Blog Archives:

Check Out This Guy’s $47,000 Lunch Bill [PICTURE]

Posted by Timothy Sykes on Sat 7th of Nov, 2009 08:45:51 AM

Just the latest example of how rich people can do pretty stupid things, but it doesn’t matter because they can afford it. Don’t you wish you were one of those people? Well, my strategy ain’t gonna help you become a billionaire, the average TIMalert subscribers is up only $1,812 in 2009, but if you learn from my instructional DVD packages, especially my new ones, they can help you earn enough to pay for $47 or even $470 lunches (I’ll have to make 100 instructional DVD packages to help you learn to earn $47,000)

Or you could just be like this student of mine who is up $90,000+ using my strategy

Thanks to TMZ for digging up the dirt:

Check out the bill:
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Wall Street Movie Sequel News: Carey Mulligan, The Actress Playing Gordon Gekko’s Daughter

Posted by Timothy Sykes on Thu 22nd of Oct, 2009 07:40:10 AM

Filming in NYC this month and a film I’m excited to see, I’ve written about the ‘Wall Street’ sequel several times.

Below are pics of an up and coming actress who is reported to be playing Gordon Gekko’s daughter…I don’t want to influence your thoughts one way or another so let’s see what you think, will she fit the role?:
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Bonus Entourage Video Clip With Matt Damon & Vince [VIDEO]

Posted by Timothy Sykes on Sun 18th of Oct, 2009 09:45:30 AM

The rather above average TV show had its series finale on HBO a few weeks ago, but thanks my following Jeremy Piven (Ari Gold) on twitter (you can follow me too!), I just found a cool new bonus video clip that apparently 600,000 or so other people saw before me.

Better late than never, good way to start off a Sunday morning, funny stuff:
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Wall Street Movie Sequel Early Photos Less than Inspiring [PICTURES]

Posted by Timothy Sykes on Thu 15th of Oct, 2009 07:40:38 AM

Remember: Wall Street movies can be entertaining, or just really boring, but there’s nothing better than making nice sums of cash as TIMalert subscribers have earned in excess of $750,000+ in 2009. Watch LiveStock live tomorrow 1-2PM EST, or on demand at any time afterwards, and learn to make some $ off financial corruption

I dunno, either I’m just a highly successful short seller who likes to rip on everything or the photos below from the set of Wall Street 2: Money Never Sleeps just don’t do it for me.

Gekko looks like a old worn out bitch…and thanks to this Daily Mail article, we know he spent 14 years in prison for insider trading and securities fraud, LOL….that’s just silly, Gekko would’ve had an amazing lawyer and would’ve paid a hefty fine, but that’s about it….14 years, LOL, I doubt Madoff will even get that many!

And Shia, oh man, this kid, what can you say about that outfit…alright enough negativity from me, you decide for yourselves:
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Bernie Madoff Wins First Prison Fight (Seriously)

Posted by Timothy Sykes on Wed 14th of Oct, 2009 07:40:50 AM

REMEMBER: You have until this coming Friday, October 16th, to register to attend this special event. from the comfort of your very own home or if you can’t make it live buying that 2-day pass will serve as your order for the DVD of the event, which will be 12+ hours of footage and come with an instruction manual too!.

That is The NY Post is to be believed, and their track record is a little spotty–correctly nailing SpongeTech Delivery Systems Inc. (SPNG) but choosing the wrong side in the fight of Trader Monthly (which later went bankrupt BEFORE the market crash…a feat that could only be accomplished by Randall “The Sick Twisted Son Of A Bitch” Lane) vs. little old me.

But here’s an eyewitness sketch of the incident:
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Now This Movie Just Looks Plain Awesome [5-Minute Exclusive VIDEO]

Posted by Timothy Sykes on Sun 11th of Oct, 2009 08:35:01 AM

I blogged about this movie once before when the initial teaser debuted, but now we have an exclusive 5-minutes of footage that proves just how good/funny this Roland Emmerich disaster movie ‘2012′ is gonna be.

