Anyone who has ever done any investing will almost certainly have got it wrong at some point. I doubt though, if many have made such a bad decision as Ronald Wayne did in 1976. That was the year of the glorious summer, when Britain baked for three months without a drop of rain. Ronald proved to be a rather less able sharpshooter than his illustrious namesake John. In case the name rings no bells, Ronald was the third partner in a new start-up in April of that year called the Apple Computer Company. Two friends, Steve Wozniak and Steve Jobs founded the company along with Mr Wayne, who had a ten per cent share. He elected to sell his stake a mere twelve days into the nascent operation for a few hundred dollars. He should just have retreated to a remote desert island for a decade of two, drunk coconut milk and learnt to whittle silhouettes of partly eaten apples that could have decorated the entrance to company HQ in years to come. Had he done so, his stake in Apple would now be worth in the region of $100bn. I wonder how often he thinks about that!
I have been attempting all sorts of ruses to make a fast buck for years, largely without success, although there have been a few glorious moments. Probably the most exciting, but ultimately frustrating was during the last US Presidential election. A financial newsletter I subscribed to was convinced that Trump would win and advised it’s readers to short the Mexican Peso against the US Dollar, based on The Donald’s plans to exclude Mexicans from US Territory with the aid of a Great Wall that Hadrian and many a Chinese emperor would be jealous of. I was in South Africa on the night of the election and set my alarm for 5am with a view to doing some profitable trading. I had been spreadbetting on the Dow Jones Index for awhile and so focussed my attention on the Dow, the pound/dollar exchange rate and the FTSE Index. I had two screens going and so much was happening at that stage I needed more screens and more hands. It was rapidly becoming apparent that Trump was going to do it and the Futures markets were going mental. You could literally sit there and watch your account going up by thousands of pounds every second. After a couple of hours I was up £160,000, but instead of resting on my laurels (I was aiming to make £300,000 and clear my overdraft in one go!), I kept betting and gradually saw my profit diminish as things went horribly wrong. A couple of weeks later, I remembered about the Peso. It’s quite an obscure currency exchange and not an easy one to find on the platform I use. Stupidly……I hadn’t sussed it out before the event and at 5 in the morning I was too dosey and things were just happening too fast to find it. When I looked back on it, I realised that the Peso had dropped over 20,000 points against the dollar in a matter of a couple of hours . Typically, I was betting about £10 a point then, although I might have started a bit lower. I would undoubtedly have upped the ante as it became apparent what was happening. I could potentially have made at least £500,000 that night and with luck it might have been double that. I probably think about that as often as Ronald Wayne recalls his “Sell” order on that fateful day in April 1976.
There’s a very good chance that there will be similar opportunities in the next Presidential election in November, assuming that Joe Biden hasn’t been whisked off to a sanatorium and Trump hasn’t found himself on the wrong end of an assassin’s bullet. With the completely bonkers state of American politics, not to mention wider society, it’s amazing that somebody hasn’t at least tried it already. For the record, I wish neither man any ill will, there are enough people in America fulfilling that role.
Meanwhile the markets continue to baffle and bemuse. How long will it be before the massively inflated tech bubble finally bursts? The result of that Presidential election could have a huge impact….especially if it’s President Biden in the White House.
As John Wayne might have said. “thess Injuns in them thar hills”.
ADayInTheStrifeOf 