or inhibit your profits in this phase - if you let the chatter affect you. Most people are far more susceptible to groupthink than they imagine, so be careful which group you hang with.

 

My thinking is that we get the 70's - chaos, inflation, fear, uncertainty and doubt. The SM and real estate will go sideways up and down, but not keep up with inflation. PMs, oil, gas, emerging commodity countries are the way to go.

 

It's not easy holding for the long term bull, while pruning deadwood and taking some profits in some overextended shares and buying pullbacks in good stocks which are ready to take off.

 

Nothing against the posters over there, but during a gold bull market, gold-eagle is the best place to be. Bullish long term, but acknowledging that overextensions lead to large corrections. I really don't see anything which is all that extended long term.

 

Anyway, I'm pretty new here so I don't know if commenting about other sites is against the rules. But DO be careful where you hang. This is the place.

 

 

[mjkst27]

SoxBear from prudentbear.com board has echoed similar views. And who's to say he's wrong? Look at a chart since 1930 - it's the story of rampant inflationism in the US. Which means that at every point along the way, debt outstanding is greater than it was the year before. Why does the system absolutely need to deflate now? Maybe we are all wet.

[Pee Brain]

i dont remember anyone getting banished for being contrary - doc even created a "boolish" thread. seems you get a warning for attacking someone and then you get some time off. personally, i dont miss anyone thats been banished. i do agree that goldstool is worth the price of admission all by itself.

 

i for one dont feel all wet - im just working my plan and i sleep well at night. this thing is gonna unwind, you cant borrow your way to prosperity.

[threadbare]

The simple truth is, most people use the term "inflation" in the wrong way. There won't be wage inflation as there was in the '70's, as Yobob correctly and constantly points out. How can there be, when so many people are being laid off and their wages are being cut?

 

The dollar will decline, making imports more expensive. Local services such as plumbing, home reno's etc... will drop in price, as new construction tails off. and tradespeople scramble.

 

Most stuff that is cheap today will become increasingly expensive in the near future, and vica versa.

 

The poster is wildly optimistic that this is a replay of the 70's. There is a deck of wildcards being tossed by chance and politics into the machinery of the economy. Aside from rising energy costs, what's coming will make 70's style stagflation look like pig heaven. It will be neither what you could call typically deflationary or inflationary. Those seeking to benefit by rooting around for trump cards in the wreckage will turn up nothing but jokers.

[Yoshaviah]

At this point I have an idea that will make 'ol Doc some money, but he will have to cut me in for at least a free membership before I explain it to him. I think that is what they are affraid of over at that "other" forum. They know what I know and now what I know could cost them some market share if I tell Doc what I know about what they are afraid the Doc will find out about. Did I say that right

[phatbubble]

I find I have done far better since being banished from that place

looks like revisionist woundlicking. i don't recall doc putting anyone on time out for anything other than being disrespectful.

 

so, yosh, what about that thing that you know that they think doc might not know about that you want to tell, uh, them, i mean him, so that he knows what they don't know he doesn't know, or....uh....well, anyway, i thought it was colonel mustard in the library with the vibrator. is that wrong?

[DrStool]

I love free publicity.

 

Mmmm, sour grapes, yummy.

[Goldilocks]

....

[constantpated]

Not having read the original post, I'm not able to fairly comment on the statements made in re Stool. However, I thought I'd take a moment to share a few questions going through my mind.

 

My questions:

 

- How has the profitability of the trader been improved with the new focus? Short term profits can be bait to believing in the "new paradigm" and "I don't need to worry about that" mindset.

 

- How has the trading style changed; and if the market turns, would this trading style need to be changed back to an old style that he may have generated after reading CS? Again, not knowing the trader-author, I'm in no position to assess whether the there is a new trading style; or whether the author is in a position to recognize that a new approach is needed, or that he is in a position to know when to shift from his new style to a style that needs to be tailored to a deflationary-bearish environment.

 

- How has the risk-mitigation strategy improved to handle the possibility of a sudden reversal? If the diversification has improved, and the risks decreased, excellent; however, if the results are through more narrow focus at the expense of risk mitigation, then I'm not convinced that the "new insight" is more secure.

 

- What is the basis to discount the deflationary concerns? I read nothing compelling that the concerns were invalid; only that the views were not matching with the current market direction [read = "sucker's rally"] Victory is not whether the current strategies are working, but whether the strategies are working and will continue to work in what is actually happening, and most likely to happen; manias do end.

 

- How does changing one's view/focus on the problem actually address the risks of deflation? I have no information on this.

 

- How have the lessons from CS in re technicals/cycles been factored into the trading style? The worst thing would be to not only reject the CS sentiment at what may be [tomorrow] a market top, but to reject the cycles and useful charting that goes into weighing the risks.

 

I'm all for going with what works [is that general enough?] but am cautious that something has been cast to the wind at the very time that the information may be most needed. It remains unclear to what extent the bearish sentiment has been rejected in practice not just words; how much has been embraced; and what truly will not work in any situation.

 

However, just as a horse on a trail knows there are ups and downs and twists and turns in the trail, so too are there unexpected twists that may not match the last ride. A fallen tree may block the path. Using the horse-trail analogy, if the horse [trader] is simply moving the blinders [information gathering] to "where he believes the trail [market] should be, and is moving his head [focus] to match where the view is most consistent with the movement of the trail [market], but not whether the trail [market] might unexpectedly change course.

 

At worst such a "relief of I'm away from the bears," simply is a warning that the unexpected is going to happen, yet the blinders [focus] is going to be where the trader hopes the trail [market] will take him, not where the trail [market] is actually going.