Special effects sure have come a long way since Emmerich’s ‘Independence Day’ and ‘The Day After Tomorrow’…stay tuned to see the whole thing in just about a month when it premieres on November 13th

(I kinda look at as a perfect analogy to Wall Street…I am John Cusack and TIMalert subscribers are my family…I will protect you guys at all costs even as actors charading as governors (stock promoters) feed you misinformation and lies because it’s their paid-for-with-bribes duty to do so)

Check it out:
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My Meeting With Donald Trump’s Hair At The US Open [PICTURES]

Posted by Timothy Sykes on Mon 14th of Sep, 2009 07:45:28 AM

You know I saw the whole Serena Williams blowup & SpongeTech Delivery systems, Inc. (SPNG)’s continued attempt to lure in financially ignorant sports fans at the US Open the other day, but check out who was sitting one row in front of me at yesterday’s matches (yup, PennyStocking is the new real estate):
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What Did Serena Williams Say At The US Open? [VIDEO]

Posted by Timothy Sykes on Sun 13th of Sep, 2009 12:13:38 AM

I had the pleasure of attending the US Open today, catching this great shot of one of the many sponsors, Spongetech Delivery Systems, Inc. (SPNG), which the US Open should have READ THIS BLOG POST on before allowing a BLATANT PUMP & DUMP TO ADVERTISE THEIR CRAP TO MILLIONS OF UNSUSPECTING & FINANCIALLY IGNORANT WORLDWIDE TENNIS FANS (anybody who bought this pump during the first half of the Open is currently down 50% within a few days as recent press releases have exposed these scumbags) (and mind you I have no position, my TIMalert subscribers and I made a 35% gain last time this company’s skeletons caught up with their stock, but now I just like rubbing it in how right I have been all along) (after all, I do create instructional DVD packages teaching people how to profit from blatant pump & dumps like SPNG)

I bring this up because what everyone’s talking about is Serena Williams blowing her lid (like a bitter long-term penny stock investor) RIGHT INTO FRONT OF THE SPONGETECH ADVERTISEMENT. It’s not Serena’s fault, it’s Spongetech’s!
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Does Bernie Madoff Have Cancer?

Posted by Timothy Sykes on Tue 25th of Aug, 2009 08:10:56 AM

Only people with too much time on their hands actually care (stop reading this post now and start studying these guides I’ve created for people just like you), but the NY Post certainly thinks so, but like an ignorant penny stock promoter, their word means exactly shit…after all, you gotta remember this article in which they took the now defunct Trader Monthly’s side over me and made me look like the retard that editor-in-thief-turned-nobody Randall Lane actually is.

Ah well, you gotta love gossip, check it:
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The Interesting Story Of Fred Franzia & Two Buck Chuck

Posted by Timothy Sykes on Sat 22nd of Aug, 2009 09:30:20 AM

The New Yorker published THIS interesting piece a months back…it’s not so much a story for wine lovers as it is for entrepreneurs and startups, really good stuff:
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A Great Wall Street Short Story…

Posted by Timothy Sykes on Sat 8th of Aug, 2009 09:30:01 AM

Todd Harrison, founder of Minyanville.com, is one of the few financial commentators worth reading…as you can see his bio is impressive:

Todd Harrison, founder and CEO of Minyanville, has eighteen years of experience on Wall Street. After graduating from Syracuse University with honors (1991), he spent seven years on the worldwide equity derivative desk at Morgan Stanley (vice president).

In 1997, he became a managing director of derivatives at The Galleon Group. Three years later, he joined $400 million hedge fund Cramer, Berkowitz as partner (head of trading) and was President from January 2001 until January 2003.

And the cool thing is he’s willing to share a lot of his Wall Street experiences with an 18-part e-book…I like them so much, I just gotta paste the individual articles two at a time (see originals broken up HERE and HERE) below:

Chapter 1: Inmates in the Asylum

It was the turn of the century and change was afoot.

As Y2K fears swept the Street and the stock market scaled the wall of worry, Wall Street was flush with newfound wealth and irrational exuberance.

It was an exciting time to be a trader as money magically meandered overhead like some sort of magic carpet ride. If you weren’t cutting a rug, you were missing out. And everyone from taxi drivers to stay-at-home moms were wearing dancing shoes.

I was already a veteran of my chosen profession, having honed my skills at Morgan Stanley (MS) for seven years before managing the derivative portfolio at a multi-billion dollar New York hedge fund.

At 30 years old, some said I achieved a level of accomplishment in a world filled with grizzly old timers. But there was plenty to do and more to make, a self-serving motivation that drove me to the next best trade.

I knew Jim Cramer and Jeff Berkowitz for many years, having covered their hedge fund while climbing the corporate ladder at Morgan Stanley. I respected them both, as people and professionals, and we established a symbiotic relationship over time.

