DollarCreater.com » commentary http://dollarcreater.com Finding You Many New Ways to Create Dollars on Your Own Sat, 04 Feb 2012 21:30:06 +0000 en hourly 1 http://wordpress.org/?v=3.3 Forex Breaking News – Jim Rogers says UK is FINISHED http://dollarcreater.com/forex-breaking-news-jim-rogers-says-uk-is-finished http://dollarcreater.com/forex-breaking-news-jim-rogers-says-uk-is-finished#comments Tue, 20 Jan 2009 08:17:41 +0000 IdeaMan21 http://dollarcreater.com/?p=335

Jim Rogers, World Famous Investor and former partner of George Soros, who single-handedly kept Great Britain from joining the European Union and at the same time became billionaires, has said that the “U.K. is Finished“. He made this statement as the Pound hit a record low versus the yen and the weakest level since 2002 against the US Dollar. When a whale makes a statement like that, it’s truly Forex Breaking News.

His reasoning is that the government will have to rescue a great number more banks that previously thought and the economy keeps slipping farther than it has since the end of World War II. He says to sell the currency immediately. “I would urge you to sell any sterling you might have,” said Rogers. “It’s finished. I hate to say it, but I would not put any money in the U.K.” Jim Rogers correctly predicted the start of the commodities rally in 1999. He also made a killing on the Crash of 1987.

Commonwealth Bank of Australia said there was a high risk of a cut to the country’s credit rating outlook and lowered its pound forecast. Prime Minister Gordon Brown authorized a 100 billion pound ($142 billion) bailout for banks.

The pound slid to 127.44 yen, the weakest since at least 1971, as of 2:23 p.m. in Tokyo from 130.71 yen yesterday in London, according to data compiled by Bloomberg. It declined 2 percent to $1.4133, the lowest since March 2002, and last traded at $1.4185. The currency slid 1.1 percent to 91.58 pence per euro.

Jim Rogers said the currency will fall below its record low of $1.0520 reached in February 1985. He believes that the U.K. debt is now greater than previously forecast due to the additional bailouts announced over the weekend and today.

Jim Rogers also said investors should be “worried” about the U.S. dollar, and recommended selling government bonds and buying raw materials, China stocks and the yen.

“If I were you, I would be worried about the U.S. dollar,” said Rogers, 66, in a speech at the Asia Financial Forum in Hong Kong today. “The Americans are printing U.S. dollars. The Americans are going to do whatever they can to revive their economy, even if it means destroying the U.S. dollar.”

Now is the time to make a killing shorting the UK Pound. With everyday news coming in on just how really bad the banks are in the United States and in Europe, it seems that the US Dollar and the U.K. Pound are going to be taking the brunt of the blow.


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]]> http://dollarcreater.com/forex-breaking-news-jim-rogers-says-uk-is-finished/feed 2 US Dollar Hits 13 Year Low http://dollarcreater.com/us-dollar-hits-13-year-low http://dollarcreater.com/us-dollar-hits-13-year-low#comments Mon, 15 Dec 2008 18:39:01 +0000 IdeaMan21 http://dollarcreater.com/?p=328

The US Dollar hit its 13 year low versus the Yen Friday and rebounded shortly after that. However, if you look at the currency markets overall a trend is starting to show, that the US Dollar is weakening. This is a point that is being argued about alot but a select few economists and professors of economics seem to agree that the US Dollar is going to tank.

The reason for this isn’t really that complicated. We are the largest debtor nation in the world. In 28 shorts years we’ve gone from being the largest exporter and lender to the world to the opposite. Reagonomics and the Laffer Curve be damned. The two combined have wiped out almost our entire manufacturing base and we have to borrow money every single day just to function as a government. With the Investment Bank collapse in September and October and now the stock market collapse the rest of the world is figuring out that we won’t be able to pay back our loans. This alone will kill the value of the US Dollar.

Check out this video from Novermer on Fast Money on CNBC. Peter Schiff has hit this on the head going back over 2 years and unfortunately he has been right. But what he is predicting now is dire.

Our Government and the Fed specifically has been playing witchcraft games with our economy for so long that it looks like no matter what, the market is going to correct itself and we all are going to feel the pain of this correction. Buy and Hold Investing is dead because the market is so volatile and there is no rhyme or reason for these 20 percent moves on some stocks that you must find something to hold onto in the interim.

Gold is that something. Again, going back to Peter Schiff he makes a great case for buying the precious metals and Gold in particular. It is really best to buy actual Gold buy investing in Gold futures will be better than nothing. When the US Dollar collapses Gold will be standing extremely tall. Think about it, if you use the US Dollar to buy Gold and than the US Dollar is worth less, Gold goes up by default.

