Crap!!! and more Crap!!!Socialism, Inflation, and more self-doubt than a trechy at prom.

Once again hello all out there, Tony here and I must be completely honest right now. I'm a tiny bit disappointed in myself at the moment and am drowning my sorrows in a Coors Light.

As most of you might know Disney (DIS) reported yesterday and the had a great quarter. This is the reason for my personal frustration. I have to admit ladies and gents that I didn't take my own advice and missed out on about 4 points of the stock's upside. Most importantly, i missed out on a solid trade. Why? well i have to admit i went against my better judgement and for a second i listened to all those bears and got spooked out of my trade in DIS. Turning on the TV the only thing i heard back in JULY was the rise in gas price. The rise in gas. the world is coming to an end and the only thing left will be cockroaches and high gas prices.

Financial media sounds to me more like evangelical Christians. "REPENT THE END IS NEAR, YOUR LIFE OF GLUTTONY IN THE FORM OF THE CDO OR MOBS WILL BE ARMAGEDDON!!!!" they paint oil companies like demons who hoard oil and short sellers the horseman of the Apocalypse.

And like i said for about a week in July i bought into the hype and broke 2 of my cardinal rules of investing.
The first being, i turned on the TV and listened to some guy on the screen. If at all possible never do this, it will be your down fall. Sure there are some guys out there in financial media land that i really like, but none of them have there own shows and the ones that do, save their good info for their email newsletters. So, the scare tactics worked on me and i convinced myself that high gas prices would severely hurt Disney's theme park attendance...and i was wrong. The lesson is: People will always take a vacation, but in this climate they will drive not fly to their destination. So the trade is wait for gas to come back to 120$ a barrel and by the OIL ETFs or Rio Tinto or something that backs off when gas gets low, because the drop in prices is always temporary. Let's face it, we are running out oil. and the Olympics is the wild card to place a strain on supply. No one talk about the Olympics and what effect it will have on the world economy.

My second mistake was that i did not treat my i investment like its own investment. Meaning, when i looked at Disney i lumped it together with a horrible trade i made last year into Six Flags another theme park. Again i listened to the old TV and bought Six Flags on a recommendation and lost almost 30% immediately. I hate loosing money. So i was admittedly gun shy of putting my money into another theme park. The lesson: as investors you have to look at every company as a different animal. no matter how close it looks on paper to another company. In the case of Disney I saw only a theme park not a major licensing money making well run machine. Think about it, Jonas Brother, Miley Cyruss, High School Musical, all these franchises are money makers, but since i lumped Disney into the same bag as Six Flags i missed out on the big picture.

When your putting your money into a company the first thing you want to grasp is the big picture. Start with the macro then move slowly into the micro.

So this week ladies a gents as you watch the market apply the most basic rules of this investing environment.
When oil goes down, the market goes up.
When oil goes up, the market goes down.
When inflation spikes, so does gold.

as you watch these unfold start thinking aboujt potential trades and you will notice great success.

So as the Government meddles with financials and grows the deficit inflation will spike, so guess what to do. look at the simple rules above and make your trade. Gold GOld GOldGOld GOld GOld precious metals GOLD GOLD GOLD GOLD. GOLD Bars GOlD commodity contracts, gold ETFs I don't care but inflation is a killer of corperate profits especially those huge DOW weighted conglomerates that need to convert back into the dollar before putting revenue on the books. They will struggle and miss estimates then drop in price. So shy away from them. Sorry Ken Fisher but your wrong my friend.

any way take care all hugs and give a shout out to Rampage Jackson when you can.
cheers
Tony

So much drama and so many microphones!!!

Holy moly ladies and gents, we have been on a pretty good run the past few days despite the efforts of those in the spotlight. What do I mean? well, glad you asked.

I think someone needs to remind all those who hold elected and appointed positions in the government that a microphones does allot more than convert your voice to electricity so that their words may be broadcast to all of us down in the real world.

Again what do i mean? well, glad you asked.
First we have old Ben Bernake telling us banks are great and not to worry the economy is slow growing but is still growing. Then thirty minutes later you have Bush telling us that the markets are "Basically" sound. What does that mean? I asked everyone, but no one seemed to know. Well I found out what it meant, the word "basically" means... a drop to a two year low in the Dow. So I am sponsoring legislation to ban the word "basically" from the English language. So vote for it, my retirement account thanks you for your support.

OK I'm not really leading a vendetta against the word "basically" but maybe I should. just kidding.

well what to do now? Well, as always with my usually disclaimer, it is up to you. For me and my accounts we took bold action on the dip and bought the only bank i feel comfortable with Well Fargo (WFC) and sold it three days later for a profit of 25%. So now that i have made my gaol this year, I'm taking the rest of the year off. OK maybe not but it is a thought.

Let me step back a moment, I'm not one to brag about how great of an investor I am, but I mention this trade for several reason.

1) don't be afraid to be a contrarian investor. Like i always say, just because they are on TV does not mean they are smarter than you. So if the door of opportunity opens take it! BE LIKE A LION and roar your way to profits.

2)i know i said i hate banks right now, but DOW at 10,900 sets up a different playing field. All things are dynamic, so be open to change. Beside Wells Fargo is a great business that pays a descent dividend. So if i was forced to hold it for a while at least i would have gotten paid to sit on it.