We swapped ideas, shared insights and traded billions of dollars worth of stock, blazing separate yet similar paths. It was a period of discovery and unbeknownst to us at the time, it was the genesis of a relationship that forever changed our lives.

As 1999 drew to a close, our circles began to overlap with increased frequency. I was ready to take the next step in my career and Cramer Berkowitz was ready to transform its trading desk from an execution platform to a legitimate revenue generator.

They already had the intellectual capital in house and the performance to prove it. Our imminent marriage would lift us to the next level and establish our fund as a force to be reckoned with.

The courtship was seamless as we took the necessary steps to consummate the relationship; I would join the firm as a partner and run the entire trading operation. I asked for full autonomy on staffing decisions, commission direction and risk management systems. Each and every request was granted.

As we uncorked several bottles at Gramercy Tavern, the deal was struck with hugs and handshakes. The trading operation would be mine to mold and after ten years on the Street, I finally had an operation to put my fingerprints on. I tendered my resignation at The Galleon Group and took the first cab I could find to 40 Fulton Street.

I was hungry yet humble, excited yet nervous, enthusiastic yet measured.

The existing traders had been with Cramer Berkowitz for years, executing the vision and vibes of Jim, Jeff and research director Matt Jacobs. I was schooled a bit differently and believed the trading process could be additive and accretive to profits derived solely from the research functionality.

I assumed my position at the head of the desk and committed myself to quietly observe the people who would become my professional family for the next three years.

But as I would quickly learn, my role at Cramer Berkowitz would be far from quiet and anything but normal.

Just the way I like it.

The Purpose of the Journey is the Journey Itself

I didn’t always want to be a trader. In fact, it’s a small miracle I found my way to Wall Street and beyond.

I struggled whether to share this story as I didn’t know if anyone would be interested in my lot in life. As I weaved my way through the many mazes in my mind, I decided to put pen to paper and recount my steps.

If not for you, for me, but with a larger lens on the immediate gratification conspicuously consumptive society we lived in. Some might say I bowed to the false idolatry of money and perhaps I did. I was conditioned to believe that success was measured by a bottom line and validation could be found in a bank account.

Everything you’re about to read is true, as seen through my eyes. I share it without vice or virtue and with all due humility. Lou Manheim said in the movie Wall Street, “Man looks in the abyss, there’s nothing staring back at him. At that moment, man finds his character. And that is what keeps him out of the abyss.”

I’ve stared into a few black holes during my career and emerged each time with newfound passion and incremental resolve. The ability to turn obstacles into opportunities is one of life’s best-kept secrets and the greatest wisdom is bred as a function of pain.

As with any journey, the path we take is more important than the destination we arrive at. My particular route included climbing the corporate ladder and chasing the trappings of success. Once I got to where I thought I wanted to be, I realized net worth and self-worth were entirely different dynamics.

That was distinctly different than what I was programmed to believe as a child and it facilitated a professional and spiritual rebirthing. In life, as with the markets, the big picture is made up of many smaller pictures.

To fully appreciate where I was, we must first understand how I got there.

Bagel Boy

My parents divorced when I was three years old. Looking back, their marriage was doomed from the start, a fast-tracked union facilitated by the Vietnam War during a time of extreme geopolitical uncertainty.

We moved from New Jersey to Great Neck, Long Island and lived in a small apartment overlooking a park. My brother and I shared a room and adapted to life without a father. Our mom took a job in Manhattan and her income allowed us to enjoy a solid middle-class existence.

We lived in an affluent town, though we weren’t in the wealthiest of neighborhoods. Great Neck was a place where children measured each other by the logo on their shoes and labels on their shirts. That was my first taste of money, having some, but seemingly never having enough.

When I visited friends on the other side of town, I marveled at the sprawling lawns and fancy cars. I asked my mother why we lived with such modest means, unaware of how painful it must have been for a single parent with two young boys to field such questions. Her response was always the same—“If you want more money, get a job.”

It was the single best piece of advice she ever gave me.

At the age of 13, I began working at the local bagel shop. I awoke at 5:00 AM on Saturdays to prepare for the mad rush of customers, many of whom were the families I aspired to emulate.

I never forgot the symbolism of that counter, a divide representing the chasm between the “haves” and “have nots” as money changed hands for goods and services. Little did I know that I would experience life on both sides of that cash register.

