Thursday, June 28, 2018

For the strong hands out there

Based on this metric, Bitcoin is reaching valuations almost 2 SD below its mean.

As always, I am a steady buyer.

Time horizon long.
My faith in crypto is strong.
Outcome could be wrong.

How'd you like my haiku?

I made it rhyme as well, as a testament to my linguistic prowess.

The question for me isn't if I should be buying now - the signs mostly point to yes.

The question for me is HOW MUCH I should be buying now to maximize my returns. It's always good to remember that cheap can get cheaper, and buying cheaper is better for returns.

I suppose the least wrong answer is just to average out my buys over objectively cheap periods like this.

2018 portfolio rekt, perhaps.

2019 portfolio rich, hopefully.

As always, time will time.

Tuesday, June 26, 2018

The State of the Crypto Markets Jun 18

Oh, how far we have fallen from the sun.

BTC is sitting at ~$6.2k and ETH at ~$450.

On the bright side, my leveraged long position at $377 is still in profits and I'm overall still in profits.

well not super sick profits like before, but c'est la vie

So this bear market has been pretty brutal, especially to all the new guys and to all the "ICO flippers". There's a reason why I'm mega selective on my ICO positions. I try to play defensive instead of offensive. Crypto is so naturally high risk anyway that just playing defensive is good enough for me.

My technical analysis (which is pretty shit) that I did a few months ago has been pointing to a bottom in Aug / Sep.

Recently, I have been studying the long and short interest in Bitcoin and I've come to conclude that we're likely to have at least another dump - there are too many people who are still very long in the crypto space. Being contrarian has it merits, because it helps you understand long and short positionings and their meanings quite well. When short interest was peaking 3 days ago, I was certain that we'd see a short squeeze and we went up quite quickly from the $5.8k range. But longs still remain, so there leaves a lot of cleansing left to happen in the space.

My updated view has got a rough bottom at late Sep / Oct. It might be the final bottom, or it might actually be a higher low, I've no idea, but that's what my hocus pocus magic meme lines are telling me. I don't use them with high conviction, so neither should you.

On the bright side, this bear market has been fantastic for the crypto space, the remaining players and the projects.

All the "get rich quick" people have rage quit and left after being wiped out on margin, the non-believers are selling now or will finish exiting their final positions on the next bounce, but the people who are still left will be promoted to sergeants in the next bull run with plenty of men (fodder) to keep them safe for the next battle, and the promotion that comes with it.

When I entered crypto, I almost immediately experienced my first bear market. In June 2017, ETH tanked from $400 to $140 in 35 days, lol. That's a face ripping -65% first month, lol.

In Sep, the markets tanked another 40%, but by this time I had made enough smart moves and knew what to do that my portfolio barely bled. On the worst day I think I briefly peeked into single digit negative for just a few moments, only to be rocketed back into the green within the next hour.

Coming into 2018, the markets were exuberant and now everything has fallen from grace. Most cryptos are down 70-90%. I'm down, but not as much. Call it luck, portfolio allocation, portfolio selection, trading strategies and arbitrage profit buffers, but I am not down that bad. The best part of all is that I'm still in profits. This crash has wiped out a chunk of my unrealized fairy magical profits, but my portfolio today, mark to market, is still in profits. How much profits, I shall decline to give a number. But it's still comfy. At least, for now.

The morale of that story is that the first bear market I encountered, I was facing a 65% loss. The second bear market, 0% was the worst day I had to deal with. With this being the third major one that I am dealing with, even on shitty days like this, I am still in profit.

Guess what will happen to the fourth bear market that I will face?

The fifth? The sixth?

I expect this bear market to probably be the last ever bear market that I will personally be affected and slightly stressed out about. For the guys out there facing this as their first, sucks to be you but that's the price we pay to be in crazy markets like this. I've already paid my "dues" by suffering in the previous bear markets, all with much less morale support by the smaller crypto community back then. Now there are personalities pumping out videos, articles and bites everyday with decent quality to them. It's a lot easier psychologically with the amount of community support now. Actually, I hope that to some of you, I am a pillar of support.