Check out this video of Peter Schiff talking about Gold.

He has already predicted that Gold would hit $1000/ounce this year and it did. He is now predicting it hitting $2000/ounce next year and I wouldn’t bet against him anymore. He seems to have hit this right on the head and he started talking about it back in 2006.

After watching that it is scary how accurate Peter Schiff has been, even in the face of laughing pundits and “so called experts” on these practically worthless Financial Talk Shows. It seems like the talk shows are more about entertainment than about facts. Do they look at us like children that can’t take the truth or are they themselves unable to face the hard facts of life.

Either way I think it is time that you looked into the falling US Dollar or buying Gold, both if you can afford it. As far as Forex Trading is concerned there are hundreds of ways to invest in this market and it is easier and faster than investing in Gold. But I would be looking to start doing it soon since the writing appears to be on the wall for a US Dollar fall.

]]> http://dollarcreater.com/us-dollar-hits-13-year-low/feed 0 Buy and Hold Investing is DEAD! http://dollarcreater.com/buy-and-hold-investing-is-dead http://dollarcreater.com/buy-and-hold-investing-is-dead#comments Fri, 21 Nov 2008 10:40:43 +0000 IdeaMan21 http://dollarcreater.com/?p=308

Buy & Hold Investing Is Dead!

There, I said it.  It hurts to say it but look at the evidence over the past 2 months.  If you invested in the Stock Market in 1997 your stock is worth the same as it was then.  Is that what you call investing.  You could have left it under the mattress and ended up with the same thing, except you wouldn’t have fooled yourself into thinking that it was worth more 2 years ago and you wouldn’t be hurting today realizing that it is worth the same, or less if you count inflation over the 10 year period.  Hopefully we won’t see deflation.

Stock Market Investing really looks like it may be heading back to the 1930′s.  Not old enough to remember the 1930′s, me neither.  But I can read and watch history videos on the internet and on the history channel.  Also PBS’ Nova ran a great program last week called “The Great Depression”.  I thought that I had read enough about the subject but I learned a couple of things.  One, that the stock market was completely rigged by a handful of big shots.  Two, that once J.P. Morgan the man stopped a sell-off all buy himself by walking across the street into the board of trade and yelling that he was buying.  That was all that it took for the mass hysteria to subside.  Three, 5 months later no one man could stop the collapse, because several tried, including J.P. himself again.

Another thing that I never realized was that it took 25 years, yes I said TWENTY FIVE YEARS for the market to return to the highs of 1930′s.  That means it was way after World War 2 and Elvis Presley.  Our economic system was brought to its knees and it took a victory over Germany and the subsequent raiding of Germany’s scientists and (innovations) patents to turn the United States of America into the financial leader of the world.  Who knows how long it would have taken to get the market back without that war and infusion of talent and expertise.

I have felt an uneasiness about our economic situation for years.  I couldn’t understand how people were buying all of these big houses and complete neighborhoods were popping up everywhere I turned.  It didn’t make sense to me and I guess we all now know the reason why.  It didn’t make sense to loan people money on a house they couldn’t afford by banks and investment houses that didn’t have the capital to cover the mortgage if the homeowner defaulted. And then to make it even worse the Insurance Companies were brought in to insure the risk without a clue to what they were insuring or where or who.  Crazy.  It took 10 years or so but the roosters came home at last, and our financial empire is going down with it.

If you study the market or watch the programs on TV, my favorite is Closing Bell on Bloomberg and Fast Money on CNBC.  Fast Money is excellent and lively and full of ideas daily.  It is on at 5:00 pm Eastern time.  Anyway, you now can see that the market is not following any fundamentals anymore.  Strong balance sheets or cash on hand or a great CEO or Warren Buffett buying your stock and telling everyone that can listen to buy and hold, nothing has stopped the collapse.  What I didn’t mention about that Nova “The Great Depression” is that quite a few of those big shots lost everything they owned.  J.P. Morgan didn’t, but almost.  I’m afraid that Warren Buffett might be falling into this category himself now.  I know he is the most successful trader in our generation, but all of his success came in a different climate than what we have now.

Mr. Buffett bought shares of Goldman Sachs 2 months ago and has lost 50% of his value.  This has never happened to Mr. Buffett and I bet he is starting to feel like the rest of us on a trade we’ve made that is moving in the wrong direction.  Except he spent $5 Billion dollars!!! This isn’t the only thing that he is losing money on and if you have been paying attention you may have noticed that today 13 of the 30 Dow Jones Industrials hit their 52 week low.  If you are into technical trading you know that that is a really bad sign.  The bottoms were blown through today also which means now we must be searching for a new bottom for the markets, all three of them, the DOW, the NASDAQ, and the S & P 500.  We are in a free fall with no idea where we will land.