Coming of Age

My father moved to California and our interaction was limited to infrequent visits and occasional summers. I used to stare at the phone on my birthday waiting for it to ring, looking for a semblance of normalcy or an inkling of paternal acceptance. It rarely, if ever, did.

My dissatisfaction manifested in many ways. I gained weight, got into fights and lashed out at whoever got in my way. I was the child who looked for validation at the bottom of a milkshake and acted out to get attention.

My mother had the foresight to harness my aggression and guide me towards sports as a positive outlet. I excelled as an athlete and thought I finally arrived and conquered my demons. How wrong I was.

High School is a vicious place, particularly in Long Island where you’re measured by possession. My self-esteem was fragile as a function of my father’s abandonment but I continued on a productive path. I held several jobs, following the advice of my mother that if I wanted to get ahead, I had to work for it.

My grandfather Ruby was my best friend but the void left in my father’s wake was powerful. I began to communicate with him to understand why he left and how I played a role in it. I decided to find out what the man was all about and moved to Woodland Hills, California at the beginning of my junior year of high school.

My father’s energy vacillated from one day to the next. Every encounter was random—one moment we were tossing a baseball, trying to recapture lost time and the next, I tiptoed through the house because he was so angry I didn’t want him to hear me. I thought he was moody but would find out years later that something entirely more disturbing was afoot, something beyond his control.

He worked as a post-production executive and seemingly found his calling. One evening, he pulled into our driveway in a flashy red Ferrari and announced he had been promoted. I’ll never forget how much he loved that car—he washed, waxed and incessantly detailed it as if it, alone, was symbolic of his success. I would witness that stretch for status many times over when I eventually arrived on Wall Street.

I also bought a car, a red Nissan 200SX, as I was anxious to emulate him. My father co-signed the loan with the understanding that I would be responsible for the monthly payments. I worked several jobs to make ends meet. On weekends, I traveled to Simi Valley and picked weeds for $50 per day. My mother’s advice played often in my head. “If you want money—get a job.”

I missed playing sports but was willing to make the sacrifice if it meant having wheels. California was a lot different than New York and if you didn’t have a car, you were socially disadvantaged. It simply wasn’t an option.

One night, my father walked into my room and said he was fired from his job and sold the Ferrari. He told me he needed my car to go on interviews but I still had to make the payments. If I didn’t like it, he said, I could move back to Great Neck. I agreed to help, hoping to help him get back on track.

When I graduated high school in 1987, I returned to the east coast and worked as a short-order cook in Times Square. I watched the well-dressed professionals as they paid their way and rushed to work while rarely, if ever, making eye contact. As I readied for a fresh start in upstate New York, it was hard to contain my excitement.

My lone goal was to be on the other side of the cash register.

R.P.

Chapter 2: Animal House

I walked on to the Syracuse University campus knowing nobody but excited for a fresh start. There were a few familiar faces from Great Neck but no one I would consider a friend. That changed the opening day of school when I attended my first class.

Sociology 101 was held in Maxwell Auditorium in a fishbowl-style classroom. I was on a work-study program and made a commitment to myself that I was going to take my studies seriously.

As I sat in my first college class, my eyes drifted toward the shaggy-haired kid with a Zeta Psi hat sitting in front of me drawing a picture-perfect Tasmanian Devil. “That has to be traced,” I offered as we gathered our books. “Nope, it’s freehand.” he said with a smile, “I’m Kevin Wassong, sophomore—damned glad to meet you.”

We walked out of the building and continued to talk as I watched him exchange pleasantries with other students. He had a way about him, an infectious energy somewhere between Andy Dufresne in The Shawshank Redemption and Kevin Arnold from The Wonder Years. He was instantly likable.

Our friendship grew that semester, and I pledged his fraternity in the spring. The following year, we lived together and continued to build our bond. When he graduated in 1990, he headed west to work at Creative Artists Agency. His passion was entertainment, and he set out in search of his dream.

While he was at the Newhouse School of Communication and I studied business, we used to talk about one day going in to business together. 20 years later, we would do just that.

Spring Training

I edged my way through Syracuse University but wasn’t sure which career path to pursue. I enjoyed accounting, but finance was entirely more exciting. I reminded myself that if I wanted to make money, I needed to stand near the cash register.

The deepest drawers were on Wall Street, I knew, but I didn’t have blue blood or any means of infusion.