Once you've graduated from this bear market, hopefully the next one that you face, your capital wont even be affected, and the one after that, you're still in profits even in the darkest of days.

Aqua, the godess of uselessness blesses you

Projects are starting to panic because they've realized that value-less pumpy and hype news is not going to cut it and give their tokens sustained value. Useless crypto are fast seeing their values completely sucked out of them, and investors are getting wiser to what exactly they are buying into when they buy a token.

Is it a tokenized donation receipt to a private company? Is it a pre-payment for their yet-to-be-built serivces? Is it a security? Is it valuable? Will other people want to buy this from me?

People blame ICOs for being greedy and raising lots of money with stupid tokens. I disagree.
I blame investors for being greedy and handing over lots of money for stupid tokens.

The onus is on you not to be an idiot.

On the flip side, good projects are hunkered down and making lots of headway in this depressed markets. Stupid projects "hold back news" so that they can release them for maximum "pumpability" of their token price. Good projects release news when they have something to report, and continue building and making progress. Why? Because they know that the value of their project doesn't come from pumpy announcements, but from building projects that people will actually use because they see value to it.

With this bear market, I've had more time to think about a lot of things and I think this has been a good time to refocus my knowledge and understanding of things so that during the next period of excitement, I stay focused and on the right path.

Holding steady and continuing to buy the dip with fiat is not a problem with me because I truly and deeply understand the technology and the world that I am buying into. I don't have to convince you about it now. I am convinced and that is enough for me.

You can take your own time to be convinced and finally see the light, but maybe by then the crypto markets would be many multiples higher.

By the way, if you really don't believe in crypto, you should quickly capitulate so that we can cleanse the market and set up for the next bull run, haha.

Stay safe out there guys. With the markets doing so badly and everyone looking towards internet strangers for comfort, I wouldn't be surprised that scammers are getting more and more desperate.

Oh, I haven't updated my $50,000 goal yet. Currently I'm standing at 2%, but I've pretty much almost secured another 4% over the next 3 weeks. And I've also secured another source of profits that is like to push me about 4-8% closer to my goal in Aug. I'm pretty confident to say that by end of Aug I'd definitely have $5,000, or 10% in the bag. $50,000 is an ambitious goal, but it's a fun one to try and reach for. I'd still be happy with the outcome, no matter how much I fall short, haha.

Saturday, June 23, 2018

Preparing myself for the Japanese Discount

It's strange, but I quite enjoy reading the stuff put out by the research guys by Stansberry Churchouse. Their recent article is about the precarious demographics that Japan is facing.

Perhaps the reason why I enjoy a lot of their articles is because we tend to approach the some topic, but I get to see someone else's perspective.


I have talked about Japan's structural demographic issues and their policies to address it before, in Sep 2015 and Dec 2014. Fast forward to 2018 and what do we have? BOJ still printing money to push up asset prices, and are now owning 80% of eligible ETFs.

Do I have to explain again why debt isn't good for countries? Well, if you're not planning to pay altogether, then you've got a great deal lol.

I'm certain that in my lifetime Japan will have an event that will really shake up their status quo. I'm not specifically trying to target Japan, I'm a financial asshole and I wish for hell on the global financial markets. It is just that for me, Japan is very clearly going down a very dangerous path for their country.

Personally, I like Japan a lot. You can see how much fun I had in Japan for a week for just $1.4k.

One of my fantasies is to have an apartment in one of the major cities downtown and spend 1-2 months a year escaping the SG heat and enjoying being somewhere else (I realize, CNY is an excellent time because the Japanese don't celebrate CNY and the weather is still nice and cool). Well, the new Japanese rental laws changed, maybe I can rent out the apartment for half a year, then leave it empty and visit during the other half? Mmm, one of the things on my to-do list should think about how I can make this fantasy idea into a reality in the future. Japanese real estate are all freehold too, if I'm not wrong. I wouldn't mind to pick up a 1 or 2 bedder Japanese apartment should Japan hit a wall economically.

