Equities will be the last to go
Our American Empire is backed by a petrol dollar. It is the reserve currency of the world and every country, if it wishes to buy or sell oil on the international market, must have a central bank fully stocked with greenbacks if it wants to do bidness. This basic fact means that America is able to live far, far beyond its means. Other nations hold the eye-watering levels of debt we produce domestically and thus, shield the people living in a unique City on a Hill from the full effects of hyperinflation. Our biggest export is trillions in IOUs that other countries have consumed out of necessity for decades. If you want energy and if you want to transact with peers, you will have to have American dollars.
At least until recently.
Whenever any non-American complains about the imperial bloodlust of America and its passion for violence and military hardware, they should be reminded that it was all made possible by their own government which has held the mighty dollar when it should have become ashes.
As the spending binges have grown larger and as the supply of dollars has inflated, there has been an incredible pumping of asset prices. Stocks and houses come to mind as both are considered something worth holding as a store of value when other instruments (like savings accounts) have become eaten up by the moths of inflation. Commercial real estate hangs over the abyss, another "asset" that has turned into a bleeding liability on the balance sheet of banks world wide.
In the world of stocks, things like P/E don't mean anything anymore when looking for something to buy because such valuations harken back to a time when liquidity was not something injected by the trillions artificially into the economy. In the 90s, I started reading about the shock and horror of skyrocketing P/E ratios from old timers who were used to stock valuations being reflective of a company's overall actual performance. Greenspan, Rubin and Associates helped break all the rules about investing though and it wasn't long before stocks began a long rise in nominal value even as companies showed anemic or non-existent profits.
Offshoring, H1-Bs (indentured servitude for Indians), stock buy backs, de-industrialization, corporate "investment" in politicians, etc. have all worked together to keep the American capitalist endeavor alive, long after it has become a menace to all life on the planet.
I spoke with a man recently who owned Microsoft stock when it sat at $35 per share and never moved. According to ChatGPT, this was around 2013, right before the QE and super low interest rates began to kick in. He eventually cancelled the position since it didn't move only to see it go on a tear in the years following. He bought and held when the company P/E still meant something. Just in the past month, the stock has moved $35 or more in either direction, up and down, in a matter of days with its share price sitting around $460.
I watched passively over the decades as the asset bubbles kept getting bigger and bigger. In 2008, the housing bubble popped. My expectation throughout all the various phases and varieties of bubbles has always been "oh well this simply cannot go on, everything is overvalued, it must stop." I still invested here and there and did okay but the thought of actively trading any instrument was to me pretty pointless. As with the dotcom era, anyone buying during QE was likely to make money if they just focused on a few tech stocks. Everyone is an investment genius when the fiat is flying. So I didn't learn much, just how to place an order for whatever tech stock was hot. I did better than the fund managers who handled my 401k investments in the past.
I had colleagues in the 90s who had made millions off of their company shares, ones which had hitherto sat collecting dust for a decade or more. No sooner than entering the ranks of the well off, they frittered much of it away on day trading. I would walk by their cubes and see dual monitors with E*Trade up during the morning hours. Their productivity dropped to nothing but no one minded. Reserve currency fiat changes everything and in that golden era, prosperity was everywhere and Bill Clinton told us that come 2000, our trillions in debt would be paid off thanks to the wise economic policies of his adminsitration.
The company of course went out-of-business, delisting from its exchange on the grounds that it had made a profit for the large stakeholders and had no other purpose than to vanish with the dotcom bubble's passing. Profits were returned to the rightful parties and 100+ souls were sent to the unemployment line.
Fast forward to today: Confronted now with a bleak future where my career is shredded by foreign replacements and AI or some combination thereof – and let me just say that corporations don't yet understand the productivity gains to be had by the latest generation of LLMs and employees are probably not eager to advertise them – I began thinking about survival. Having seen someone dear to me go through a replacement by Indians recently and having watched him struggle with what to do as he approached the age of 60 as an unemployed white male, it occurred to me that I am facing the same path.
The Indian replacement of American workers has become noticeable and American noticers are doing some noticing about this encroachment onto their petrol dollar-backed lifestyle.
This brings us to my new hobby. Hobbies have a way in a pinch of becoming a side hustle or even a main source of revenue.
Day trading is a form of gambling in the minds of most people and frankly, it should remain in this frame. It's not my hobby, but my side piece to my primary profession. As someone who practices meditation and of late, pays lip service to mindfulness in daily living, getting out of bed early every morning to trade stock before going to the regular job has been a mixed bag.
Before getting into my reflections on the actual activity of day trading, I will give some basic reasons for choosing this venture.
One, I'm middle aged and it is unlikely I will be able to remain in my current white collar profession for much longer. If I can squeeze out two or three more years before getting shitcanned, offshored, inshored or otherwise "reduced" as they say, I will have at least time to begin making my transition.
In the West, transitioning usually refers to chopping off your dick or your tits to better support the image you hold of yourself. What I mean however is one of several more archaic senses based on moving from point A to point B: retraining, learning a new set of skills to survive, retooling. This current form of fat, muscle, bone, hair, teeth and so on requires a lot in order to function. Much of my professional work so far has been self-directed and it's worked out really well. No reason I cannot do the same with day trading.
