Archives of “January 5, 2019” day

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Greece in last-minute talks on austerity cuts

  
Analysis, Education
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Greek premier Lucas Papademos held last-minute talks on Sunday with international lenders on wage and pension cuts amid fears that political leaders may reject a second €130bn bail-out and plunge the country into a chaotic default.

Evangelos Venizelos, finance minister, said “It’s not an impasse but there are problems for the Greek side” over terms of a medium-term package being negotiated with the so-called “troika” – representatives of the European Commission, European Central Bank and International Monetary Fund.

The two sides were “quite far apart” over projected cuts of 25 per cent in private sector wages, 35 per cent in supplementary pensions and the immediate closure of about 100 state-controlled organisations with thousands of job losses, a Greek official said.

Mr Papademos held telephone conversations on Sunday with Christine Lagarde, IMF managing director and Mario Draghi, ECB president, in a bid to break the deadlock, the official added.

The three leaders of Greece’s national unity government were due to meet Mr Papademos later on Sunday to agree the package before it goes to eurozone finance ministers for approval next week.

It was not clear whether former socialist premier George Papandreou and Antonis Samaras, the conservative leader bidding to succeed him, would also meet the troika mission chiefs. (more…)

10 Lessons

  
  Education
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1. Markets tend to return to the mean over time.
2. Excesses in one direction will lead to an opposite excess in the other direction.
3. There are no new eras – excesses are never permanent.
4. Exponential rising and falling markets usually go further than you think.
5. The public buys the most at the top and the least at the bottom.
6. Fear and greed are stronger than long-term resolve.
7. Markets are strongest when they are broad and weakest when they narrow to a
handful of blue-chips.
8. Bear markets have three stages.
9. When all the experts and forecasts agree – something else is going to happen.
10. Bull markets are more fun than bear markets.

Do you want to reach PEAK PERFORMANCE in your trading?

  
  Education
In “Super Trader”, Van K. Tharp writes that there are 5 Steps to Consistent Profits/Peak Performance:
1. Work on Yourself.
– Personal beliefs about yourself (strengths & weaknesses)
– Market beliefs
2. Develop a Business Plan as a working document to guide your trading.
– Work on yourself (see above)
– Understanding the big picture influencing the markets you trade
– Markets, instruments and timeframes you will trade
– What are your daily procedures?
– What is your personal education plan?
3. Develop Several Strategies that fit your view of the big picture and understand how each of them will perform in various market types.
– Develop a trading system that fits each market type you plan to trade that fits you
– Technical vs fundamental?
– Trend following vs scalping?
– Entries
– Exits
4. Thoroughly understand your objectives and develop a position sizing strategy to meet them.
– Position sizing models
– R-multiples
5. Monitor yourself constantly and minimize the number of mistakes you make.
– KISS
– Are you following your rules?

Ten Key Principles in Economics

  
Analysis, Education
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ASR-10Everything has a cost. There is no free lunch. There is always a trade-off.Cost is what you give up to get something. In particular, opportunity cost is cost of the tradeoff.

 

One More. Rational people make decisions on the basis of the cost of one more unit (of consumption, of investment, of labor hour, etc.).

iNcentives work. People respond to incentives.

Open for trade. Trade can make all parties better off.

Markets Rock! Usually, markets are the best way to allocate scarce resources between producers and consumers.

Intervention in free markets is sometimes needed. (But watch out for the law of unintended effects!)

Concentrate on productivity. A country’s standard of living depends on how productive its economy is.

Sloshing in money leads to higher prices. Inflation is caused by excessive money supply.

PANIC BUTTON

  
  Education
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press-panic

I think every trader should have a panic button in their mind. What does it mean? When the trend changes, traders should get out of the previous bets right away, even though some of the charts look still favorable to the previous trend. Lock in the profit or take the loss, just get out. The sooner the better.
I conclude this is a “must have” technique in a trading friendly market, like what we are in right now.

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