Pet Peeves

in general, i don’t hate anything in this world, as any phrase or thing is created with a purpose; however, i have collected a few of them here … sometimes i wish people didn’t say or do what they said/did, mainly because they say something, as an escape clause, and not in the right context or true meaning … below here is a collection of those things:

1.  “markets go up & down” although this phrase is a fact, i really don’t like when people use it casually, because most people use this phrase as an escape clause just to make themselves happy, when they are screwed by their own investment decisions, & i wish they would rather say, “i don’t have a clue why market is going up or down” as this version implies that they take responsibility for their own screw ups, accepting human limitations, which will help them make smarter investment decisions in future, and not blaming the market.

2. where the market will be at a point in time in future (say end of year) ..?

there is another answer to this question in Humans/Fin Decisions page, but this is also one of my pet peeves; & people ask this question do so innocently, i.e. they have no clue what the meaning if the question & this is me- an INTP-  talking, so here we go:

i assume you know that market is a discounting mechanism; i.e. it discounts future outcomes like earnings/dividends into present … first, we make up the future, and then discount it to present to arrive where the market should be today?   & it seems strange to me that no one ask this question, where the market should be today, as everyone seems to know the answer looking at their smart phone .. which tells you where the market is today & not where it should be? rather everyone wants to know where the market will be at a point in future … let’s see how can we answer the question.

in order to find where the market will be, say in “near future,” you need to project the earnings and dividends in “distant future” … i.e. the future of the future .. that’s when we go into futures market ..! hope, you got the point(s):

1) i don’t think most people realize the meaning of the question itself that they are asking about a futures market, when most of them don’t trade in futures ..!

2) it is so hard to project [near] future and its exponentially hard to project distant future which is based on near future, & i am not sure if it could be a part of casual conversation that where the market will be in future ? 

hence my favorite pet peeve.

3. when people compare stocks, bonds & cash long-term returns, using as an argument to invest in stocks regardless of market situation.

it is simply a fact that over long-term stocks provide higher return than bonds which in turn provide higher return than cash as the investors expect a higher return for taking additional risk (e.g. buying stocks over cash)  … but, it should not and can not be used as an argument to make a case for buying stocks at a point in time without using market situation in a context .. i.e. some people use this argument even when many others think that market is close to a peak, say Jan 2000, when NASDAQ just returned about 50% in 1999 … rather, the purchase of stocks at any point should be based on whether they are under-priced or over-priced based on current market situation, and future expectations in a given time period, and not using a standard argument that stocks are simply better than cash … for example, say a market based index provides 10% over long-term versus money market provides 2%; however, if stocks are over-priced currently, then in an year, your stock portfolio may be down 20%, while cash still stays at 100% plus some interest.

4.  machines generate extra volume creating volatility and bringing price under fair value

some really smart people in financial industry blame computers for taking markets down, & i think its absurd … first of all nothing happens without a reason, & whatever machines do in terms of trading, it requires hell of funds to make it happen; so it is definitely based on some reasoning & it’s not a joke to do machine trading, as you need serious capital … if you think machines bring price under fair value, why not buy something, and make a ton  …  machine simply provide you better liquidity especially for commonly used instruments like S&P index ETFs, options & futures; people have been blaming machines since the Oct 87 crash … yes, machines generate extra volume on a volatile day, but they also add the volume & boost price on an up day (remember 1000 points rise in DOW on the day after Xmas 2018) – i have never heard anyone complaining on an up day that machines did a bad job taking the market up … its based on the fact that human behavior is asymmetric towards up verses down market, which is hard to realize ..!

5.  “a 60/40 bonds/stocks portfolio (i.e. diversification) will protect you in down market”

& i say, really ..! … yes,  the 60/40 portfolio is provides a zero return in initial down market instead of going into losses (as in Aug 2019), but isn’t a better option to get zero or slight positive return is to hold in cash .. by investing in a 60/40 portfolio, we take two risks (interest rates as well as market) and hope that they will cancel each other .. & what IF they diverge … as, hope is not a strategy ..!

& then they say that you need to take profits from diversification when appropriate, so my question to these smart folks: is diversification an investor or a trader’s strategy ..? 

You are asking an investor to time a transaction .. really ..!

6.  this is a stock picker’s market  & not a market of stocks ..!

one of the BS on WS; typically used by folks who charge you commissions; & you can’t compare them to anything as there are no benchmarks for stock pickers; everyone is unique to suite your unique situation .. right? what a BS ..!

BL: stocks and market are built on each other; market exist because of stocks and is a collection of stocks; & stock exist because they are part of a market.

7. in a down market, a typically hear “fundamentals are intact”… [Aug 2019] 

global rates are falling because growth is slowing down & you say that fundamentals are intact ..  lol … simply based on when you calculate price based on last quarter’s earnings & a lofty multiple used this year so far .. & both of these  data points are fixed but based on past and not future … & yes,  everything looks good in rear mirror as you are not going to hit that care .. you only need to worry about the one in front.

