Investing 102

[Sieg]

Originally Posted by bdahlg68

Lots of things to consider, think about, and occasionally.... worry about!

Appears the market hasn't responded too well to Bernanke's semi-annual monetary policy testimony to the House this morning. One big event or a couple small ones in succession could trigger a slide. We're definitely treading on thin ice IMO. Be ready to counter-steer and keep your 6 covered people.

[Bucketlist2012]

This is getting good..

I live life at the moment, but I buy investments that I am looking at 10 years from now...Where will it be ??

This is Investing and not trading.

And yes, when you do have enough money, you get even better treatment at Schwab.

I never Lie...I get advise...I make the final call and they tell me it is MY call , to Cover their rears..We have meetings..But there is no finger on the button, haha...

I have the best Muscle car shop work on my car IMHO, Ihave the best attorney around IMHO, why would i not get some advise with the thing that funds EVERYTHING.. I do.

I am not in and out and I have the merit badges from 2008, and 2011 to prove it...I made Eagle Scout..I held, and i bought...Last year I roped myself to the tree and rode the crazy days...

Point is research, action, long term visions, guidance in these crazy times..No listening to the noise..they run around like a mosh pit at a heavy metal concert..madness..stupidity..

Up and down goes the balance, but in the end, it is up, and I have SPENT another years worth of money, and my NET worth is higher, or it has stayed even at worst...

I don't have Greg weld skills, but give me more time...

[Sieg]

All poking aside - Greg..........you're awesome.

Barney Frank on the other hand...........

[Bucketlist2012]

Originally Posted by Sieg

All poking aside - Greg..........you're awesome.

Barney Frank on the other hand...........

I agree..


An edit to my post would be although i am looking long term of where the investment will be long term, i do look at the medium term trends set by policies, feds, ect... But i am not with my finger on the trigger..It is more thought out than that... Things changing overnight are not the concern, as much as the longer term..

Greg, you are the Man... The thread Gorilla Glue...

[GregWeld]

Okay --- so I had this crazy thought for the newbs this morning. We were discussing interest rates and the FED etc...


This is investing 102 (wasn't 102 a cheap beer years ago??) so let me paint an "interest rate rising" scenario for you.


Here's how you pay attention and react in a MACRO (large picture) environment:


You're in a movie theatre - packed full of people.... you're looking around and checking everyone out and making your judgements about them (don't BS me - we all do this).... and in the corner you notice a 4 year old... no parents around.... no big sister. You also notice that nearby (him) on the stage there's a book of matches... If you're me -- I now keep an eye on this little monkey... I'm not afraid of him... I just know what a 4 year old could/can do with a book of matches.

Now.... I'm still looking around and waiting for the movie to start - a movie I've waited for 6 months to see.... This is when I notice the little monkey making his move to the matches...

Do you wait for him to strike the match before you get up and depart? Heck no! I know exactly what is going to happen when he lights them up! Panic! F-I-R-E!!! and everyone is running for the exits.

Nope -- If I even THINK the little monkey sees those matches -- I'm outta there! I'll stand by the door - and wait to see if a parent is also watching and kicks his sorry little butt... then I'll re-take my seat.


SO......... If the matches are INTEREST RATES.... and the little MONKEY is the FED/CONGRESS.... I'm keeping my eye on them! I'm not going to be out of the market because the minute you make that move -- the market will shoot up 10 points and you'll have missed the move. My point is to KEEP YOUR EYES OPEN... don't bury your head in the sand and hope everything works out for you! Be proactive. Proactive doesn't mean ACTION -- it means staying alert and understanding the relationships (the boy near the matches - doesn't mean he's going to do anything with them - but you KNOW what happens IF he gets his hands on them).

SO if YOU can look around your little piece of the world -- and things are looking up -- the company you work at just hired 10 more guys -- and you're working overtime... and prices of cars at Barrett Jackson just exploded to the upside... and there's less talk about all the houses in your neighborhood for sale... and you're lazy ass sister in law just got a job... DUDE! It's time to start rethinking your high yielding stocks -- 'cause if YOU can see this -- then so does the FED and they'll raise interest rates.

Now there's TWO ways to think this game through! If things are getting that much better! Then sales should also be better... housing picking up - so too will appliances and car sales - which means raw steel and aluminum will start to rise (and copper)... and Caterpillar will sell more backhoes and dozers... So what you do when all this is booming through your little pea brain -- is you start to move those directions. Lighten up (scaling out) of the crazy high yields... and start to move into (scaling into) the areas of the market that will BENEFIT from a booming (or far better) economy. Home builders - banks (lending!) - machine makers (CAT and Cummings) etc. This is why they call them WHAT?? CYCLICALS -- because that's where they are - they cycle up and down good times and bad. Out of them (early) in bad times - (in early) in good times.

Ya don't sell everything and panic and run for the exits.... ya just stay fluid... keeping your ears open... try to hear the winds rustle... before everyone else.

To me it's like house flipping. By the time the grocery store clerk is telling you about the 400K they made flipping a house -- it's just about to come crashing down!

So listen to your instincts... DO YOU see that things are getting better? Interest rates are NOT going DOWN from here... there's no room left at the bottom -- so they're either holding steady or they're going to HAVE TO go up from here... it's just for you to be ahead of that curve. Nobody has a crystal ball. I'm going to make money as long as I possibly can in my current holdings - but I'm also paying attention to the details.

[toy71camaro]

very good point.... i was "wondering" what to think about that situation. That helps.