So when I say Buy and Hold Investing is dead, I’m just looking at the situation through clear glasses, not the rosey ones that I usually use.  When fundamentals doesn’t matter and confidence induced allegories doesn’t matter and the Federal Reserve backing your assets doesn’t matter, BUY AND HOLD IS DEAD.  But there is a way to take advantage of this market still.  Its in the DOLLAR.

But before I get ahead of myself I think that I should introduce you to probably one of the few people who had this figured out years ago, in fact, he has written 2 books on the subject and if you google his name and go to youtube you will find massive video evidence even as early as two years ago and as late as April and May of this year of him predicting the housing collapse and then the investment bank collapse and next in line is our entire financial system.  Unfortunately, he has been right so far about many things.  His name is Peter Schiff.  He was on Fast Money today and he blew the doors off of the myths going around about this being a recession that lasts 6 to 9 months.  He called the recession a year ago and he also said gold would hit $1000 an ounce, which it did this summer.  He is now predicting Gold to hit $2000 an ounce by next year some time and possibly going much higher when the Dollar collapses.

Hopefully he is wrong, because if he is right our way of living is going to change on a drastic level.  Depending on your age, we may be about to have to go through what our Grandparents or Great-Grandparents went through in the 1930′s.  We have let our country go from being the largest producer of goods to being the largest consumer of goods.  The only thing we make are cars, tractors, weapons and corn and wheat.  We buy 1000 times more than we sell and we now as a country are in debt to the tune of $10 TRILLION DOLLARS.  Between Reagonomics and the past 8 years of Bushonomics with a little of Clintonomics thrown in we have destroyed our manufacturing base and now depend on the rest of the world to make things.

Peter makes the point that the person who makes things can sell them, the person who just manages money and fools people into thinking it is worth more than it is when it is not backed by anything (like Gold) is in a whole lot of trouble when the bubbles burst.  As I write this today the toy company Mattel, who makes Hot Wheels, is worth more money than General Motors, who make actual cars.  How can this be possible?  Only in an imaginary universe of inflated dollars and witchcraft like confidence in a system that has been preached repeatedly for 30 years.  The only thing holding us up is that the world still has some confidence in the Dollar.  But Peter thinks that that is about to end, and that will devastate our system.

So start investing in other countries currencies.  He has been right so many times and on so many subjects that I say what the hell do you have to lose?  I have found an automatic Forex Trading Program that is returning excellent results and you should take a look at it also.  Peter says the dollar is going to collapse so if you start investing in currencies now you can than be rich in Euro’s or Swiss Francs, which will make you extremely rich (compared to your neighbors) in Dollars.

Go check this out and get started in sustaining your lifestyle before its too late:

]]> http://dollarcreater.com/buy-and-hold-investing-is-dead/feed 1 Discover the Advantages of a Foreign Currency Forex Mini Account http://dollarcreater.com/discover-the-advantages-of-a-foreign-currency-forex-mini-account http://dollarcreater.com/discover-the-advantages-of-a-foreign-currency-forex-mini-account#comments Tue, 21 Oct 2008 06:59:46 +0000 IdeaMan21 http://dollarcreater.com/?p=301

I have been asked several times, especially recently, what are the advantages of foreign currency forex trading and I tell whomever is asking is that this is a truly historical time in the history of man, and huge sums of money can be made with very little money down.  As you have witnessed the stock market the past 3 weeks has been going up and down in historical proportions and the US Dollar was very low but has bounced back as the world recoiled from our little 40 to 1 mortgage/insurance/craps game investment houses imploded upon.  But not everyone has money to play so I always tell them about the foreign currency forex mini accounts, the everyman’s ability to get into this little game. But what are the advantages?
Well, there are a lot of advantages of a forex mini account. The best thing is that with a foreign currency forex mini account you get to enjoy benefits that are enjoyed by the holders of regular forex accounts. Some of these benefits are small spreads, free trading platforms etc.

USING $50 TO TRADE 10,000
There is a term that is very commonly used in the world of forex mini account. It is leverage. It could be understood as a facility that allows you to trade more than your deposits. For a mini forex account, the margin deposit needed for every $10,000 lot traded is $50. Now, you do the math. A simple calculation of dividing the two quantities would tell you that the leverage here would be 200 to 1.

