Someone once made the point that power corrupts and that absolute power corrupts absolutely. In order to protect the investing-speculating public from being manipulated and abused by this smiling, red-suspendered beast in pinstripes, we probably need volumes of better regulations and an encyclopedia of less self-serving rules of behavior. But as unlikely as it is that meaningful change will happen anytime soon, we need to educate the investing public about how they should interact with those conspiring to separate them from their money. It is this conspiracy that really makes Wall Street tick.
– – – – – – – – – – – – – – – – – – – – – –
As you go through your daily routine, you will become totally aware of what has been happening in your territory. Today’s plan is ready for implementation. You can’t wait for the opening bell. But where are “they”? What do “they” recommend? What do “they” see happening? How do “they” explain what has been happening? Just who are “they” anyway?
You don’t need them anymore. You have become a “they.” No other opinion is relevant, considering how well trained you are in a discipline that just makes sense. Upon completion of your daily buy list, you are aware of the opportunities that may be out there today. The more buys there are, the better a 6-to-9-percent profit looks. This is it—profit-taking time. Time to pull the trigger.
At first, you may want a second opinion. You may have heard a good report or seen a favorable write-up. Merrill Lynch says it’s a $60 stock, and here you are thinking of selling at $52. Don’t be confused by Wall Street greed food. There are no facts, remember—only speculation and opinion. You really do know, however, that if you sell your XYZ Widget Ltd. at $52, not only will you have made money, but you already have identified several new opportunities for reinvestment of the proceeds. Pull the trigger and move on to the next opportunity.
– – – – – – – – – – – – – – – – – – – – – –
“The market went down today because there are just too many people employed. The strength of the economy is someday going to cause prices to go up. When that happens, inflation could become a problem, and the Fed will have to raise interest rates to slow things down.” Sound familiar? How about this one: “The market jumped up today, rejoicing over the increase in first-time jobless claims during the latest reporting month.”
This topsy-turvy kind of thinking is not going away anytime soon, and by now, I’m sure that you don’t want it to. It produces the day-to-day, month-to-month directional changes that make for successful trading. An irrational market that moves unpredictably and quickly in both directions is the easiest market environment to manage.