3) In times of uncertainty and overall bearish sentiment, shorten your investment horizons. (I think I have said that before). In the case of my Well Fargo trade, I was willing to risk buying a company in a extremely bearish sector but only to hold for a few day.

I hope that helps explain my logic.
So what is the next trade, well we will have to see how the next few days pans out. Hopefully Oil will continue to retreat causing the markets to rise, then i most likely will get in and out of XME the mineral ETF . i might even be persuaded to sell some close to the money covered calls.
Any way keep an eye out for those retreating minerals but this is not a good time to trade oil stocks. Their are simply too many eyes on oil and that leads to too much volatility for my blood.

take care all and check out the video clip below. it almost make me sick.
http://www.youtube.com/watch?v=adYbFQFXG0U

Dow falling the 11,000. Is this the end?

First, I guess I should apologize to all those out there in cyber-land for not responding to all of your questions last week, if you have been reading my blog for a while you know that I have been telling everyone I know that it is my opinion that the market was going to have another major dip, so as a result I decided to step away from the old chess board for a moment to get some distance from the market and my portfolio. In the army we would call this a "Tactical Pause" and it is a great opportunity to take a moment and gain a new perspective and avoid "tunnel vision syndrome".

So here we are, the DOW slipping below the 11,000 and for some people out there that means all the gains they have amassed for the last two years have are gone. That is pretty crappy. That is all is can say about it.

So what about the week ahead, well ladies and gents out there I wish i could tell you. The past week was a tough week to gauge filled with contradicting indicators. The Volatility Index (which i use to gauge the number of bears out there) although high was not to a level to cause a new low. The Advance/Decline numbers seemed flat to me. And at the beginning of the week we had another round of headlines talking about more credit issues and write downs that the market almost completely ignored but put the news back into the price on the close of the week.

So what now, well i could tell you in my gut that the market is going to have a strong Monday as Institutional investor jump in and lower their cost basis and open new positions then later in the week test new lows as people profit take from the bounce, but that is simply my gut feeling I have no, in my opinion, real data to support this. The matrix I have developed tells me a flat week ahead, but it does not take into account the emotions of investors.

So again what do you do? although your plan of action is really based on your personality and what has worked for you in the past, unless you have you survived the tech bubble of 1998 and have decades of investing experience, in which case i doubt you would not read my blog, you are in uncharted waters which when it comes to money is a bad place to be. Uncertainty in the market leads to volatility, which leads to more volatility. So in my portfolio uncertainty leads to CASH, CASH, and more CASH. You can make allot of money on weeks the market performs like a roller coaster, but only if you have cash to make your moves.

So never be all in and never be all out of the market. Find the mix of long and cash positions that work for you. The more uncertain you are the more cash should make up you portfolio and the shorter your investing horizons should be. In times like these, it is my opinion that you worry about not losing your nest egg rather than missing some golden opportunity. Trust me you'll sleep better at night. Remember there are a over 4000 opportunities a second in the market, you just have to find them. So get get CNBC or MSNBC tunnel vision. Take care all of you,
T

If I can make it here, I can make it anywhere, it's up to you...

Look at the Yahoo Finance main page, and you'll see the headline. it reads "Stocks Rise as Employment Report Comes In As Expected". Stocks rise? The Dow is sitting at 11,200. The market was hovering at 11,800 last week. Stocks rise? Not to mention that the market was flirting with 14,000 no more than a year ago. Looking at my long portfolio it sure does not seem that stocks are rising, in fact I'm not sure but basic arithmetic tells me that stocks are falling.

Let's face it, if you were in the market when the Dow hit 14,000 seeing the market at 11,200 does not feel very much like the market is up. You, like most, are feeling the pain of this little correction, but a great lesson can be learned from this hole fiasco.

What is the lesson, you ask?
Well, first and foremost we have the market. Look at the market itself and its current level. Although i don't watch any financial television, the last time i did Qualcom was getting ready to break a $1000 a share and the media applauded the ride, then the tech bubble burst and i found half of my net worth gone. So as a result i watched more financial television thinking there i had missed some great piece of information. So I became a fanatic i got another television so i could watch both Bloomberg and CNBC but still my stocks went down. Meanwhile these supposed financial journalist stood scratching their heads still telling me that the market was going to recover, and it did. Four years later.

The lesson..just because a guy on talks stocks on T.V. does not mean that he is smarter than you. So, take what they say with a grain of salt. More often they are just repeating what someone else told them or what some corporate sponsor told them to say. Don't underestimate your abilities to pick your own winners.

Lesson 2, don't try to time the markets. It is impossible. yeah you can gather enough information to get a pretty good idea of where the market is going in the near term (just look at my posts below, I'm pretty good at it) the only information this gives you is how much cash to hold in your reserve because we always by on dips to lower our cost basis. But remember we never go to a point where we have no cash in reserve. Don't get greedy.

Lesson 3, Find the strength. Find momentum. Find were the smart money is going. Use MACD's, bolinger bands, 13-d's, use barrons, investors business daily, use your uncle's know it all attitude toward everything to hunt out your next move. But remember take what every one says with a grain of salt. Gather and interpret then move. But before you move decide how long you will hold this investment, and how much you plan to make. Then stick to your plan. If it is not working out, sell. sell. sell. In this market it is wiser to sell than to hold because we all know the market is going to go down further.

well that is all for now, go get drunk this weekend and eat your face off, and chill with the family.
cheers to all.
t