A Canadian on Wall Street

An excellent blog from someone who I think might be an investor in Microsoft. His latest post is indicative of the tone of the website and highlights Steve Ballmer’s continuing inability to figure out current directions in technology.

Obviously, I haven’t been much in the mood to write here, and there’s good reason. Although I’ve been putting money into the market occasionally, I’m still mostly in cash (much of it American dollars, fortunately or unfortunately), and I really have no specific strategies. I’ve gone back to hunch and feel, which in my mind is as effect as any empirical, hyper-analytical system, provided you have enough experience with the market.

That said, it seems to me that both equities and the real estate market here are not particularly great places to invest these days. There’s low returns and although some people think there’s also equivalently low risk, I think the irony is that the times when there are low returns can often be at times when there are also the highest risks, as people keep chasing returns and driving prices up, increasing precariousness. It’s had me casting out a little, to wonder at what areas outside of these two markets are available to invest in. I’ve looked at intrade.com, put some play money to work there (I bought some Segolene Royale contracts cheap, and may sell them in the day or so prior to the French election) to see what it was like, but I suspect it doesn’t have the volume, at least in areas I’d feel proficient or at least interested in — nothing bores me more than US politics and the horseshow that are the primaries. It’d kind of wild to read about some guy who clears $500-1000 a day on these markets and who quit his professional futures trader job to do that — is that really possible? I suppose it’s a little like those guys who decided to play poker online as a fulltime job and succeeded, but look what happened to that area. It’s doubtful that’s a sustainable lifestyle, especially as information and skill propagate through. Although, in my mind, skill’s benefits are negligible after a certain point in any of these markets with limited information. It’s access to information that is important — whether skill can allow someone to acquire additional information, either directly or indirectly, is where skill still plays a factor.

The other thing I’ve been vaguely looking at is investing in someone’s business directly, which has consequently higher risks and rewards than the average equity, but it’s something over which I’d hope to have a lot more control. Or maybe not. But I like the idea, and if I saw a business plan that made sense to me, I’d jump in.