Sunday, October 30, 2011

Be "One" With The Markets

I've always been asked how is that I can see things others cannot see, or refuse to see? How is it that I know what's going to happen, just before it happens? I use what I call "market meditation".

When it comes to investing, I'm a fundamentalist. It's hard to argue with the math.

But, years of experience have also taught me to think for myself, trust my instinct and intuition, and to have faith in my own abilities. People move the markets, and I have this keen ability to understand people's fears and motivations, and to correctly gauge how they will react based on their beliefs and perceptions. As such, this ability allows me to "be one with the markets".

But, people always want concrete answers for things that can't easily be explained.

Unfortunately, the only way I know how to explain my continual success is that - when you cease to strive to understand irrational markets, then you will know - without understanding.

Friday, October 28, 2011

The Future Of Banking

Cashless from Naked Emperor Productions on Vimeo.

Are You Being Played Again?

I've been reading more and more manipulative reports lately in the financial media, attempting to shift blame for this economic crisis onto the gullible rubes who bought homes at, or near, the peak of the housing bubble. It seems as though the people in these reports are saying "you bought the bag of goods we were selling, so it's your current debt, your unemployment, and your inability to qualify for even more debt that's perpetuating the problem."

That's right, it's not the people who encouraged you to apply for a mortgage they knew you couldn't possibly afford, told you that a $100,000.00 home was really worth $500,000.00 and appraised it as such, loaned you 100% (or more) of the home price knowing that taxpayers would be stuck paying the bill if you defaulted, and then packaged these fraudulent loans and sold them to gullible investors as "safe" investments.

It's YOUR FAULT for not seeing through their criminal enterprise.

Be a critical reader folks and you'll see that what I'm saying is correct. Underwater homeowners are being blamed more and more for current economic conditions. Unbelievably, the perpetrators of this historic financial crisis are now blaming your debt for their crimes. It's almost as though the victims of these crimes are now being considered the perpetrators.

Do I really need to say that it's not your fault? For goodness sake, don't be played AGAIN!

The REAL perpetrators want you to forget that the actual cause of our economic crisis stems from fraudulent financial derivatives created by Wall Street, corrupt politicians, crooked mortgage lenders, and an unethical real estate industry, all of whom exploited your foolish gullibility.. and freely continue to do so to this day.

So, I'm posting this seminal investigation of the real causes behind this economic crisis, conducted by the unerringly ethical investigative reporters at PBS FRONTLINE.

This way you can decide for yourself if our current economic problems are truly your fault.

Source: PBS Frontline, The Warning.

Wednesday, October 26, 2011

The Instability of Inequality

Do you ever get that feeling that you know something is fundamentally wrong but you just can't fully put your finger on it, or express exactly what's bothering you? That's often my case.

So, when I read Nouriel Roubini's commentary, The Instability of Inequality, on Project Syndicate, I realized that what he says almost expresses how I feel about our economic turmoil and the Occupy Wall Street movement. As excerpted from this article, Roubini says -
Even before the Great Depression, Europe’s enlightened “bourgeois” classes recognized that, to avoid revolution, workers’ rights needed to be protected, wage and labor conditions improved, and a welfare state created to redistribute wealth and finance public goods – education, health care, and a social safety net. The push towards a modern welfare state accelerated after the Great Depression, when the state took on the responsibility for macroeconomic stabilization – a role that required the maintenance of a large middle class by widening the provision of public goods through progressive taxation of incomes and wealth and fostering economic opportunity for all.
When you read the full article, you'll see that Roubini is a very intelligent economist whose insights cut right to the point. He's pointed out the specific problems, and I'm sure he's also prepared an economic model designed to address those problems (for a fee of course).

But, as often happens, ivory tower solutions are often based upon altruistic ideals. We tend to think that people who are elected, appointed, or otherwise paid to address these situations will always act on behalf of Americans as a whole, instead of acting upon their own personal agendas.

To me, that's the crux of the problem. America was already operating on a great economic model that was created from the ashes of The Great Depression. We didn't need to create a new model to replace it, what we needed was enforcement of our old model. All economic models will fail if the rules of those models aren't enforced.

And there's the rub. How do you create a functioning economic model when the people running the show don't want it? The people in charge of enforcing our previously functioning economic model weren't altruistic. They pursued their own individual agendas instead of watching out for our country collectively, and allowed that model to become "legally" corrupted in order to serve their own needs.

And, what's sad to me is that I don't believe that there are enough altruistic people left to change the status quo. I think many Americans have already lost faith in our leaders to do what's best for the country, regardless of their political affiliations. Personally, I don't see things changing anytime soon.

I mean, even the man who was elected on the basis of hope and change seems to be pursuing his own individual agenda. But, don't take my word for it, see for yourself -

Tuesday, October 25, 2011

Happy Halloween Traders

It's easy to get squashed when people are running scared. Always expect the unexpected and you'll never be disappointed when short-term market movements don't go your way.

Thursday, October 20, 2011

"Mini-Madoff" Guilty Of $400 Million Ponzi Scheme

Wolfman Jack doppelgänger Nicholas Cosmo, 40, owner of Agape World Inc and Agape Merchant Advance, was sentenced to 25 years in prison earlier this month after admitting to stealing more than $195 million from thousands of investors in the course of a five-year, $400-million Ponzi scheme.