8. “on WallStreet the consensus estimate of something is this …!” [Oct 2023] 

anytime in hear the word consensus in context of WallStreet in media, i replace it with “crap” – one of my favorite words; imagine there are twenty students in a a Math/Logic/Critical Reasoning class, where each student gets a different answer to a problem … & the teacher says, “class – i am going to use the consensus to give you a grade” … you can make the rest of the story, as to how stupid will that be?

9. “you need to put your money somewhere …” & justify stocks based on this argument  [Sep 2019] 

it really hurts me listening to this line, used frequently by so called expert money managers, which is absolutely bizarre, especially in a toppy market .. as last time, i checked, it doesn’t hurt putting money under the mattress & is a much better option than losing money in stock market ..!

10. in financial media, folks talk about an average value of VIX (also known as fear gauge) 

calculating/using an average of VIX also known as fear gauge, doesn’t make sense at all .. although an average can be calculated for any variable that has a set of values; but taking an average of emotions is meaningless; say yesterday was one of the best day of your life like got an offer letter of your dream job, and today was one of really bad days like you had  some sort of accident, and then someone tells you that taking the average of last two days, you must feel normal  .. & you would say, what the ..? 

looking differently, calculating an average of VIX / volatility is like taking an average of a sine wave [as an analogy] – which is ZERO as per its nature … a sine wave is supposed to move around a baseline giving an average value as zero – which is its characteristics, but saying that a sine wave has an average value zero provides no additional information about the wave .. rather a specific wave is measured in terms of amplitude, frequency & phase .. & so should the fear index.

 11.  the odds in a given situation are 50-50  ..!

yes, people use this phrase all the time; sometime, just to show their understanding of the situation … but the point is .. 50-50 is same as “I have no clue;” whether the outcome is head or tail … its actually a meaningless statement … but do they mean that ? … that i am making a meaningless statement, as using the right phrase will put you in a different category.

12. I am not “…”, but i am going to say this “….”

an example of this would be, typically in financial media, someone will say, I am not an economist, but i am going to say this … & I say, why bother, IF you are not an economist, can’t you keep your mouth shut ..?

13. for people around me: first know what you know and then be decisive .. make a decision with confidence based on what you know now … i don’t have much tolerance for indecisive nature .. i listen to smart & decisive people, as i get along with them & go “long” with their thinking to make money .. i can also handle stupids and idiots, as i go “short” with their thinking & make more money .. but i don’t like to be with indecisive or confused (or those who pretend to be confused).

these [confused & indecisive] people typically start their sentence as “i don’t know … pause” .. followed by my challenge ..”what it is that you don’t know? ” ..  response ..  “dead silence!” .. i.e. they don’t even know, what they don’t know .. these people only talk at their leisure, with no action; never make decisions on-time and then cry over spill milk for the rest of their lives, remember .. “The roads are paved with flat squirrels who couldn’t make a decision ..!”​​

additionally, i particularly don’t care if you lie or speak truth to me; either way, it better be logical [to you first] that you can convince me to make sense based on logic; given a situation, a truth vs lie is relative; plus its depends on what you know vs what you don’t, but it better be logical.

14. “I believe …”  this is the most common and ambiguous phrase used in English language to start a sentence … practically, you can go in any meeting or on a media outlet and start saying anything with “I believe …”  & it may mean either 

1) I know, or 

2) i don’t know, or 

3) here is my guess, or 

4) here is my opinion etc. 

so it leaves the audience to anticipate its meaning … in fact, if you notice its spelling carefully it is spelled as BE-LIE-VE, which may give you an indication for its purpose.

OTOH, I think the phrase should be used in rare situations like describing your dreams or imaginations , as i tell folks when you dream big – tell me your biggest lie (start your sentence with I be-lie-ve) & spend rest of your life proving that you are right [about that biggest lie].

15. “how things happens in USA versus India ?”  …  i don’t like when people compare two countries, especially out of context e.g. as each has its own distinct qualities & history; therefore, a comparison is meaningless … there is no comparison between state of law & order, economy, labor productivity, quality of life etc. between the two countries and it is mainly because of each country’s age/life; therefore, the current state of the two countries and definitely not related to people … & if there needs to be a comparison, it needs to like this, think of West coast of America which is about 167 years old (in 2017), versus east coast which is about 353 years old (counting since New York’s sale by the Dutch) … in comparison Europe is 2,000 years and India is 5,000+ years … think about it.

16. “Veganism is good for animals ..?”   a number of people in west are turning vegan, which is a good thing, but their thought process behind this decision is upside down .. when people ask me the question, why i am vegetarian ..? my reply is that i am a lifelong vegetarian (it is who i am) & i am because it’s good for me; that’s how we have lived for generations & i never had a need to change; OTOH, people, who turned vegan, act & behave like activists who are following this movement to save animals & want others to do the same & in process they end up not liking people who are not vegan .. this behavior doesn’t jive with me … being vegan or vegetarian is a choice that an individual should make if it’s good for him/her.