If you deposit just $250 in your mini forex account; it means that you can trade a maximum of five lots. Increasing the deposit to $1000 would allow you to trade a maximum of 20 and so on. Compare this with a regular forex account. The leverage there is just 4 to 1 for account holders having $25,000 or more in their account. This means that the leverage of someone having mini forex account is fifty times higher than a regular forex account. It is true that higher leverage could not always be used but what it does is that you get some distinct advantages in terms of flexibility in changing the strategies as per the changes in forex market.

Also, you are in the game, you have an opportunity to actually make money.  You gain experience and you gain insight to your own psyche as to how much you feel comfortable with risk and how much you are able to go for the gold without losing sleep.  This is extremely important in any type of investment but you learn your own boundaries quicker and cheaper this way.

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]]> http://dollarcreater.com/discover-the-advantages-of-a-foreign-currency-forex-mini-account/feed 1 After the Bailout is my 401k Safe? http://dollarcreater.com/after-the-bailout-is-my-401k-safe http://dollarcreater.com/after-the-bailout-is-my-401k-safe#comments Sat, 04 Oct 2008 08:11:11 +0000 IdeaMan21 http://dollarcreater.com/?p=295

Is my 401k safe? I’ve heard this question a thousand times that past few days and I actually didn’t know the answer and had to check around and make a few phone calls.  I tell you this has been a truly historic time in our countries financial markets and I and no one else knows where we are headed.  So this question I take in two different ways.

ONE: What will happen to my 401k account if I had it in Lehman Brother;s or AIG or Merrill Lynch retirement plan?  Is my 401k insured with a fidelity bond to protect it from the Investment firms going bankrupt?  Can I move my assets now after the fact? Is my 401k safe?

TWO: Should I still be investing my 401k account in mutual funds or stocks?

I’ll answer the second question first.  NEITHER!

As you may have noticed your 401k or any managed retirement portfolio has significantly decreased in value over the course of the year but especially over the past few weeks.  The talking heads on television always tell you that this is only a correction or blame it on something or another.  They always act like they know exactly why the whole market went down, like APPLE is being investigated and that caused the whole tech sector to decrease in value.  Do you actually believe that?  I hope not.

Anyway, what I was saying was that we are told that this is only a correction, and really most of the time that is true.  But it isn’t true now.  Why do you say?  Well let me tell you a little secret that I read about and have used to my advantage.  But first lets talk about moving your assets out of stocks and into cash.  I know that sounds funny, but cash is a position.  No broker or fund manager will agree with that as he can’t make money unless your account is invested in stocks or mutual funds.  But cash is king in today’s world.  We don’t know what the bottom will be in this market and you don’t want to guess that the turnaround is just around the corner.  You have lost 20%, 30% or 40% of your investment possibly, do you want to take a chance on losing even more.

As you probably know or should know if you have studied the stock market at all the stock market has had a major correction over any 10 year period.  Some of those “corrections” have wiped investors out. Most I admit haven’t and the market has come back stronger than before, but look at our situation right now.  The current administration over the past 8 years and our current economic problems are similar to a far away time that most people thought couldn’t ever happen again.  Have you ever read about the 1929 “correction” that took 25 years to come back. Do you have that long?

How do you know when to sell? Most brokers and financial planners won’t tell you for obvious reasons and most of them don’t know.  But it is up to you to protect your money so I’m going to let you in on my secret I mentioned earlier.

Their is an excellent indicator that is published every day in the newspaper Investors Business Daily. You don’t have to buy the paper.  You can look at it in the local library.  In the second section you will find a chart called the Investors Business Daily Mutual Fund Index. The chart shows an index of 24 major mutual funds. There is a dotted line called the 200-day mutual fund average. For the last 5 years this line has been rising.   It started it’s rise in April of 2003 to give a BUY signal. It has recently turned down. That is the SELL signal for the entire stock market.  To get this information online you have to subscribe to Investor’s Business Daily, so just go to your local library.

Smart investors that want to protect their investments should instruct their fund managers to sell everything and put it in a money market account.  It won’t be making a lot of interest, but at least your money will not disappear at the rate of 20, 30, 40% or more as it did in 2000.  You should than wait for that moving average line to turn back up before buying back in.

All 401Ks are in danger of losing more money now.  Protect yourself and be a prudent investor and protect your money.  Sell now.

Now on to the First question.  I was going to write a long article on this topic alone but I found out that this is an extremely complicated topic.  I have found one already written that does an excellent job of answering all of your questions, but it does cost money.  I’m not making a dime on this but it is really a good investment for the amount of information that it has.  Get a few of your co-workers to go in on it and it won’t cost hardly anything. You will be amazed at how little your 401k is protected.