 

Thus, I wonder whether the real source of the "glad I'm gone from CS," is linked more to a "I'm glad I'm not longer reading bearish sentiment, because the market keeps rising." If this is the case, then I'm left to believe that this is yet another sign of a "market top," as that "I'm so comfortable feeling" as a nasty way of sneaking up just before a reversal.

 

Clearly, the purpose could be to publicly state that the site-poster interaction/nexus was not desirable or favorable. However, I am speculating that perhaps despite what appears to be some concern that "Stoolies are overly bearish-deflationist" [paraphrasing, possibly true, but another matter], the reaction of "not feeling welcome" may have something to do with "seeing the market go in a direction other than down."

 

In other words, despite the deflationary fears and bearish concerns regarding fundamentals, cashflows [etc], it seems as though some are caught in a quandary: The market is rising despite the continued collapse in cashflows. Thus, it would appears that someone who is "expecting an imminent crash" is not satisfied.

 

My theory is that the poster [again admitting ignorance on my part, for not having read the post or followed the poster] is that the comment may be related to feeling a disconnect between bearish sentiment and market direction.

 

Although a single datapoint [of an origin of unknown value, credibility, or reliability], one could use the "I'm glad I'm not a bear any more" attitude as a sign of a market top. [Again, I'm simplifying on the basis of the single sample size.]

 

More broadly, some of the thoughts that come to mind are related to what would compel someone to say, "I'm glad I've left"; if they were truly happy, would they not simply get on with their life, let go, and enjoy the positive. More bluntly, although I see that there may be some euphoria in having departed, I would wonder "How have the profit trading strategies either improved or been modified" after leaving CS?

 

It is clear that sometimes we need a break, and I'm glad that someone is clearly reading "other views" for this is the only way that I'm aware of this post. My point being: Maybe the person just needed some validation that despite the bearishness, the market could go up or in a favorable direction.

 

Also, I have yet to understand what the specific problems are with the deflationist-concerns. Again, having not read the post, I am not privy to what might be some valid concerns and criticisms with the view that we're entering a deflationary paradigm.

 

Although the person left CS, I cannot help but wonder, "Have they also stopped reading sites that discuss the issues,"? If that is the case, then although the person may have cut the cord on CS, I'm not convinced that simply leaving CS will necessarily insulate the person from the bearish sentiment on other sites.

 

It appears to be a disconnect to define "success" or "relief" in insulating oneself from a discussion website, without also insulating oneself from the news, discussion, and thoughts of other sites that are generating and sparking the thinking in CS.

 

In turn, if their "relief" is actually linked to "shutting off all the bearish news," then I'm wondering is the poster simply focusing only on favorable news that is matching the market direction. If that is the case, then that is not a trading strategy, nor a sign of discipline; rather it is simply moving the blinders to the location where the view is most reassuring.

[roidrage]

i for one dont feel all wet - im just working my plan and i sleep well at night.  this thing is gonna unwind, you cant borrow your way to prosperity.

Pee - Beautiful. I think this is the sentiment that Glad is endorsing every morning on IDS. Plan your trade, trade your plan, make the world a better place! The first two seem easy when one starts considering the third.

 

I love this aspect of the CStool perspective.

[Guest yobob1]

i dont remember anyone getting banished for being contrary - doc even created a "boolish" thread. seems you get a warning for attacking someone and then you get some time off. personally, i dont miss anyone thats been banished. i do agree that goldstool is worth the price of admission all by itself.

 

i for one dont feel all wet - im just working my plan and i sleep well at night. this thing is gonna unwind, you cant borrow your way to prosperity.

Right Arm bro!

 

For me, it's been tough staying focused on the path, what with the boolish bent and chatter around here for the last few months........quite the opposite of what whoever describes in their Gold-Eagle post. This too will change.

 

It's been tough listenning to all of those who say the 4 year cycle has passed, look how we match the Nikkei and will continue to do so, the fed will give us a stick save, etc. This is all based on past patterns. Yet at the same time, in the past, booms of anywhere near this size have all had matching busts that took the markets back to at least their starting points, which in our case would be about DOW 1000. This is ignored. Selective rememberance, I guess.

 

Truly though this boom and subsequent manipulation and feed (incl. other foreign CB's) pumping in a total fiat global environment has no parallel in history. We are in uncharted hungry shark infested waters in a ship that has water lapping at the feet of the deck chairs. The boilers are nearly out, providing just enough power to keep the lights on (unless you live in the East of course ) ) and the steering is broken beyond repair.

 

When I first started boring other people with my views 3.5 years ago, one of my biggest fears in how this would all play out was that the govt. and the fed would "intervene" and make a very bad situation into an unimaginably bad situation. My worst fears have come true, in that aspect. Had they not we would have had a very nasty sharp correction that by now would have mostly run it's course, allowing for a renewal of the business cycle and a temporary stay of the Hypertiger scenario. Alas it is not to be. The intervention (giving a shipload of booze to the alcoholics) has now assured us of the biggest bust in history when it let's go. The boom, the bust, the over population, the depletion of resources (potable water and oil), the hedonistic life styles of the populace, abandonment of thrift, mass corruption at every level of society, and the government blazing new trails of Imperialism, all point to the end of the plateau phase of a multi-century or perhaps multi-millenia cycle. It ought to be a doozie when the wheels fall off.

[Hiding Bear]

Hard core bears, yes many including myself. Deflationist? Not sure what that

meant here, certainly most Stoolies are quite boolish on gold and some appear to very well informed on even small miners.

 

There is a strong possibility of debt deflation, if that what was meant. I even think M3 growth is temporarily leveling off. But the reason I am very boolish on gold is the reaction/intervention I expect from government in reagards to these "deflationary" developments.

 

Yoshaviah and others here, keep up your fine economic analysis!