Special thanks to Josh Brown (Reformed Broker) for reminding us that February 3rd was the anniversary of when the music died.


 


Sometimes I think I’m like that kid in “The Sixth Sense”.


“I see connections”. That’s not quite as spooky as seeing dead people, but just the same, some of the connections can be pretty tenuous and call reason into question.


Buddy Holly, not me in High School


In this case, though, the connection happens to be to a dead person who now appears very much alive, as Natalie King Cole has released paternal DNA testing indicating that Buddy Holly was her biological father and will soon be releasing a music video duet of “Oh Boy”.


But what in the world does Buddy Holly have to do with stocks, investing or the markets? So little, that if I didn’t bang out this blog right now, the moment the idea popped into my head, there is no reasonable way that I would remember the concept or connection 3 minutes from now.


It all started with a simple Tweet from Josh Brown, author of The Reformed Broker website.


I have no connection with him, in fact, I think he may have even blocked me from posting to his Twitter account, due to our onetime irreconciliable differences over Darfur.


But he pointed out a great Buddy Holly tribute album with lots of very impressive contributing artists. How could you not want a Buddy Holly song covered by Cee Lo Green?


Being who I am, I scanned the list of artists with one filter in mind, but the search turned up nothing. Maybe he was still with the rest of us sitting a very extending Shiva for Clarence Clemons.


That prompted me to dust off a couple of 35 year old concert venue renditions of Buddy Holly songs by Bruce Springsteen and then caused me to allegedely post links to them on this site.


I say “allegedly” because it may be against the law to have done something like that. Despite great admiration for both Springsteen and Holly, an equally prestigeous named law firm might pursue me for something.


Allegedly. Good luck finding them.


Anyway, Buddy Holly was truly an amazing guy. A walking and talking cultural contra-indication, he was a Texas Boy in the 50’s, playing to racially mixed audiences and performing with musicians who couldn’t get in the front door in many parts of the country. Interestingly, The Big Bopper also couldn’t get in because of his girth.


The fact that his wife’s name and that of my Sugar Momma are the same played no role in the strength of the connection.


Another of my favorites, Don McLean paid Buddy Holly homage, at the expense of Elvis. Entirely coincidentally, the blog “The First Time” from just a few days ago featured Roberta Flack, whose own song “Killing Him Softly” was a tribute to Don McLean.


As Kurt Vonnegut used to write, “And so it goes”.


Had I not seen Don McLean in concert the night before the SAT’s, maybe I would have had three Harvard degrees.That undergraduate degree would have taught me to never begin sentences with either the word “But” or “And”.


No regrets, though, as that is a recurring investing theme of mine.


I say that after having just lost Google to assignment, far below its Friday close. And then there was Visa and before that Green Mountain Coffee Roasters.


Okay, maybe some small regrets. Unfortunately, my vanishing memory banks can’t seem to erase those memories.


Buddy Holly showed that there were lots of different ways to break out of the stereotypical mold and create a new far-sighted and visionary path.


He also helped re-invent an entire musical genre, much like I will need to recreate my portfolio today, as nearly 40% has to be replaced due to assignment.


I didn’t need a plane crash to realize that there were alternatives to buy and hold, although, sometime this week, I will pay some tribute to a Buy and Hold guy (if I can remember).


It did, however, take the untimely death of my financial advisor, who when we first started our relationship, was still known as a “stock broker”. I discuss him at length in the Option to Profit book, which I obviously plug at every opportunity.


Today, I will be figuring out how to redeploy about 40% of my portfolio, following assignments of Freeport McMoran, Google, Halliburton, Sallie Mae, Rio Tinto, Transocean and maybe a few others.


I will likely buy back Sallie Mae, Transocean and Rio Tinto and follow through with the recommendations that I Tweeted on Friday afternoon regarding Sunoco and Time Warner, in addition to whatever else remains in or is added to the portfolio.


Of course, I’ll look to sell call options, always being satisfied in the 2-4% monthly gain per stock. Dividends, small capital gains and options premiums, whatever it takes to scratch out a respectable living.


In a way, it’s like the small venues that Buddy Holly played, because in his barely year of fame, he hadn’t yet gotten to the big times, which for Rock and Roll, hadn’t really come of age yet anyway.


Or as I like to look at opportunity costs, “You didn’t miss them anyway”.


He was obviously a risk taker and I am slowly getting into that frame of mind, at a time when the financial guys are saying that those of my age should “slow down”.


Anyway, I just read a short article that seemed to say that approaching retirement only 25% of holdings should be in equities and the rest in annuities.


Can you say “WTF” on the internet?


Would Buddy Holly put his money into annuities? Elvis maybe. The Jester? Never.


Screw annuities. Just to slow down that aging process and as a thumb in the eye of those thinking that I should be slowing down, I’ve started selling more and more put contracts. Even though I’ve done that for a few years now, as part of my less than 5% speculative piece, it was always with very low cost issues, like Citibank, Sirius and YRCW. Now I’m branching out, slowly working may way up the price chain with Harbin Energy, Yahoo and Spreadtrum Communications recently. Maybe Google next?


I don’t think so. I may see connections, but I’m not a lunatic.


But it is fun. It’s not what I’m supposed to be doing at this age, but it is all a frame of mind. And besides, that frame of mind is both figurative and literal. I love wearing the big glasses and checkered jacket. Probably the only person who will see me in my lucky trading garb will be Sugar Momma and the UPS guy.


Sugar Momma has been looking askance at me lately anyway as the last 3 or 4 texts I’ve sent her have mistakenly included the word “tit”, instead of “it”. Proof reading was never one of my strong suits, but coming on the heels of the blog entry, “How my WIfe’s Bra Saved us Money“, now she’s not so certain that those were simple auto-spell mistakes.


Although the UPS guy has learned not to ask me questions, I’m sure he’ll be able to hear the Buddy Holly tunes that will be streaming today and he’ll probably say something to the effect of “Man that’s so loud, I can barely even hear your annoying wiener dog barking”.


That was the whole point.


Today, as we start another options cycle, I’ll be replaying “That’ll be the day the Bear Market Died” all day long and thinking of all the connections that are so obviously there.


Don’t you see them?


 


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