Click Here to Answer the First Question

]]> http://dollarcreater.com/after-the-bailout-is-my-401k-safe/feed 1 Start a Home Business for FREE with Thirty Day Challenge http://dollarcreater.com/start-a-home-business-for-free-with-thirty-day-challenge http://dollarcreater.com/start-a-home-business-for-free-with-thirty-day-challenge#comments Wed, 17 Sep 2008 05:19:37 +0000 IdeaMan21 http://dollarcreater.com/?p=277

Today joining a home business income opportunity is very easy to do. As a matter of fact there are many different ways to make money at home and get started for free. This leads to what I feel is the most expensive mistake a person makes when starting a new home business opportunity.

Here is what I mean by that!

People search the Internet looking for free opportunities to make money at home. In many cases they do this because they just do not have any money to invest. In other instances they are worried that they are going to be taken advantage of. This is understandable because there certainly are a large number of scams on the Internet today.

For people who do not have any money to invest trying to start a home business online is probably a mistake, or at least it used to be. Now you can be trained for free and set up web pages for free and draw traffic for free. I didn’t even realize this until a couple of weeks ago when I happened to stumble upon it looking for something else.

To make money on the Internet today you need traffic coming to a moneymaking website, and the Thirty Day Challenge can teach you exactly that, and its FREE. The tools you will use are also FREE. They even teach you how to find a niche and how to test a niche product to prove that it is profitable before you ever invest one single penny. Can you believe that it is FREE?

Even the best products and websites online will not make money without visitors coming to those every day. That’s why it is so important to test first, especially for FREE, which is what the Thirty Day Challenge does for you. They offer free tools to help you test and offer unbelievable amount of video on exactly what to do to attract traffic. Did I mention that it is FREE?

Click Here and Sign Up for The Thirty Day Challenge

The best kind of traffic is the free traffic you will get from the search engines. The 30 Day Challenge teaches you how to attract the search engines and how to exploit search engines, for FREE. This is also referred to as organic traffic and it requires skills to create, but luckily you will be taught these skills for FREE!

So If You Want to Learn How To Make A Money Making Website For Free:

CLICK HERE: Thirty Day Challenge







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]]> http://dollarcreater.com/start-a-home-business-for-free-with-thirty-day-challenge/feed 0 Online Home Business – Income Building Ideas From Forums http://dollarcreater.com/online-home-business-income-building-ideas-from-forums http://dollarcreater.com/online-home-business-income-building-ideas-from-forums#comments Wed, 10 Sep 2008 07:27:36 +0000 IdeaMan21 http://dollarcreater.com/?p=269

Having just spent time in my favorite forum catching up on today`s posts, I realized that forums are not just great places to pick up internet business ideas and meet new people, but how essential they are for internet home business building.

While not all forum members are internet home business owners, most are trying to generate an online home income from a wide variety of different sources. Forums provide an essential platform for like minded people to network and draw on the vast amount of constantly changing internet business building ideas, knowledge and information available on the internet.

We need to keep up to date with what is happening online in order to be aware of important changes that could have an effect our online home business as well as our home business income. Forums are just the place to get that information. By keeping abreast of what is going on in the online world about for example algorithm changes or amendments and changes to programs you are involved with will help you prepare in advance in order to avoid shock and disappointment.

We have the great opportunity to keep up-to-date by joining a variety of good active forums that are related to internet marketing, online home business, seo and internet business building ideas and have an experienced, solid and knowledgeable membership.

By keeping in touch with one another and keeping up with the current online news, which we will find in these forums, then we will all be aware of any changes that are either happening or are in the pipeline that could affect our internet home business or home business income.

It is in the forums that we hear about the latest releases of software, the latest products, strategies or packages and also the very important feedback from the experienced members. This way the newer members will stand a good chance of avoiding any new scams as well as be aware of any really good products or service that are recommended by trusted and well known members.

While drawing on all the valuable knowledge and constructively contributing in the forums, the best bit is being able to quietly promote your own site or internet home business in the space at the bottom of every post – your own signature. So be sure to complete your profile when you join a forum and set up your signature with your keywords linked to your url. Check the rules relating to signatures as they do differ from forum to forum.

When setting up your profile you will have the option to display the country you are from. This enables members from the same country to easily locate each other to discuss and exchange online business ideas as well as solve problems relative to that country, for example which payment processors can or cannot be used in that country or more importantly how do members in that country receive the income earned from their online home business.

Forums provide a win-win situation for all active members so it is advisable to get involved in a variety of forums related to your online activities, contribute and draw from the gold mine of internet home business building ideas whilst at the same time promoting your online home business.

About the Author:

Cynthia Minnaar is the owner and webmaster of www.cyns-home-biz.com, the online home business site for internet home business opportunities, ideas to start an online home business, internet income training and more. Get your own Plug-In Profit Site setup free and start making money online. You may publish my article provided you include the resource box.

