Monday, September 05, 2005

Jacques Derrida and Wall Street

There's a big difference between a trade and an investment, right?


That's just a Wall Street mantra that needs to be uprooted.

Why is it that growth is associated with risky techs and semiconductors; why are buying shares of mega caps "not trades?"

I buy Home Depot (HD) -- America's 2nd largest retailer -- and pick up 3 quick points after the Katrina debacle -- did I trade or invest?

Can you "flip" stalwarts like HD, PNG, and KO?

The answer is yes.

"Value" and "Growth" are not opposites -- they're two sides of the same coin.

The bottom line is this: the trader/investor distinction makes little sense, if any at all.

Like good Derrideans (French philosopher Jacques Derrida was a former teacher of mine), we need to deconstruct Wall Street's most insidious binary.

Derrida, arguably one of the 20th century's most important philosophers, was concerned not so much with exposure of error but with an investigation into how we produce truth.

The contradictions of language were Derrida's silly putty.

If you stay in a position that no longer seems attractive just so you can stick to your philosophical guns and remain "value-oriented," the only thing you're doing is insuring your losses.

Capture gains as they come.

Pay the taxes.

And avoid dogma -- recalcitrance kills.

Dogma is for politics, not the Street.

Markets are fluid, mutable, and elastic beings -- our mentalities should mirror the same things we study.

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