Anyone with experience or info regarding direct purchasing of Japanese residential property?


Wednesday, June 20, 2018

Blinded by Yield

I think in Singapore, one of the most popular investing styles is income investing, mostly through dividend paying stocks and REITs, supplemented with retail bonds.

To be honest, it is a strategy that I myself is quite fond of.

Kyith wrote an excellent piece about HY dividend stocks and some ways to think about them. I think it's a great read, especially for people whose analysis consists of only looking at the headline dividend yield number.

Business profits could drop.
Dividend payouts could drop.
Demand for higher yield could increase, price would drop.

Some people might think that fixed income investments might be better, since the payouts can't drop. That is true - to an extent. Payouts could just be cancelled and stopped altogether, ala Hyflux style. Worst still, the principal could just be defaulted on. So are bonds are safe? It really depends which one. This is an example of an extremely unsafe bond.

Almost 3 years ago, I was analyzing Telcos, which are known to be steady dividend payers.

Singtel has gone from 4.03 to 3.16. (minus 22%)
M1 has gone from 3.19 to 1.54. (minus 52%)
Starhub has gone from 4.00 to 1.54. (minus 62%)

Even counting in the dividends paid out over that period, things are not pretty.

Previously when I was focused on SGX, I did invest in M1 and I cut my losses at 19%. I cut losses with Starhub at 5%.

Anyway, I'm just saying don't be too caught up in the yield numbers because earnings don't expand perpetually.

It's easy for me to comment freely since I no longer own any stocks, but I think chasing high yield numbers is one of the most sure way to die. Ask the people that chased Sabana, HPH, APTV and the infamous Rickmers.

If the yield is really so irresistible, why isn't everyone else buying it and bringing the yield down? There must be a really good reason.

Betting on attractive yields relative to its own historical yields is a better approach, in my opinion. Not every REIT is the same, and to just select them based on raw yields alone is really too basic and doesn't take into account the unique characteristics of each REIT. I'd do the same for P/NAV, and then look for the good stuff which have been irrationally swept up in the mess that is affecting everyone.

Anyway, this is just my observation as a bystander. I think so many markets are crazily overvalued. And this is true within the crypto markets as well. It's madness the valuations that some projects are getting.

If everything goes to shit, I might honestly decide to de-risk my portfolio and move some of my wealth back into traditional yield stocks. Yes, buying depressed assets at firesale prices is a low risk move, not a high-risk one.

By the way, I'm positioned for a global financial meltdown, so yeah, I'm kind of biased.

Tuesday, June 19, 2018

PSA: Argentina will NEVER repay their century bond

Source: Wolfstreet

Wolf Ritcher wrote a nice piece on this. Will just copy my favourite bits here. (For reference, the bonds were sold at 90 cents on the dollar)

So don’t cry for Argentina’s investors that inexplicably bought $2.75 billion of 100-year bonds with a 7.125% coupon in June last year, at the peak of the cheap dollar-debt benightedness. 
Everyone knew that Argentina would default on these bonds before they’d mature, as it has defaulted repeatedly on its foreign-currency debts, and that it was only a question of when it would default and how many times. 
But the lure was just too juicy to not bite, in an environment where central-bank shenanigans (NIRP) were producing negative bond yields in Europe and Japan. And even in the US, ZIRP was still not fully banished. In the ensuing pandemic chase for yield, which had lasted years, investor brains were systematically starved of oxygen.
The thing is, Argentina hasn’t even defaulted on it yet, though 11 months after selling the bonds, it has already gone begging to the IMF for a bailout. And the IMF, in another bout of debt-benightedness, has agreed to lend it $50 billion. But those $50 billion won’t be used to pay off the century bond. They’ll be plowed into government spending and will disappear, leaving Argentina with an additional $50 billion in dollar-debt.
It’s not crazy for Argentina to have undertaken this piece of 100-year gaucho showmanship – in fact, you have to admire it for being able to pull it off. But it’s crazy for investors to have fallen for it. 
But now investors, including the hot money, are once again getting burned in the emerging markets, and the emerging markets are once again getting burned by their exodus. You’d think someone might have remembered that from the last few times it happened. But no. These old sins are repeated endlessly.

