MadMarketScientist

A few of us here are debating whether 'speculation' is useless, as it serves no useful function to society .With most "normal jobs' you produce either a product or a service. But the act of speculation produces nothing as it does not add anything useful to society. My thoughts are even though speculation seems to produce nothing, it is actually providing a means for other companies to provide products and jobs, like the brokers, software vendors, etc. And then we can add all the taxes we pay. So bottom line, because we speculate non-speculators does benefit. Tell me what you think? MMS

Well the market is focused on Greece now. The crisis will play out one of two ways, Greece could reject the proposed austerity cuts, default on its debt,and destroy the European Union and the euro. Or, the more likely scenario, major holders of Greek debt (the European banks) will "extend and pretend" and roll over their Greek debt. The French banks already rolled over about $30 billion of Greek debt. And we all know "extending and pretending" debts doesn't change any of the fundamental issues. MMS

Business Talk Radio host Gabriel Wisdom recently spoke with Pete Kendall, Co-Editor of EWI's Elliott Wave Financial Forecast. Their discussion included a crucial but rarely asked question about economists and the Federal Reserve. Here's the relevant excerpt: Gabriel Wisdom: "Ben Bernanke, the chairman of the Federal Reserve, says the economy is slowing but there's faster growth ahead. Is he wrong?" Pete Kendall: "Economists are extrapolationists. They tend to look at what's happening in the economy and extrapolate that forward. So here we have a situation where not just Bernanke but economists in general are looking at... what they call the 'soft patch' and somehow contorting that into growth later in the year. Pete's startling reply flatly contradicts conventional wisdom. Most people believe that the Fed really is able to anticipate the economic future. After all, they're the most "qualified." But what do the facts say? Pete's Elliott Wave Financial Forecast Co-Editor Steve Hochberg recently included this eye-opening chart (from Societe Generale Equity Research) in his new subscriber-exclusive video, "Buy and Hold, or Sell and Fold: Where Are The Markets Headed in 2011?" The red line in the chart is the S&P earnings, and the black line shows economists' forecasts relative to those earnings. Here's what James Montier, head of equity research for Societe Generale, said about it: "The chart makes it transparently obvious that analysts lag reality. They only change their minds when there is irrefutable proof they were wrong, and then only change their minds very slowly." (emphasis added) That comment is spot-on. In 2002-2003, as you can see, earnings turned up despite economists' forecasts for earning declines. It took them a while to "turn the ship around" and play catch-up with the trend. Yet in 2007-2008, earnings turned down -- despite the forecast by economists for continued increases. The devastating truth is that earnings did more than fall in the first quarter of 2008: they had their first negative quarter in the history of the S&P. As Steve said in his subscriber video, "Economists were wrong to a record degree" -- and investors felt the pain. So what's the point? Economists do extrapolate the trend. That approach works fine, until it doesn't* -- and you're on the hook. Elliott wave analysis never extrapolates trends -- it anticipates them. The Wave Principle recognizes that markets must rise and fall -- and that they unfold according to changes in investor psychology, in a way that is patterned and recognizable. Most people believe that the Fed really is able to anticipate the economic future. Now you know the facts. Uncover other important myths and misconceptions about the economy and the markets by reading Market Myths Exposed. This article was syndicated by Elliott Wave International and was originally published under the headline Can the Fed and Economists Forecast the Future? See This Startling Chart.. EWI is the world's largest market forecasting firm. Its staff of full-time analysts led by Chartered Market Technician Robert Prechter provides 24-hour-a-day market analysis to institutional and private investors around the world.

Thanks SUIYA for this note - I think we've had enough of this for one weekend, don't you all think ... let me have the last word here. Its a start of a new week so let's all go and make some money in the markets!! :missy: MMS

Hi - I just added "Subscribed Threads" button below the main nav, that should give you what you want. thanks for feedback MMS

Both re-enabled - thx for feedback MMS

Guys - just take the high road ... and let's move onto something else :missy: (<--that's me getting drunk) MMS

Haha sure thing ... maybe I'll change my nick and add the "v2" to it Believe me I don't want to spend my time censoring people's posts! But when the discussions turn away from the original thread topic and degenerate into name calling and recalling of past grudges ... like this thread has ... can't we just all get along MMS

Yup I love the omaha games, too bad they are getting harder and harder to find, at least where I'm from. Because of TV its all guys playing 1-2 or 2-4 no limit with $200 in front of them ... such a boring game for me. I was actually referring to being run over with KK or AA in hold-em. Can't fall in love with you hand, I have to remind myself that when I look down at a big pair. Yes I get down to vegas once a year or so, love the Bellagio room. The action and atmosphere is amazing ... red bulls and 15-30 all day! I haven't read your book (thats pretty cool) but I'll check it out MMS

