I am often asked, “why offer comment on anything when all you have to do is follow the trend?” Famed technical trader Richard Russell was asked that recently too:
“Russell, you say that the news of the day has little or nothing to do with the market, and that the stock market itself is its own best forecaster. If so, then why do you write about anything but market action?”
“Good question. I write about news, ideas, history, the War, poetry, religion, jazz, dogs, my own life, health concepts, thoughts, all with the goal of keeping myself (and hopefully, my subscribers) interested. The world includes a great deal besides the markets, and I think about those other items. Maybe I should call my writing, “Richard Russell’s Daily Blurbs” or something like that. At any rate, I just keep writing about what interests me, and I guess that includes just about everything.”
I see it similar to Russell. For example, understanding trend following and doing it are two different things. Exploring assorted insights to help people ‘dial in’ and ‘get it’ — is fun for me. Additionally, I enjoy nailing the government. The notion that suits in D.C. should micromanage our lives, when they seemingly have no clue, is insane. Pointing that out is also fun for me.
What will you not find here?
You won’t find me professing a bull market on Monday and a bear market on Wednesday. You won’t find me giving you some fundamental baloney about where the market is headed based on some treasure trove of useless economic data. That stuff is mental masturbation.
But still not everyone agrees with the idea of trying to write about the trend space — even friends. A trend trader, who I think does nice work, wrote me other day summing up nicely why he thinks even talking about trend following is pointless:
1. It is a great threat to the fundamentalist financial establishment so they will do everything possible to not cover trend following and prohibit by any means necessary it’s promulgation.
2. Many investors trade for ego satisfaction and/or thrills and will not follow the enforced discipline of a mechanical trading method.
3. Investors are obsessed with trying to buy at bottoms and sell at tops which trend following not only does not do, but finds that attempt to be a losing proposition.
He has a point!