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]]> http://dollarcreater.com/online-home-business-income-building-ideas-from-forums/feed 1 10 Mistakes Every Investor Makes & How To Avoid Them Part 1 http://dollarcreater.com/10-mistakes-every-investor-makes-how-to-avoid-them-part-1 http://dollarcreater.com/10-mistakes-every-investor-makes-how-to-avoid-them-part-1#comments Wed, 27 Aug 2008 07:18:58 +0000 IdeaMan21 http://dollarcreater.com/?p=158

Throughout my years of investing I have had the opportunity to be a part of many different experiences – some good and some bad. What I have learned by being trained and working with investors in all different markets is that the discipline to follow the fundamental rules to investing can make or break someone’s bank account.

While even amateur investors know these basic rules to investing, it is much easier said than done. Maybe this is because most investors have a competitive edge, and we think we can out-perform or outsmart the next guy. But the bottom line is it is pretty tough to outsmart the market.

Investing is a zero sum game. For every winner there is a loser, which is what keeps the market efficient. Knowing this, it is possible to develop an edge in order to win more than you lose. This is why some of the best trading systems make people so much money. These systems have found a way to analyze trading opportunities and automate the process so you can get in and out of trades quickly and profitably.

However, many investors and professional traders still manage to end up in the red. These investors are unsuccessful because they let emotions get in the way, are too stubborn to be successful, or they think they know something other people don’t. They can literally have their trading system screaming at them to get in or out of a trade, and yet they ignore all the signs.

What these losers fail to realize is that the market is irrational because it is driven by emotion and institutional houses throwing their weight around. For that reason, it is nearly impossible to predict short-term directions and win every time. If you avoid the common mistakes that every investor makes, you can develop an edge and build an unlimited amount of wealth.

Nothing in this article should come as a surprise. These are basic investing mistakes that every investor should avoid. But for those who like to make money, sticking to the basics may not be an easy task. It involves leaving your ego behind, some planning and sticking to the rules or trading system you have in place.

Mistake #1 – Playing Without Rules

No matter what you invest in you must create and stick to personal investing rules. It doesn’t matter if you invest in real estate, currency, stocks or options, before you begin you must create strict strategic rules that you will hold yourself accountable to.

The rules should provide a checklist for the investor when considering opportunities. By creating strict criteria, it places limitations on the investor and takes the emotion out of the decision. There could be multiple opportunities that the investor finds that he knows will create great returns if Action A happened followed by Action B, but gambling simply does not fit into his rules for investing. Therefore, he would pass on such an opportunity.

Secondly, these rules provide a clear exit strategy with deadlines. The investor knows going in that he can potentially make a certain amount of money, say $20,000, but more importantly he also knows the potential that he can lose by not selling the opportunity in a certain amount of time. By having a backup plan, and a backup plan for that plan, the investor minimizes the downside and eliminates the need to make an important decision that is influenced by emotion or hope.

Mistake #2 – Ignoring Taxes and Fees

Investors often get excited about the potential income an investment can make and forget to consider fees and tax implications that can diminish their profits. When trading stocks, for example, a single stock purchase can cost you $10 or more, even with a low-cost, online brokerage account. If you are buying 10 shares of a $10 stock, that value of the stock will have to increase 10% before you can break even.

Add capital gains tax you now owe on the appreciation of this asset, and you have actually lost money on your prudent stock purchase. How much you are paying in taxes depends on the type of investment and how long you hold the asset. MoneyChimp.com has a free Capital Gains Tax calculator. Click Here to See It.

Mistake #3 – Confusing Investing with Trading

People who are not investors often think investors are the high strung, fast-paced people in the New York Stock Exchange pits, or those that stare at stock charts all day long to catch a quick profit. These people are not investors. They are day traders who play markets for a living.

Investors are much different. They are interested in the certainty the stock market returns as a means to produce wealth, as opposed to the possible income it can produce. For that reason they are less concerned with the day-to-day activity in the market and are not depending on how the day goes in order to produce immediate income.

They know that over time the stock market has historically trended up and they take advantage of the slow and steady profits the market will return. With those profits, they reinvest their earnings in order to take advantage of compound interest and accelerate their net worth.

Mistake #4 – Letting the Media Influence Decisions

The stock market is partially driven by emotion. Many investors would say in the short-term the market is entirely driven by investor psychology. People hear a stock tip about an upcoming earnings report, and they race to get in before everyone else does. An earnings report disappoints Wall Street and the stock drops 10% in after-hours trading, which keeps investors up all night in a panic and they immediately sell first thing in the morning.

