Miscellaneous Ramblings on a Monday Morning

I’m finally slowing up for the season and getting a little more free time (as my friends are noticing because I’m texting and emails more often lately).  Here are a few things that have been running through my head over the last week

1. Some people think we have to pick sides of either Chinese short domains or keyword.  I’ve always felt you can buy and sell both.  Taking advantage of the liquid and quick price movements of short domains and the long term investment potential of keywords. I talk a lot more about short names simply because those are the names coming up for auction and the names that are getting the best prices.  I talk about what is hot.  Doesn’t mean I think other things are bad.

2. How hard is it to convert price reports to US dollars?  I know domain articles are read by people all over the world but I guarantee 90% of the readers understand USD better than RMB.   Just because the Chinese market is the driver doesn’t mean you have to list all the sales and average prices in their currency.  The price reports are awesome but the writers can save the readers from having to get the calculator out.  365,000 RMB sounds awesome but $56,300 is a better comp for me.   Or put both if you want to appeal to everyone.  People will call me lazy but I know there are many readers besides me that would appreciate it

3.  How many years in a row do prices have to climb in numerics and short domains in a row for people to stop calling it insane? And unless you have skin in the game what good does it do to call the people buying the longer short domains and alternative tld domains stupid?  I have seen more “this doesn’t make sense and is going to crash” comments in the blogs than I’ve ever seen.  Meanwhile the people in the forums in Namepros are busy trying to figure out their next moves.  To me the latter seems a more intelligent approach.   Sure, the buyouts are unexpected and massive, but to me its nothing but exciting. I don’t even own any domains in most of them but I still love the thought of the money coming in.  As a trader you learn quickly that making money is about the flow of money in and out.  THAT is what you follow.  You never saw anyone making fun of a guy buying an option on oil at a 100 strike when it was trading at 30.  It was a gamble and a crazy purchase,  but it was his money and his money to make or lose.  We didn’t go up to him and say “Hey Charlie, I want to remind you that the option you purchased has a big chance of being absolutely worthless”  No.  We were grown men and knew the risks.  Now we all need to be protected from the big bad marketing writers.

4.  I hope you’re enjoying Ike’s writeups each day in the Daily Recap. I know I have.  He has a completely different approach than Aaron and I and the result is that he probably has made more money that Aaron and I have.  He is much more risky than the average investor but that risk has paid off for him. He has a huge portfolio of numerics and short letter dot coms that he has been able to sell off $25K quickly when needed and take it out like an ATM.   I giggle when I see the naive make fun of his .xyz purchases and “odd” combos, and alternative tlds. They have no idea how much money he’s made doing the same thing over the last few years and could buy thousands of losers and still have done well.  There are a lot of ways to skin a cat and I’ve really enjoyed watching him skin cats.

5.  Mike Berkens and a few others in the comments have talked about Chinese buying English words.  Chinese investors don’t seem to care what they buy as long as they feel its going to make money.  They are investing billions in American and Canadian real estate. Some of it just sits empty.  Talk about no end users. Ask some people in Toronto if the Chinese buyers are looking for rental income?  And look at the names they bought at the last auction.  House.com, Banana.com, Girl.com   Only some of the most common phrases in all the English language.  If they start buying names like dronerepairpatches.com then I’ll start paying attention.

6.  I’ll go ahead and congratulate Richard Lau.  I thought he had really done something with last year’s Namescon success but this year is going to be off the charts.  EVERYONE is coming to NamesCon.  There are people from all over the world coming this year. People that would never would have come to a show are coming.  The auction is having real money flying in to bid.  It will be the best networking event in the history of domain investing.  Those who have the opportunity to attend will be a better domain investor or domain company for being there.  And this all because of the dreams and work of Richard Lau and team.

7. And most prophetic post I’ve read is this one from Jon on Elliot’s blog in September 2013

“If Chinese start viewing domains as a real investable asset, all inventory of all the best numeric and non-numeric domains will be taken out in one quick swoop. There is so little of investment-quality inventory, less than a $ billion will probably take everything out. If that does happen, we will see some really crazy price increases”

8. People need to quit calling tops to markets. Almost everyone has been wrong on every call. Even the best and the brightest make the mistake.  Like Elliot’s post earlier in May of 2013.

“if you are buying them (numerics) now, you’re buying at the top of the market. That market may improve over time, but it’s considerable risk to be buying at the top of the market”