Ok guys we are getting out of hand again. Can we stay on topic please? This thread had some good debate going but we are degenerating back into personal attacks so let's not head down that road. Thales - I assure you there are no paid vendors on TL getting special treatment. I also encourage good debate on TL and if you ever feel like someone is getting preferential treatment come speak with me about it ok? MightyMouse\steve46 - yes you can criticize the criticizer - but only his ideas, posts, articles ... but not him personally ok? After you've all read this I want to delete these posts as they are distracting away from the original thread ... as others have mentioned (bobcollett) good threads can do without the noise. Thanks everyone - let's keep TL a place people want to come to. MMS

Wow 1/3 women - that surprises me. If I were to guess I would have thought at most 15%. No worries on the reply time we all have lives outside TL (right?) MMS

What scalper software? MMS

Yes poker and trading are so similar its uncanny. Patience, wait for the right setup, and bet aggressively when the opportunity arises. Smalls losses and big winners. That's why I prefer Omaha to Hold'em, bigger pots, less patient people playing hands they shouldn't, and BIGGER pots. But if I had a dollar for every time I busted out with rockets or cowboys ... MMS

Yes I'm not happy about the poker laws either. Why don't they just legalize it and rake in the billions in taxes? I love playing poker but playing in a casino is so slow and too much of a grind for me most days. Too many wanna-be pros waiting for AK. Although sometimes I find a loose game Omaha game where I can pick up a quick hundred or so. MMS

steve46, out of curiosity, what is the men\women ratio? thanks, MMS

Tams and his famous sarcasm again! MMS

Even worse he will probably disappear ... he has no idea what he is going up against! MMS

This whole idea is around the fact that during these off-hours, things should not be happening ... so if something does, then there is an opportunity. So if the mini-dow is less liquid, I would think this theory applies even more to it. A potential problem might be that these occurrences probably happen even less. Watch the seminar, they walk through setting the whole backtest up in Ninja. MMS

carltonp - No question is dumb, here is more info about the webinar I was talking about. "Join Greg Adams, founder of Trade Coach, for this webinar event exploring how the E-mini SP500 price action behaves itself at 11:00 pm, midnight and 1:00 am in the morning. If trading in the middle of the night is not for you, Greg will provide detailed information on how to automate your trading plan so you do not have to be around your computer when the trading opportunity you are after arises. The ES is the most liquid E-mini futures contract open 23.25 hours a day, 5 days a week. Midnight in the US is an interesting time because, in theory, not much should be going on with the ES contract at that time. In Australia, it is early afternoon, Asia is starting to wrap things up, and Europe has not yet opened. However, sometimes there is plenty going on at this time as this webinar examines." Archived Trading Webinars | Mirus Futures MMS

I was watching a Mirus\Ninja webinar about strategies for trading around midnight EST. The idea was there is so little activity that if prices get outside of a range (bollinger bands), it made good entry points as the price would revert back to the mean very quickly . They backtested and it 'appeared' to work but not very often, maybe once every other week or so only. MMS

I was listening to a Mirus\Ninja webinar today and one of the slides said women are MUCH more profitable then men at trading! An interesting slide, I wonder if its true or if its just a sampling thing where MANY more men 'give it a go' and these losers bring down the average? MMS

Funny you said that, I was listening to a Mirus\Ninja webinar today and one of the slides said women are MUCH more profitable then men at trading! An interesting topic for a new thread I think ... MMS