I was a solid student and took my academic career seriously despite an active commitment to collegiate hedonism. I was competitive — perhaps because I felt I had something to prove — and when I began to view my course load as a contest, I excelled in kind. I was obsessed with success and the empowerment that came with it.

Dean’s List felt good, so I kept making the grade. After waiting tables my freshman year, I took a bartending class over the summer and worked at several bars before landing a job as a bouncer at Harry’s, one of the more popular hangouts on the hill. I had no interest in standing in the Syracuse chill, but it was an opportunity to get my foot in the door and I grabbed it. That, too, would be repeated throughout my career.

One night, when the regular bartender called in sick, I was asked to fill in. Under the watchful eye of the owner, I was “high ring,” putting more money in the till than the older, more experienced pourers. I joined the rotation, and with each successful night, was given more latitude. In a few short months, I had my choice of shifts.

There I was—bartending at my favorite pub as I excelled in school, enjoyed fraternity life and did the sorts of things college kids should be doing. I had it all, yet I wanted more, the fatal flaw of a classic over-achiever.

The Ace of Spades

During my junior year, I aced my finance midterm and blew the curve. Pride would have been the appropriate reaction but I studied my few wrong answers and loathed the lack of perfection.

That was my style—set the bar too high so if I missed, I was still ahead of the crowd. It wasn’t the healthiest approach; while it pushed me to bigger and better things, it never allowed me to feel a complete sense of accomplishment.

After that midterm, the professor called me to his office. I allowed myself a rare moment of satisfaction as I rushed across campus to accept some praise. When I arrived, he grilled me with questions and after a few minutes, I realized what was happening.

“You think I cheated?” I asked, humbly at first but then with increased agitation, “I busted hump for this class and you’re going to accuse me of cheating?”

Following an intense discussion, the conversation eased into a healthy dialogue. He ran the Department of International Programs Abroad (DIPA), and there were several internship opportunities overseas that summer—most of which were geared to MBAs—and he began to gauge my interest.

I asked him what was available and he listed them in kind. Manufacturer’s, Hanover. Saatchi & Saatchi. Morgan Stanley (MS).

“Morgan Stanley?” I asked, recognizing the name of the biggest cash register on the Street. “If you can get me the job at Morgan, I’ll gladly hop the pond for the summer.”

London Calling

When I accepted the internship at Morgan Stanley, I had no idea it was the only paying position. That’s good news for a young kid living abroad and staring at tens of thousands of dollars in college loans. I packed my bags and headed to London for the summer of 1990 between my junior and senior year.

I was placed in Operations Control and was the kid who told the producers on the trading desk there were errors in their accounts. As an intern, I was low man on the totem pole. Given that I worked in Ops Control, I was low man on the lowest totem.

I lifted weights in college and had the muscles to prove it. That was helpful in the bar but provided little utility in business. I felt very small when I stepped onto the trading floor each day and wove my way through the verbal barrage. It was scary yet exciting, unlike anything I had ever experienced.

By the time August arrived, I was physically drained, emotionally spent, intellectually challenged and completely sold. Yes, it’s safe to say that by the time I returned to the states, accounting was no longer an option.

I didn’t want to crunch the numbers. I wanted to create them.

The Relationship Business

My senior year was supposed to be the best time of my life, the final episode of innocence before embarking on a career. I had the college experience perfected and looked forward to my Syracuse finale.

The stage was set—I bartended at my favorite spot, belonged to an awesome fraternity, and my GPA was on cruise control. I had one eye on the future but my other body parts were firmly committed to squeezing every ounce of life from my remaining time in upstate New York.

The weekend after I arrived home from London, I was lounging at my girlfriend’s home in New Jersey, wasting away a summer day. It was raining, there wasn’t much on television, and we had already eaten, among other things. Bored, I randomly decided to call my aunt, who lived nearby.

Karen was my mother’s college roommate and my father’s cousin. She introduced the two of them, which would explain why she always took an active interest in my well being. As we caught up, she told me of a friend of hers who worked at Morgan Stanley. “You should give him a ring,” she said, “He’s a great guy and a close friend.”

I called Chuck Feldman, who I later realized was a legend on Wall Street. He pioneered the equity derivative business and ran the show at Morgan Stanley. He was the quintessential old-school trader who worked his way to the top and ruled the roost.

His high-pitched voice was extremely soft-spoken on the phone. That’s the first thing I remember about Chuck, how soft-spoken his voice was. It would be the last time I ever had that thought.

