BALDER AIEAS The Market Crash Test Balloon – This Week in Investing

I know this week in the stock and crypto markets has been difficult for many people. I’m not one of them. My stock portfolio and my crypto portfolio both lost quite a bit of value over the past month – this week was more of the same. I feel good about every decision I made this week – with one exception – after taking sharp declines in my shares of TVIX, I sold a little above break even and missed 80% growth the past two days…in this case, I let my fear of losses outweigh my desire for gains. And, let’s be honest – I was drinking the kool-ade, I was mostly believing the narrative that the markets would simply keep going up and up and that the crash would come sometime in late 2019 or 2020.

The pullback hit a lot of the rising tech stars of 2018 the hardest. Yext, AMD, Square – along with some old favorites like Ali Baba, Amazon, Google, Netflix. Oddly, Tesla didn’t suffer much, maybe because a bottom was already in. McDonalds and Starbucks both weathered the storm nicely, with both companies actually taking gains in a sea of red. Gene editing, industrial automation, electric self-driving cars, and marijuana stocks all took hard hits.

With all the blood in the equity markets, I thought cryptocurrencies might stage a rally but there was some news timed just right – Gemini, the crypto giant created by the Winklevoss Twins, was denied their bitcoin ETF, again by the SEC. So, crypto dropped significantly.

At this point, I”m grateful to crypotcurrency for making me a better investor. Yes, my investments are down by large margins compared to a year ago, but bitcoin and alt-coin losses have made it possible for me to suffer 20% losses (or 90% losses) and not lose my head. I’ve seen the massive volatility, the rise and fall of shares and all of that has brought me back to the fundamentals. Invest in companies for the long term. Find quality companies with quality management. Watch for buying opportunities. Let winners run. Ditch losers early. Take profits when you can.

The hardest part of this week was controlling the urge to cash in my savings and invest it in more shares of Amazon, Square, AliBaba, and Yext. I’m still bullish on IBM, but sold most of my shares a few weeks ago at the highs. My investing goal right now is to take enough profits to step out of my margin account. This week demonstrated the danger of margin – luckily, I avoided a margin call, but essentially a margin call would have meant 2x the loss.

I’m still drinking the Kool-Ade, by the way. I think the markets are going to rally through the next 12 months with a couple little down turns. I’m hopeful that we’ll see a bitcoin/crypto rally in the next few months as well. The market is going to come down – but the policy makers have enough control at the moment to keep it bouncing back. The range on that is narrowing, however.

My strategy moving forward is to continue scooping up quality companies at bargain prices. I don’t think that Amazon, IBM, Editas, AliBaba, or Square are going anywhere but up from this point. I’m calling this the AIEAS strategy. I live near the town of AIEA, Hawaii. It’s the only U.S. city with no consonants.

For my consonants, my crypto strategy. Bitcoin (BTC), Cardano(ADA), Litecoin(LTC), Digibyte (DGB), Ethereum Classic (ETC), and Ripple (XRP) – or BALDER.

I’m not a classic conspiracy theorist, but I do think that there are great powers pulling the strings behind the scenes. We see some of what they are doing, but most of it is obfuscated. I believe that this past week was a test balloon to see how markets would react and what they could make them do. Yes, rising interest rates, yield curve, inflation, and more were at play – but the bottom line is – nobody that I’ve heard or read, has given a compelling arguement for why this massive crash happened – there was no obvious catalyst. More crashes will come and more bull runs. The invisible hand is at play here. We don’t know what it is heading towards, why it is making the moves it is making, or when they will happen – only that they will happen.

So, my AIEAS BALDER strategy is designed with that in mind. Quality companies and crypto projects. The bulk of my investment will be in Bitcoin and Amazon. They aren’t pure safehavens, but they are the best we have at the moment.

What do you think?

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