While psychology ends up being the primary driver for decisions for individual investors, the assets you buy should not be an emotional decision. This is why it is imperative for investors to create a strategy with specific rules that they can stick to. However, the media loves to drive this emotion. There are television stations dedicated to the up-to-the-minute movements in the market, rumors and other current events. This coverage keeps viewers glued to the television, which drives advertising revenue.

The media may provide relevant information to the short-term day trader who is trying to capitalize on investor psychology, but for the most part very little should cause a long term investor to act today. Therefore, to avoid letting the news influence your investing decision, ignore media influence as much as possible, remind yourself why you purchased the equity in the first place and ask if those same reasons still exist.

Mistake #5 – Taking Too Much Risk

Losing money is the only thing keeping investors from creating wealth. Sounds obvious, but many investors don’t pay attention to this mistake. As Warren Buffet so eloquently put, “The first rule of investing is don’t lose money. The second rule is don’t forget rule number one.” When you lose money, it takes twice as much money just to get back to break even. For example, if an equity loses 50% in value it will require a 100% increase just to get back to break even.

When you take substantial risks, it’s not unusual for your asset to decrease 50% in value, but gaining 100% is far more unusual. While the dividends and earnings from your winning stocks can be reinvested in order to take advantage of compound interest, your losers also compound and quickly eat away any gains you achieve in other investments.

This is the end of Part 1. I will post Part 2 and the Other 5 Mistakes tomorrow.

Feed Shark




Turbo Tagger

]]> http://dollarcreater.com/10-mistakes-every-investor-makes-how-to-avoid-them-part-1/feed 0 Fast and The Furious – Trading Penny Stocks Can Be Dangerous http://dollarcreater.com/fast-and-the-furious-trading-penny-stocks-can-be-dangerous http://dollarcreater.com/fast-and-the-furious-trading-penny-stocks-can-be-dangerous#comments Tue, 26 Aug 2008 05:22:52 +0000 IdeaMan21 http://dollarcreater.com/?p=153

Trading Penny Stocks is like the movie Fast and the Furious, you really have to have reflexes of a cat to protect yourself and your investment.  Isn’t stock trading is an amazing concept? It makes billionaires out of ordinary people like you and me. We bet on companies and when these companies do well (or beat expectations), we make money, it’s that simple. We all know that the secret of success at the stock market is to really know the market that you are dealing with. Not everyone is smart enough to read the fine print on financial manuals and apply economic theory to predict the future though. That’s where firms like DoublingStocks.com come in.  Choosing a program smartly can be the quick road to success with a little bit of hardwork and a lot of determination.

DoublingStocks.com originated in 1999 when Michael, a Programmer, teamed up with a fund manager Carl Williamson, to create a penny stock trading program called “Marl”.  They used a combination of western technical analysis and ancient Japanese candlestick charting techniques for any penny stock by meticulously plotting and charting dozens of market indicators. According to Tom, a writer at DoublingStocks.com, in the year 1999 alone, the Marl program had thirty eight winners in back to back trades, which averaged a profit of 218% per trade. That’s where one of the most successful penny trading programs – DoublingStocks.com, was born.

The website appears interesting from the very first glance and enticed the visitor to find out more about this amazing concept of making millions from pennies. The program now distributes a subscription based newsletter where they share their top stock picks. This company’s success is founded in their ability to analyze penny stocks in a manner that’s very different than the traditional stock analysis models. Have they been successful consistently though?  The results speak for themselves.

Doubling stocks had 34 winners in the year 2000. In 2001, they had 47 winners with an average gain of just over 88% per trade. In 2004, their newsletter subscribers had 36 winners out of 43 of Michael’s picks which earned the Doubling Stocks clients a combined sum of $196,000 in a small number of trades. Michael’s system for trading penny stocks is structured in three parts. At first, you must review a half-page of recommendations that he will send you. You then place the trade online or with you broker over the phone and then finally check back regularly to see if you have earned double, triple, or even quadruple your money back.

However, here’s a word of caution. If you are thinking about purchasing the newsletter that they offer at Doubling Stocks, I urge you to remember that their picks are just what they are – picks. They don’t always work in your favor. Again, before investing all your savings into a stock trading program, please make sure that you do your home work first, so that you minimize your risk. The Doubling Stocks Program may be the perfect thing for you or may not be. I reiterate that there have been many people that have become rich by investing in penny stocks smartly but there are others that have lost all their savings on it as well. Great picks are great picks only for so long. Timing your buys and sells is almost as important as knowing what stocks to buy and sell

To learn more about Michael’s penny stock trading program, visit DoublingStocks.com. I think you will find that they are one of the best selling newsletters for a reason.  They also have a 60 day free trial.