Second, day trading is tied to stocks, futures, forex and other financial instruments which are the life blood of the American empire. Her oligarchs, her boomer pensioners, her insurance companies – all of them are anchored deeply into the financial markets and those will be the very last thing to go. Period. Housing prices will crater and the market itself will pull back as it did during the GFC and all the other economic crises which make up the capitalist merry-go-round. But the markets themselves will remain intact and functioning as long as there is still some semblance of America.
Everyone talks about the stock market crash of 1929, yet never mention the massive implosion of the industrial sector of the American economy over decades which has taken place in their own lifetimes. In living memory, many Americans have seen their country gutted physically and socially by global capitalism. Yet the stock market is still here, awash in liquidity that pours in from all over the planet, doling out riches to whomever will learn some basics and exercise self-control. The last effectively removes 90% of would-be professional, profitable traders.
The markets will remain long enough for me to cast off the current mortal coil and move onto the next one, hopefully located in the womb of a good Buddhist woman living in a happy marriage to a good Buddhist man in a super Buddhist country. It sounds really Boomer to say this, but I only hope to be self-sufficient until death and that this will probably coincide with the final death rattle of America. No one can predict of course with absolute accuracy and there is always karma to remember.
Third, day trading is you working for yourself. There is no capitalist manager/overseer who can offshore your day trading occupation to an Indian or Chinaman. If foreigners want to trade in the American markets, they can, right now either with their own cash or someone else's. My hunch is not many do relatively speaking, but the ones who do send their money to American exchanges.
In the market, every retail trader is his own damn man. This means of course that you can go to work and not only not get paid, but come away from the exertion with less capital than you started with in the morning.
But this is true of any self-run business. I've heard day traders speak about this peculiarity, apparently unaware that small business owners, especially when they first start out, are prone to mistakes that leave them in the red for days, weeks or longer. I've been through that and know what it looks like and it's just as bad as losing money day trading.
The trap of industrialism, when men exchanged their freedom for servitude, is that everyday is a green day as we say in trading, but you are completely expendable.
Day trading is going out in the early morning to catch fish or kill a deer (neither of which of course are conducive to the practice and should be avoided). You may catch your food and survive to do it again the next day, or you may miss and be stuck with hunger pains to remind you of your failure. This to say that day trading is no different from the kind of foraging our hunter gatherer ancestors did for innumerable years. Every animal today lives like this and we, at the end of the day, are still part of the animal realm.
The wise, the pure, the virtuous will say that day trading is gambling because it relies on fear, greed and anxiety, that it defiles because it is by its vary nature at odds with nature. It's dollars creating more dollars in seconds, minutes. Black sorcery! The fires of greed can overtake the gambler, leaving him overrun by his emotions and his basest impulses.
If anyone thinks that the work life in whatever form is free from fear, greed and anxiety, then he is a most deluded creature. This is one of many lessons I've learned over the past few months by grinding out at the trading desk each morning. The nature of any post-industrial work is that it involves all the same emotions and pollutions as day trading, but they just spread out over decades, day-in and day-out. Highly impulsive actions can and do take place of course when the opportunities present themselves and one can easily destroy a professional reputation or career by acting inappropriately on them.
Day trading is unique in that opportunities for destruction are in theory present in abundance each morning beginning at 4:00 AM. It is this frequency and ease – the temptation if you will – to act heedlessly that distinguishes day trading from the normal grinding occupations. No matter how adjusted you become to trading stocks every day and how acclimated you become to spending large sums of money for the purpose of making a little more, there is always that one stock that looks so good, smells so good, tastes so good that you might fall over the edge and blow up your account. You haven't day traded until you've spent $2,300 to make $6.06 in profit. I have. It happens.
One day trader I know observed out of the blue that day trading will, if nothing else, teach you things about how your mind works. The slightest attention caused by uniquely configured moments shows how our minds work and several months of day trading reveals interesting patterns to ourselves about how we perceive and process information. Nothing can make you examine your mental processes like trading stocks on a 5 minute time scale with hundreds or thousands of dollars at stake.
I am not a profitable day trader by any means and do not expect to be consistently having green days for a few years. It's not that I plan to fail for that long, it's just a number I came up with based on listening to professional traders talk about their experiences. Many have gone much longer losing money or just breaking even. There's enough good material out there now that it's possible to learn from others and thus, spare oneself a lot of pain...
... or not. The thing with trading is that no matter how many courses, lectures or books you read on the topic, you will end up making the mistakes that all traders do because there is a human nature shaped by evolutionary forces. Our karmic conditioning is unique to us and gets poured into a mold from lifetime to lifetime, but there is the matter of our forms which are wholly caused by impersonal forces over stretches of cosmic time. I suspect that even our forms our chosen based on our wants and our deeds, but we do not have complete control over the ones we take.
One way of looking at the spiritual path is how identification with the vessel of fear, delight, avarice, satiation can be ended. The vessel just is seen for what it is, a very impermanent, throw-away housing that very easily becomes coextensive and coterminous with the heart/mind. This mingling is the source of suffering since the natures of the two are completely different. This is the con that leads virtually all of us in life, that these natures are one and the same.
This to say that day trading can, if one is paying attention, teach us something about our mental states, especially as it relates to fear, anxiety, loss and victory.