He lived in a neighboring town and invited me to swing by. We met for a half hour and had a pleasant enough conversation. He wasn’t a large man, but his presence cast a long shadow.

There was no way to know that it was thirty minutes that would forever change my professional path.

It was thirty minutes that handed me the keys to the cash register.

The Fast Track

I was preparing for our annual toga party after the first semester of my senior year when my phone rang.

“Hey Todd, its Chuck. Listen—we have an opening on the desk and I need to know if you’re interested.”

I was surprised at how noisy the trading room was in the background. “Uh, I’m very interested,” I said, holding the phone in one hand and a Heineken in the other, “but what about school?”

“You can finish up by mail.” he shot back in his patented pitch.

He paused to bark an order at someone. His voice was anything but soft-spoken.

“Let me know if you can start next week!”

That was my chance, I thought—a once-in-a-lifetime opportunity to bypass the rigorous two-year training program at a top-tier firm, which would then spit me back out to get my MBA, and sit on one of the best trading desks in the world.

I spent the next day chasing professors, pleading with them to shift my course load so I could start at Morgan and still graduate with my class. One by one, they agreed and by the next day, I was set. My girlfriend cried in the background as I picked up the phone to deliver the news to Chuck

“I’ll be there Monday morning,” I said in the most confident tone I could muster, trying to mask my nervousness.

There was silence.

“Hey kid,” he finally said, “Why don’t you finish school and call me when you’re done.”

I didn’t know what that meant—was I getting the job? Did I do something wrong? Did he change his mind? All of these thoughts raced through my mind before I realized he already hung up.

I continued my senior year, occasionally sprinkling a random call to Chuck with hopes of staying on his radar. Each time he was cordial, but at no point did he renew his offer. I tried to enjoy the remainder of the college experience despite the uncertainty that lingered.

Finally, a few days before I graduated with my class in the spring of 1991, I got the wink. “Come in kid, we’ll see what we can do.”

To this day, I don’t know if Chuck’s initial offer was a test to see how badly I wanted the job or an impetuous gesture he later second-guessed. It really didn’t matter—I had my foot in the door and head in the game.

The following Monday, as my friends left for Europe and I nursed a wicked post-graduation hangover, I paced the pristine lobby at 1251 Avenue of the America.

I could almost smell the money.

R.P.

5 Reasons Why You Should Wish My Mom A Happy Birthday Today!

Posted by Timothy Sykes on Tue 14th of Jul, 2009 08:07:01 AM

That’s right, today’s my mom’s birthday and I want ALL you guys to wish her a happy birthday in the comments section below because…
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This Is My Top Student, Up $75,000+ In A Year…

Posted by Timothy Sykes on Fri 10th of Jul, 2009 08:15:37 AM

I can’t make this stuff up, this is the high school photo of the guy who has made over $75,000 and $30,000 in 2009 using the trading strategy outlined in all of my instructional DVDs…he’s also the first TIMalert lifetime subscriber…and he has THIS cool chart (scroll down) of his trading gains using my stuff!

Behold, Reaper aka Michael Goode, the blogger behind Goode Value:
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This Ashton Kutcher Video Says A Lot…

Posted by Timothy Sykes on Sun 5th of Jul, 2009 09:15:57 AM

..about what interests people because it’s currently the most popular link on Bit.ly (you can see the popular links updated hourly by following their Bitlynow Twitter profile (and follow me too HERE!)

Check out the video here:
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Paul Tudor Jones Speaks: Learn From A Billionaire Hedge Fund Manager

Posted by Timothy Sykes on Wed 3rd of Jun, 2009 05:45:23 PM

Paul Tudor Jones (PTJ) is one of the greatest traders/fund managers of all time, learn about him in Wikipedia HERE.

Very nice, but more importantly, he gave a great interview to Alpha Magazine HERE so I’ve reposted the whole thing below (thanks to BS for finding this article)

Learnnnnn from a true trading master:

What’s so special about macro hedge fund managers?

I love trading macro. If trading is like chess, then macro is like three-dimensional chess. It is just hard to find a great macro trader. When trading macro, you never have a complete information set or information edge the way analysts can have when trading individual securities. It’s a hell of a lot easier to get an information edge on one stock than it is on the S&P 500. When it comes to trading macro, you cannot rely solely on fundamentals; you have to be a tape reader, which is something of a lost art form. The inability to read a tape and spot trends is also why so many in the relative-value space who rely solely on fundamentals have been annihilated in the past decade. Markets have consistently experienced “100-year events” every five years. While I spend a significant amount of my time on analytics and collecting fundamental information, at the end of the day, I am a slave to the tape and proud of it.

