TheHungarianContrarian

“Mr. Bond, they have a saying in Chicago: ‘Once is happenstance. Twice is coincidence. The third time it’s enemy action.’” … Last October about 3.5% or $2.4 trillion was wiped off of the U.S. stock market’s value in one afternoon. As is often the case, bitcoin was no safe haven—it fell about three times as much. The spark for the selloff: President Trump posted on his Truth Social account that the U.S. was considering fresh trade measures against China.

Dear valued clients, Sometimes I feel like explaining what I do with your money takes almost as much effort as making it grow. Still, it’s worth it. I’m confident that one day these quarterly letters will be published as a tome not just on successful investing but on how to succeed in life. Thanks for reading TheHungarianContrarian! Subscribe for free to receive new posts and support my work.

Mrs. Jakab and I have turned into curmudgeons who bore our three adult sons with tales of walking barefooted five miles to school in the snow uphill both ways. One recurring theme is how tough it was to get a good job in the recessionary early 1990s. Young people laser printing cover letters and résumés and mailing them by the dozen must have been a major profit center for Hewlett-Packard, Kinko’s, and the postal service.

There’s only one company you’ll recognize among the dozen original members of the nearly 130 year-old Dow Jones Industrial Average: General Electric. The others were American Cotton Oil, American Sugar, American Tobacco, Chicago Gas, Distilling & Cattle Feeding, Laclede Gas, National Lead, Tennessee Coal and Iron, U.S. Leather, U.S. Rubber, and North American. Are those names exciting? No. Descriptive? You bet, with the exception of that last one (it was a utility).

I was going through old paperwork recently and ran across something from a much simpler era—my federal tax return for 1992, filled in by hand. My apologies to the IRS agent who had to read my cramped penmanship. I assume there are a few people who still do it the old-fashioned way, but by 1997, when I was married and had to deal with three countries’ tax authorities, it just got way too complicated. Apparently it also did for PriceWaterhouseCoopers, who made an expensive error—arrgh.

There’s a type of person I know who’s very educated yet shockingly naïve about some things. We all have our biases and blind spots so I’m sure the same applies to me, but I don’t think it does about yesterday’s electoral earthquake in New York City. I’ll state from the outset that this isn’t a political newsletter: I don’t support a candidate, am not registered to any party, and I’ve never given money to one. I also no longer live in the city—I just go there a lot, including for work.

“You know economists—they’re the sort of people who see something works in practice and wonder if it would work in theory.” Ronald Reagan didn’t come up with that line, and the joke was around way before his speechwriters found it in 1987, but he sure could deliver folksy zingers. That was the year I graduated from high school and, even before I took my first class in the dismal science, I got a firsthand economics lesson in what does and doesn’t work.

Back when I was in elementary school in the late 1970s, what my friends and I wanted to be when we grew up came up from time-to-time. The number one answer by far was “photographer for Playboy,” followed by drummer for KISS. A few degenerates wanted to be lawyers. Now that I’m middle-aged, I understand that the best job in the world is one that provides a decent living without feeling like work—one you’d still show up to do tomorrow if you won the lottery.

By now you’ve realized that the early stages of the trade war have turned your 401(k) into a 301(k) and are wondering how it’ll all play out. It’s at times like these that I get questions from long-dormant Facebook contacts, my mom’s childhood friends, or neighbors who spot me out for a walk. “So, what do you think about the stock market?” Thanks for reading TheHungarianContrarian! Subscribe for free to receive new posts and support my work.

A few weeks ago I was in Boston visiting my son, who goes to college there. I’m a very early riser (especially since starting my new WSJ newsletter) and he isn’t so I used the opportunity to meet an old college friend who lives in the suburbs for breakfast. She told me to meet her at “Newton Centre.” I was expecting our breakfast to be at a shopping mall since anglicized names are a weird hallmark of American commercial establishments.