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The Blue Money Report |
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Welcome to the Blue Money Report
Turning to Max While the process to invest has become more intuitive, more orderly, and more available, it has yet to become a reasonable place to spend your money. Investments can be called many things but they are basically a shopping experience without compare. That said, we are looking for the best way to look at the best deal. Max Planck, a Nobel Laureate used quantum mechanics. He suggested that all things could be broken down in five basic categories. These parts were called quanta and it was believed by him that these parts could be measured individually. Energy, momentum, position, size and time, the five components of quantum mechanics, all had a place that could be defined. Until recently.
Was there ever a more accurate description of the parts of the market than energetic? It possesses energy by the bucket load. We can easily measure the excitement by the harried pace of the bond pits or the floor reaction of the traders to some piece of news. The market breathes creating an energy, inhaling when it seeks to expand, and out when it contracts. It is this energy that draws us to it in with such wide-eyed amazement. Only the most experienced and seasoned among us can look with a truly jaded at the nature of this energy and not feel something.
Momentum is measured daily through the frantic and frenetic reports that drift across the banner at the bottom of your television and computer screens to the reporters whose assignment is much the same. This is the domain of the chartist the analyst and the t.v. talking heads. They measure and seek to quantify something abstract all the while trying to make it palpable. These folks do not however influence this part of the equation in anyway, or at least that is how it is supposed to work. The days of cheerleading have given way to disclosure. Personally, I am nostalgic of those times when reporters seemed as excited for our crazy ways as we were. Only they knew we were fools. Once the trading day is open, momentum can be explained in a wide variety of ways from news related to seasonality.
Position is largely determined by price. Of course price is determined by momentum and its seemingly inseparable sister energy. Too often we concern ourselves with this piece of the puzzle making only cursory glances at the whole. No problem because position cannot, no matter how we try to change it become the only part of the equation with merit. We look at yield or dividends or any of the seemingly innumerable pieces of the pricing puzzle and we are left with are two possible approaches: taking an educated stab or as I have so often suggested, employing dollar cost averaging to do the dirty work.
It is much easier to move a kitchen chair than a living room sofa. Ownership of the market is determined by the size of your investment. This portion of your involvement should be well diversified and that should be the built in protection protecting you from whatever you have given to your investment. Too large and your investment lacks mobility. Too small and we treat it as something of little consequence. Size, position, momentum and energy are for the most part of Mr. Planck's theorem of quantum mechanics less important than the measure of time.
Time, which the decorated and renowned physicist sought to explain as a frame-by-frame collection of individual pictures strung together much the same way as a movie is produced was at the cornerstone of his calculations. Recent discoveries far out in space have made this piece of the puzzle less relevant because life it turns out does not happen in frames. A continuum yes, a movie, no. Instead it has been suggested that time happens at different speeds and those speeds allow time to run together, burring the whole net and tidy little concept.
So what is it about time that we think is measurable? How often have you heard that "now is the time" to buy or sell or worse, jump in with both feet? How does anyone know that with any exactness? They don't.
So if physics has proven that time cannot be quantized how can investors make use of the immeasurable flow of information around them? If all of the information you receive, all of the news you hear, all of the resources you pursue, can be filtered through the first four principles of the theory, then the last will surface without any real need for measurement. I am sure that this is contrary to what Mr. Planck had in mind. But lets see if we can make this theory work in its new improved state.
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