Is it possible to teach someone to be a tape reader — what some might call a trend follower or technical analyst?

Certain people have a greater proclivity for it because they don’t have the need to feel intellectually superior to the crowd. It’s a personality thing. But a lot of it is environmental. Many of the successful macro guys today, they’re all kind of in my age range. They came from that period of crazy volatility of the late ’70s and early ’80s, when the amount of fundamental information available on assets was so limited and the volatility so extreme that one had to be a technician. It’s very hard to find a pure fundamentalist who’s also a very successful macro trader because it is so hard to have a hit rate north of 50 percent. The exceptions are in trading the very front end of interest rate curves or in specializing in just a few commodities or assets.

What’s your take on the next generation of managers?

I see the younger generation hampered by the need to understand and rationalize why something should go up or down. Usually, by the time that becomes self-evident, the move is already over. When I got into the business, there was so little information on fundamentals, and what little information one could get was largely imperfect. We learned just to go with the chart. Why work when Mr. Market can do it for you? These days, there are many more deep intellectuals in the business, and that, coupled with the explosion of information on the Internet, creates the illusion that there is an explanation for everything and that the primary task is simply to find that explanation. As a result, technical analysis is at the bottom of the study list for many of the younger generation, particularly since the skill often requires them to close their eyes and trust the price action. The pain of gain is just too overwhelming for all of us to bear!

You’re not necessarily a fan of hiring people straight out of business school.

Today there are young men and women graduating from college who have a tremendous work ethic, but they get lost trying to understand the logic behind a whole variety of market moves. While I’m a staunch advocate of higher education, there is no training — classroom or otherwise — that can prepare for trading the last third of a move, whether it’s the end of a bull market or the end of a bear market. There’s typically no logic to it; irrationality reigns supreme, and no class can teach what to do during that brief, volatile reign. The only way to learn how to trade during that last, exquisite third of a move is to do it, or, more precisely, live it — a sort of baptism by fire. One has to experience both the elation and fear as markets move five and six standard deviations from conventional definitions of value.

How will macro investing fare over the next five years?

The macro space will be great. I think we’re going into one of those slow or zero-growth periods in the U.S., which will give us a lot of volatility.

Will hedge funds do as well as they have done in the past?

Average returns will drop. The amount of money that was made by hedge funds in the past two decades was so outsize relative to anything in civilization in the past couple of centuries that it naturally attracted the best intellectual capital in the world. As a result, the inefficiencies that existed in the ’70s and ’80s and even the ’90s are not as readily seen. But in this business there will also always be that upper tier — that top 10 or 20 percent of managers who will outperform everyone else.

What experience had the biggest impact on your career?

Trading commodity markets back in the late ’70s — when they were still extraordinarily volatile — allowed me to experience repeated bull and bear markets across a variety of different instruments. Remember, in agricultural markets the cycle can be just 12 months. I lost my stakes a couple of times, which taught me risk control and risk management. Losing those stakes in my early 20s gave me a healthy dose of fear and respect for Mr. Market and hardwired me for some great money management tools. Oh, incidentally and by necessity, I became a pretty good fundraiser, which has helped me in the not-for-profit world.

Who’s had the biggest influence on your career?

My first boss and mentor, Eli Tullis, of New Orleans. He was the largest cotton speculator in the world when I went to work for him, and he was a magnificent trader. In my early 20s, I got to watch his financial ups and downs and how he dealt with them. His fortitude and temperament in the face of great adversity were great examples of how to remain cool under fire. I’ll never forget the day the New Orleans Junior League board came to visit him during lunch. He was getting absolutely massacred in the cotton market that day, but he charmed those little old ladies like he was a movie star. It put everything in perspective for me.

What was your single best trade or investment?

Probably buying March put options on the Japanese stock market in early February of 1990. The volatility was an absurd 5 percent, owing to the newness of the options market, with which many Japanese had little experience. Much like the U.S. stock market just before the 1929 crash, the Japanese stock market in early 1990 was following the same price pattern with remarkably similar fundamentals and valuations that provided enormous profit opportunities in a truncated period of time. I actually felt sorry for the people who were on the other side of that trade when I was buying those puts.