Let’s face it – most people don’t know when to sell a falling stock. So they’re frozen into inactivity, saying, “Should I just keep holding and hoping, or should I cut my losses now?” This state of indecision is usually permanent, and often continues until you hear the all too familiar phrase, “well, it’s too late to sell now.” One of my good friends lost it all following the “it’s too late to sell now” principle. He bought a ton of shares in a cable company based on his friend’s recommendation that it was supposed to take over the world. The shares soon tumbled in half, and his friend, who knows about the cable business, told him to buy more, so he did. The shares tumbled in half again, and he bought even more. He finally stopped buying when the shares hit a dollar a share. The shares eventually traded for pennies. After you’ve read today’s essay, if you follow the advice in here, your constant state of indecision will be gone. You’ll never lose another night’s sleep worrying about which way your investments will go tomorrow. Because, unlike most investors, you’ll have a plan – knowing when to get out, and when to stay in for the biggest possible profits. Buying stocks is easy. There are thousands of theories out there for why and when to buy. But buying is only the first half of the equation when it comes to making money. Nobody ever talks about the hard part – knowing when to sell. In order to invest successfully, you need to put as much thought into planning your exit strategy as you put into the research that motivates you to buy the investment in the first place. So please read closely here, and think about each point... How Do You Evaluate Businesses? In business and in stocks, you’ve got to have a plan and an exit strategy. When you have one, you know in advance exactly when you’re going to buy and sell. The strategy I’m going to show you will allow you to ride your winners all the way up, while minimizing the damage your losers can do. But before I get into the specific strategy, consider this business example... Let’s say you’re in the tee-shirt business. You’ve made a ton of money on a tee-shirt business in the States, and you’re now in the Bahamas looking for new opportunities. You size up the market, and you figure you can make money in two markets: in golf shirts, geared at the businessman, and in muscle-tees, geared toward the vacationing beach-goers. These are two products clearly aimed at two different markets. You invest $100,000 in each of these businesses. At the end of the first year, your golf shirts are already showing a profit of $20,000. But the muscle-tees haven’t caught on yet, and you’ve got a loss of $20,000. There are numerous reasons why this is possible, so you make some changes in your designs and marketing and continue for another year. In the second year the same thing happens – you make another $20,000 on your golf shirts, and you lose another $20,000 on your muscle-tees. After two years, the golf shirt business is clearly succeeding, and the muscle shirt business is clearly failing. Now let’s say you’re ready to invest another $100,000 in one of these businesses. Which one business do you put your money into? The answer should be obvious. You, as a business owner, put more money toward your successful businesses. But as you’ll see, this is the opposite of what 99% of individual investors in America do... How Do You Evaluate Stocks? Let me start by asking you a question – what does “owning shares of stock” actually mean? This isn’t a trick question – as you know, it means you’re a partial owner of the company, just like you’re the owner of the tee-shirt company in this example. Owning your own business isn’t fundamentally any different than owning a share of a business through stock. However, most people treat them exactly the opposite... Let’s say the shares of your two tee-shirt companies trade on the stock exchange. They both start trading at $10 a share. At the end of the first year, the profitable golf-shirt company is trading for $12 a share, and the unprofitable muscle-shirt company is trading for $8 a share. At the end of the second year, the golf shirt company is trading at $14, while the muscle shirt company is trading at $6 a share. Which shares would you rather own? Even though you know you should buy the winning concept based on the business example, most investors don’t do so in their stock investments. They keep throwing good money after bad hoping for a turnaround. They buy the loser. The Trailing Stop Strategy In stocks (and in business, I believe), you must have and use an exit strategy – one that makes you methodically cut your losses and let your winners ride. If you follow this rule, you have the best chance of outperforming the markets. If you don’t, your retirement is in trouble. The exit strategy I advocate is simple. I ride my stocks as high as I can, but if they head for a crash, I have my exit strategy in place to protect me from damage. Though I have many reasons I could sell a stock, if my reasons don’t appear before the crash, the Trailing Stop Strategy is my last ditch measure to save my hard-earned dollars. And it works. The main element to the Trailing Stop Strategy is the 25% rule. This is where I will sell any and all positions at 25% off their highs. For example, if I buy a stock at $50, and it rises to $100, when do I sell it? If it closes below $75 – no matter what. Don’t Let Your Losers Become Big Losers So with my Trailing Stop Strategy, when would I have gotten out of the failing muscle-shirt business? You already know the answer. Remember, the shares started at $10 and fell immediately. Instead of waiting around until they fell to $6 as the business faltered, using my 25% Trailing Stop, I would have sold out at $7.50. And think of it this way – if the shares fall to $8, you’re only asking for a 25% gain to get back to where they started. But if the shares fell to $5, you’re asking for a dog of a stock to rise 100%. This only happens once in a blue moon – not good odds! Take a look at how hard it is to get back to break even after a big loss... You’ll Never Recover Percent fall in share price Percent gain required to get you back to even 10% 11% 20% 25% 25% 33% 50% 100% 75% 300% 90% 900% So what’s so magical about the 25% number? Nothing in particular – it’s the discipline that matters. Many professional traders actually use much tighter stops. Ultimately, the point is that you never want to be in the position where a stock has fallen by 50% or more. This means that stock has to rise by 100% or more just to get you back to where it was when you bought it. By using this Trailing Stop Strategy, chances are you’ll never be in this position again. This article syndicated from Steve Sjuggerud's Daily Wealth

Oh MM!! :haha:

Yes I think some stocks like Walmart, Philip Morris, P&G are good inflation-defensive stocks as they can pass these onto their customers and pay a decent dividend. I'm also looking at buying real-estate and MOST importantly getting a fixed interest mortgage in US dollars. MMS