You couldn't see this happening? It's a freaking trainwreck in action slowed down frame by frame so you can watch it implode beautifully over this 100 years.

Don't say I didn't say. I said it twice, in May 18 and Jun 17. Before the IMF bailout, but after they raised interest rates to 40%, lol.

I ain't even worried about sticking my neck out for this one.

Clear as day for me about what WILL happen. It's not a question of "if", it's just a question of "when". This is inevitable.

I just need to be right once over the next 99 years. I've got history on my side as well, since Argentina has already defaulted 8 times since 1827 and never got past 63 years without a default. Lol, easy bet.

Remember, your masters would like to remind you that sovereign bonds are the safest things ever.


Oh, since I'm on a related topic.


What could possibly go wrong?

Be safe out there. If you won't look after your own money, no one else will.

Saturday, June 16, 2018

Quick Updates

Crypto markets are dropping and I'm busy wearing my helmet catching falling knives.

Lots of interesting progress are being made on the tech front. Lots of trash also raising obscene amounts of money.

I'm rather busy doing a few personal crypto projects.

Things ought to be quiet on my front for a bit while I busy myself making money.

I shall report back triumphantly about my endeavours as I'm done with each of them.

One week on and I'm already at 1% of my $50,000 goal. Steady as she goes.

$500 in a week from clicking here and there, best sidejob ever lol. Also, it's been a slow week. Things ought to pick up next week, heh.

Thursday, June 14, 2018

Things You Could Never Imagine

"I'm watching Donald Trump, the current President of the United States meeting with North Korean leader Kim Jung Un for a peace treaty in Singapore, on CNN with commentary from Dennis Rodman wearing a marijuana ICO cryptocurrency t-shirt."

Never thought that this is real life eh?

Well, it is, lol.

Sunday, June 10, 2018

Random Sunday Crypto Musings

Ethereum is deliberating about lowering Casper staking from 1500 ETH (~$1.2 million SGD) to just 32 ETH in Casper + Sharding (~$25,000).

Owning a sharding validator might be like owning an apartment building in NYC.

I'm psyched to run an ETH sharding validator and have passive income while helping to protect and secure the blockchain that I am using.

Apparently though, there are concerns about centralization because it means that non-validating nodes are unable to reject blocks.

I see where he is coming from, but I disagree.

Right now I run 0 Ethereum nodes.

If Casper + Sharding requires just 32 ETH, I'll be running as many as I can. More than a handful, hur hur.

I believe there if this is the case, there would be thousands of nodes coming online. Let's see if I'm right.

There have been an increase in the "protocol" thesis lately and I'm just gobsmacked by how many people think some random platform is going to usurp the current market leader. I think Ethereum is both undervalued and its competitors are extremely overvalued. This is a rather good piece that highlights some points that I've been repeating over and over again.

I'm skeptical of other platforms, but I'm not an ETH loyalist. I just go with the flow. If a competitor can prove to be a serious one, I'd gladly reconsider my current position and update myself with the new facts and think about changing allegiance, or at least hedging my bets.

There is currently nothing I'm worried about.

This of course might change in the future.

Everyone flocking into all these new protocols really just make me shake my head. This comic sums it up well.

Crypto is getting a bit more quiet with all the moontards badly burnt and having left the space.

Projects have all STFU since they aren't breaking new ATHs and and ducking down to avoid pissed off moontard investors and are working hard to pump out their project to make it deserve a valuation.

Personally, I am eagerly awaiting the launch of Havven's nUSD. I have raved about it before. Let's see if I become rich or get rekt.

I recently took part in an ICO and now I am waiting for another ICO to finalize it's token sale terms. Other than that, all is quite quiet on the crypto front for me.