Your biggest missed chance?

I missed the subprime opportunity of 2007, and it rankles me every time I hear the term. We have studiously avoided mortgages at Tudor specifically because it is a big-carry game that does not adequately compensate for the inherent tail risk. That unfamiliarity, though, came with a huge opportunity cost.

Is the price of oil high for fundamental reasons, or are hedge fund managers and Wall Street driving it up?

It’s a very bullish supply-and-demand situation, and the peak oil theory is probably correct. But the run-up in prices is now bringing in an enormous amount of speculative, nontraditional capital such as pension funds and university endowments — principally through index products. Commodities have been the worst-performing asset class behind stocks, bonds and real estate for the past 200 years, but Wall Street doesn’t highlight that long history when selling commodity index instruments today. Instead, it shows a chart of the bull market of the past 12 years to rationalize why some pensioner should be long cattle futures in the derivatives markets as part of a basket. I am sure they were using similar logic about tulips three centuries ago. Oil is a huge mania, and it’s going to end badly. We’ve seen it play out hundreds of times over the centuries, and this is no different. It’s just the nature of a rip-roaring bull market. Fundamentals might be good for the first third or first 50 or 60 percent of a move, but the last third of a great bull market is typically a blow-off, whereas the mania runs wild and prices go parabolic.

Should hedge funds be more closely regulated?

I selfishly do not want to be regulated, but I understand the necessity of it.

An All-Encompassing Guide To Businesspeople On Twitter

Posted by Timothy Sykes on Fri 1st of May, 2009 08:15:21 AM

Thanks to a reader for sending me this list, before I simply posted a list of celebrity Twitterers, but this one is much better linked and more comprehensive. Enjoy and follow me on Twitter already!
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Wall Street Movie Sequel Deal Now Finalized With Oliver Stone Directing Michael Douglas & Wannabe “It” Boy Shia LaBeouf

Posted by Timothy Sykes on Wed 29th of Apr, 2009 08:05:59 AM

UPDATE: This movie will be entertaining, or as entertaining as a business movie ever can be, but it won’t teach you how to profit from the stock market…for that you need to watch free training videos or study guides like these.

Oh yeah, this project has been around for several years, but only now that society wants to see Wall Street suffer for its sins has it been greenlit.
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4 Reasons Why Susan Boyle Is & Is Not Like A Penny Stock…

Posted by Timothy Sykes on Sun 19th of Apr, 2009 09:45:55 AM

As I outline in my PennyStocking DVDs and THIS FREE EBOOK, a Supernova chart pattern, the ones that’s made me millions of dollars over the past decade.

Like Ashley Dupre, aka Sptizer’s girl, Susan Boyle shares some qualities with Supernovas, but she also differs a bit too and that’s why when I make the comparison, I wouldn’t short her….just yet

1. SIMILAR: massive massive hype and press due to the novelty of the idea and a dominating coordinated PR effort by Simon Cowell’s companies (he would be the best damn penny stock promoter ever!)

2. DISSIMILAR: S.B. has the unique story and enough talent that will likely make her a star…question is for how long…remember that other opera dude Paul Potts who Cowell made believe was a cell phone salesman shot to fame and now has pretty much faded…like most singing contest winning stars (it’s all marketing!)

3. SIMILAR: Like Paul Potts, Susan Boyle isn’t some undiscovered sensation…she had a 1999 album…yup…this time she hit it big with marketingggggg! Most Penny Stocks rise due to hype and manipulation, don’t hate on it, love it!!!!

4. OK, here’s the viral video of her singing, she has a great voice, but the key is her look and people’s expectations…kinda like a homeless hedge fund manager

I’m 100% sure, some kind of news will break over the next few days and weeks that lessens her star–no, I’m not a cynic, I just know how hype and manipulation works–but for now Susan enjoy it, your reaping the rewards of partnering with Simon Cowell, the world’s #1 promoter.

This Is A Good List Of Celebrities On Twitter aka Celebrity Twitterers

Posted by Timothy Sykes on Sat 18th of Apr, 2009 03:00:17 PM

First, you gotta follow me HERE because I’m the only non-celebrity on this list!
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7 Reasons Why Jim Cramer’s Career Is Better Than Ever

Posted by Timothy Sykes on Thu 26th of Mar, 2009 08:05:02 AM

Considering how much debate has now broken out about whether Cramer’s career is over or not, I had to do a follwup…
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