I'm mentioning this one specific Ponzi scheme because unlike many of Madoff's victims, who were well-off socialites, charities or corporations, Cosmo and Agape preyed on working-class families, U.S. service-persons and others who wound up losing all or part of their life savings. I can identify with this group of citizens and sympathize with the hardships that they'll now have to endure.

I'm also mentioning it because this is not the first time Cosmo has perpetrated such a crime, and served prison time for it. Personally, I think Cosmo should have gotten a life sentence since he's already proven his propensity for recidivism. I don't think the man is capable of remorse and could care less about the victims of his crimes.

But, his lawyers have argued differently and say he's sorry for what he's done. As a matter of fact, I've been given this alleged audio tape of Cosmo and his cohorts discussing their crimes while on the run from the law, and hiding out on a ranch in the southwest. What do you think?

Sunday, October 16, 2011

Occupy Phoenix

An offshoot of the Occupy Wall Street movement that began last month in New York City, more than a thousand people packed Cesar Chavez Plaza in downtown Phoenix on Saturday to protest what many view as a government operating in cahoots with the major corporations.

Occupy Phoenix Protests Corporatocracy
Image source: Mike Harris, 5 News

The reason I'm mentioning it is because the "Occupy" protesters are often labeled in general as being hippies, wackos, lazy bums, disgruntled homeless, or as some other derogatory term, perhaps used in order to reduce their credibility.

But, if you look closer at the Occupy Phoenix protesters, there seems to be many who look just like you and me, the typical average American, and don't fit into those derogatory categories often used to characterized the Occupy Wall Street protesters. The two ladies pictured above look more than capable enough to me to be able to express just what it is that bothers them, and bothers me too.

Now, I do have to agree with "Occupy" detractors that this movement doesn't really have any defined leadership, clear-cut solutions, or a plan in place designed to fix things. I think that it's more of an expression of dissatisfaction and disillusionment than anything else. I'm also of the opinion that the system is too corrupt to change, and that changing it by civil protest is likely impossible.

However, anyone who's experienced the civil unrest of the 1960s and 1970s can tell you that these types of protests have a way of gaining momentum, and shouldn't be dismissed lightly by those running the show. People don't tolerate injustices for very long - one thing could lead to another.

Friday, October 14, 2011

Weekly Wrap

What happened in only two weeks to make market sentiment reverse course so sharply? Absolutely nothing but financial media manipulation and the market "experts" calling it wrong again.

The markets didn't plunge, recessionary fears calmed, and economic data came in better than expected. The past two weeks saw the Dow and Nasdaq climb back into positive territory for the year, up 6.6% and 10.2% respectively, and the S&P 500 rise 7.2% in the same time period.

My stock pick position in KND is back in the black after being initially "Ganned", and if anyone would have entered a position in DEG when I mentioned it, it would have been good for a ten-point gain.

So, it looks like my forecast was right on the mark, so far. But, like I said, the market is like a fickle woman, and can turn on a dime if she doesn't like what she hears. All in all, it was a pretty good two weeks. If breaking through resistance means anything, then next week should likely follow suit.

But don't just take my word for it, see what these technical analysts reported on Friday.

Tuesday, October 11, 2011

Occupy Wall Street Recruitment Video

This Occupy Wall Street movement that's been in the news lately is really gaining momentum, and has now extended itself to other major cities throughout America, even out in California.

Personally, I'm not sure what to make of these protests. Although I can sympathize with their cause, I'm not so sure that they have a good enough plan in place to achieve their vague objectives. It seems to me to be more of a "bitch session" than a radical movement for changing a corrupt system.

But, I guess it doesn't matter what I think anyway, because more and more people are joining the movement daily. I'm sure that a lot of Americans are angry and fed up with white-collar crime and corruption affecting our economy, but I've also been wondering how Occupy Wall Street has been getting such vast numbers of people to join their protests.

That is, until I received this recruitment video in an email today.

Monday, October 10, 2011

Monday, October 3, 2011

A Contrarian Stock Market Viewpoint

If you're cynical enough to believe that most people will do whatever is in their own best interests, and often at the expense of others, then you'll come to understand that almost everything happens for a reason instead of by chance.

Take the past week's stock market action for example. The two main emotions that usually dictate investors' behaviors are greed and fear, and the short-term price of stocks is usually directly proportional to how investors react to these two emotions.

Right now, investors are freaking out and selling their investments out of fear. Either fear of economic collapse, fear of going broke, or just plain fear of the unknown. However, the bright side of this market bailout is that the panic has brought back one of my favorite dance crazes from the 1970s.

All kidding aside though, a good contrarian investor realizes that there's usually an ulterior motive behind all of this fear, and it likely has something to do with the evil forces of excessive greed - Wall Street, and their corporate and political cronies. They're deviously skilled at generating profits by manipulating the perception of fear, uncertainty, and creating market volatility.

As such, I see this pullback as cause for inversely celebrating good times. Instead of running with the herd and fleeing the markets like everyone else, I'm going to continue to do what the criminals are doing and use my cash position to invest in select stocks, ETFs, or funds while they're on sale.