Archives of “January 8, 2019” day

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17 stupid statements bulls make to deny a bear recession

  
Analysis, Education
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March 1999: Harry S. Dent, author of “The Roaring 2000s.” “There has been a paradigm shift.” The New Economy arrived, this time really is different.

October 1999: James Glassman, author, “Dow 36,000.” “What is dangerous is for Americans not to be in the market. We’re going to reach a point where stocks are correctly priced … it’s not a bubble … The stock market is undervalued.”

August 1999: Charles Kadlec, author, “Dow 100,000.” “The DJIA will reach 100,000 in 2020 after “two decades of above-average economic growth with price stability.”

December 1999: Joseph Battipaglia, market analyst. “Some fear a burst Internet bubble, but our analysis shows that Internet companies … carry expected long-term growth rates twice other rapidly growing segments within tech.”

December 1999: Larry Wachtel, Prudential. “Most of these stocks are reasonably priced. There’s no reason for them to correct violently in the year 2000.” Nasdaq lost over 50%.

December 1999: Ralph Acampora, Prudential Securities. “I’m not saying this is a straight line up. … I’m saying any kind of declines, buy them!”

February 2000: Larry Kudlow, CNBC host. “This correction will run its course until the middle of the year. Then things will pick up again, because not even Greenspan can stop the Internet economy.” He’s still hosting his own cable show. (more…)

40 steps in the Traders Journey

  
  Education
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They are as follows:

  1. We accumulate information, we learn- buying books, asking questions, maybe going to seminars and researching what really works in trading.
  2. We begin to trade with our ‘new’  found knowledge.
  3. We make profits only to give it back very quickly and then realize we may need more knowledge or information.
  4. We accumulate more information.
  5. We switch the stocks we are currently following and trading.
  6. We go back into the market and trade with our better system. this time it will work.
  7. We lose even more money and begin to lose of confidence that we can even be traders. The reality of losing money sets in.
  8. We start to listen to other traders and what works for them.
  9. We go back into the market and continue to lose more money.
  10. We completely switch our style and method.
  11. We search for more information.
  12. We go back into the market and start to see a little progress.
  13. We get ‘over-confident’ in a single trade and put on a big position believing it is a sure thing and the market quickly takes our money.
  14. We start to understand that trading successfully is going to take more time and more knowledge than we ever anticipated. MOST PEOPLE WILL GIVE UP AT THIS POINT, AS THEY REALIZE WORK IS INVOLVED.
  15. We get serious and start concentrating on learning a ‘real’ methodology.
  16. We trade our methodology with some success, but realize that something is missing.
  17. We begin to understand the need for having rules to apply our methodology.
  18. We take a sabbatical from trading to develop and research our trading rules.
  19. We start trading again, this time with rules and find some success, but over all we still hesitate when we execute.
  20. We add, subtract and modify rules as we see a need to be more proficient with our rules. (more…)

Traits of Livermore That Fueled His Success

  
  Education
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You know, and I know that human nature is like the leopard that can’t change his spots. Even armed with all the latest findings into the inner workings of our psyche, it seems to provide scant help-certainly when we need it the most. I don’t know about you, but it seems like a lot of people are crying foul when it comes to the market-like it’s a rigged game. I asked Jesse about that issue:

“Get the slips of the financial news agencies any day and it will surprise you to see how many statements of an implied semi-official nature they print. The authority is some “leading insider’ or a “prominent director” or “a high official” or “someone in authority” who presumably knows what he is talking about…Quite apart from the intelligent study of speculation everywhere the trader must consider certain facts in connection with the game in Wall Street. In addition to trying to determine how to make money one must also try to keep from losing money. It is almost as important to know what not to do as to know what should be done. It is therefore well to remember that manipulation of some sort enters into practically all advances in individual stocks and that such advances are engineered by insiders with one object in view and one only and that is to sell at the best profit possible.”

So, is it not true that the more things change, the more they remain the same? What about all the talk about the retail investor leaving the market for good-because it’s not a level playing field? Do they not detest their own gullibility? Again, from Livermore: (more…)

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