Well, other than arbitrage of course. I'm getting rather good at farming free money. I wonder how long its going to last. Since my positions are rather fixed, I have decided to utilize my idle capital to continue my arbitrage trades. The downside is that they aren't in my cold wallets and at a slight risk of any exchange black swan event.

Oh well, no risk, no reward, amirite?

I'm going to give myself a loose target and aim to make $50,000 from arbitrage between now and the end of the year. I think I might be able to do it. Let's see how it goes. Just a fun experiment for myself.

Stay safe in crypto lads. See you on the front lines.

Saturday, June 9, 2018

Police Can Legally Steal Your Money (in the US)

"A 64-year-old Cleveland man is suing U.S. Customs and Border Protection after agents strip-searched him at an airport in October and took more than $58,000 in cash from him without charging him with any crime, according to a federal lawsuit filed this week in Ohio. 
Customs agents seized the money through a process known as civil asset forfeiture, a law enforcement technique that allows authorities to take cash and property from people who are never convicted or even charged with a crime. The practice is widespread at the federal level. In 2017, federal authorities seized more than $2 billion in assets from people, a net loss similar in size to annual losses from residential burglaries in the United States."

If you thought the country you were living in is some backwater bullshit of a country, let me introduce you to the fantastic U S of freaking A.

Civil asset forfeiture is a long known problem.

It's a big problem.

And nobody likes talking about it because 90% of people can barely even believe that it exists.

I have a tiny device that helps me securely store "digital funny money" that I can access for anywhere in the world as long as there is internet.

And if I lose it? I can just buy another device and generate my access keys to my cryptocurrency and all is well again.

The use case of cryptocurrencies to avoid this kind of wrongful seizure of your OWN money is glaringly obvious.

You don't need to trust the government will not be screwed up. With cryptocurrency, you don't even give them the chance. For all intensive purposes, even if they do know how much cryptocurrency you have, they ain't ever getting it from you, except through torture. And in which case, you're living in a screwed up country already. All the best living in that regime. I hope you manage to escape.

I've enough money to give me a decent start wherever I decide to plunk myself at, if I ever chose to do so. It's not that I want to do it, but it's the absolute knowledge knowing that I can.

I am free.

Wednesday, June 6, 2018

Bitmex CEO Podcast

Really really good podcast by the CEO of the biggest Bitcoin exchange by volume who was previously a banker in Hong Kong.

Yes, Bitmex. The exchange that allows you to go X100 on a position, to unleash your true degen form.

This is a podcast where I found myself nodding in agreement regarding how simple trading strategies that have been completely eliminated in the traditional world still works extremely well in the crypto space. The past month I've made over 10 ETH manually arbing by executing by hand - so I can confirm that this is true. Obviously, opportunities like that will narrow and disappear as the space matures.

In the tail end part of the podcast, he talks about government issued digital currencies and I find his view to be extremely similar to mine - where crypto runs parallel as an alternative to crypto-fiat, instead of total replacement. Hence, my personal bias towards censorship-resistance and privacy to counter the surveillance and restriction of movement issues that will be coming.

His take on most current ICOs being "total dogshit" is same as mine - I am extremely selective for the ICOs that I personally take part in. I have also been echoing the view that the current shift of most ICO allocations being swallowed up by VCs doing SAFTs will get them rekt. I really detest the way that a lot of projects are going about with their ICOs recently.

This is one of the best podcasts that I've heard and it reinforces a lot of my views. Maybe mid month I can push out and share a post to be just in time for a nice mid year recap with all the knowledge I've been accumulating so far.

Tuesday, June 5, 2018

Those Damn Digital Tulips

"Initial coin offerings (ICOs), sales of cryptocurrency tokens to the general public, have recently been used as a source of crowdfunding for startups in the technology and blockchain industries. 
Even after imputing returns of -100% to ICOs that don’t list their tokens within 60 days and adjusting for the returns of the asset class, the representative ICO investor earns 82%."

Worth the risk?

That's a question for you to ask yourself.


Academic paper.

Nuff said.

Sunday, June 3, 2018