Turbo Tagger

]]> http://dollarcreater.com/fast-and-the-furious-trading-penny-stocks-can-be-dangerous/feed 0 Government Policy Rewards CEO Lying, So We Get More of It http://dollarcreater.com/government-policy-rewards-ceo-lying-so-we-get-more-of-it http://dollarcreater.com/government-policy-rewards-ceo-lying-so-we-get-more-of-it#comments Fri, 22 Aug 2008 05:32:05 +0000 IdeaMan21 http://dollarcreater.com/?p=109

Increasingly Fannie Mae and Freddie Mac are looking like little more than devices to transfer money from the pockets of taxpayers to the pockets of Fannie and Freddie senior executives. Former Fannie Mae boss Franklin Raines paid himself about $50 million for years in which, we now know, the company lied about its earnings in order to inflate executive bonuses, while management was playing fast and loose with other people’s money.

Beginning in 2007, Fannie Mae and Freddie Mac went off the cliff, their stocks plummeting to less than 20 percent of their previous values, and taxpayers were put on the hook as guarantors of the firms’ bad management decisions. The Congressional Budget Office estimates the Mae-Mac debacle will cost taxpayers $100 billion or more. Yet Freddie Mac CEO Richard Syron was paid $14.5 million for 2007, including a $2.2 million “performance bonus.” Syron has taken home $38 million total from Freddie in the past five years. Fannie Mae CEO Daniel Mudd got $14.2 million for 2007, plus a substantial prepaid life insurance policy and other perks including “financial counseling, an executive health program and dining services,” the Washington Post reported. Hey, $49,000-a-year median U.S. households, you are being taxed for millionaire Mudd’s “dining services.” Bon appetite.

Executives receiving very high pay justify their deals on two grounds: that they are risk-takers in high-pressure situations, and that they have valuable expertise. Now we know that no one at the top of Fannie Mae and Freddie Mac took any personal risks — everything was federally guaranteed, and all mistakes billed to the taxpayer. The New York Times reports that Syron was repeatedly warned in 2004 that the organization was taking on bad loans, and did nothing. Syron justified his inaction by complaining to the Times that he was under pressure from various Fannie constituents.

That’s why he was paid so much, to take the heat! Yet he took no heat, rather, devoted himself to avoiding responsibility. If things go well, executives are lavished with money and praised as risk-takers. If things go poorly, executives are lavished with money and blame others.

And just what incredible expertise do Syron and Mudd possess? They made billion-dollar blunder after billion-dollar blunder; they failed to realize things as basic as buyers borrowing without documentation of income may not be able to repay loans. People chosen at random from the phone book could hardly have performed worse. Yet the federal bail-out legislation just signed by George W. Bush does not require them to give back any of their ill-gotten gains.

This is the core lesson of CEO overpay scandals: The corrupt or incompetent executive always keeps the money. He may be caught and embarrassed by bad press, but he keeps the money while someone else — shareholders, taxpayers, workers — is punished. Raines recently settled a federal legal complaint by agreeing to return about $3 million of his $50 million, but kept the rest; his employment contract was worded such that even if he was malfeasant, whatever he took from company coffers was his. Hilariously, federal prosecutors claimed victory because Raines “surrendered” to the government a large block of stock options — options now worthless, owing to the Fannie Mae decline Raines helped set in motion by lying about Fannie numbers. Until Congress enacts a law that allows money taken by corrupt or incompetent executives to be recovered, the lying will continue. Lying by CEOs is what society rewards!

Why does Congress tolerate the swindle aspect of Fannie and Freddie? For the standard reason: Congress is on the take. Lisa Lerer of Politico reports that in the past decade, Fannie and Freddie spent almost $200 million on campaign donations to Congress and on lobbying members of Congress, some of the lobbying money going to former members.

This year, for instance, Fannie gave the legal max of $10,000 to Speaker of the House Nancy Pelosi and to Republican House Whip Roy Blunt, neither of whom face meaningful re-election challenge. As for costly lobbying, the implied deal is: Don’t rock the boat while in office and someday you too will be a former member getting easy money to lobby former colleagues. During Senate debate on the Mae-Mac bailout, Majority Leader Harry Reid refused to permit a vote on an amendment that would have barred Fannie and Freddie from giving money to members of Congress. Reid did not merely oppose the measure, he refused to allow the Senate to vote on it — so that members of Congress could remain on the take, without having to go on record about the matter.

Now that taxpayers are covering Fannie and Freddie’s cooked books, the $200 million diverted to Congress in effect came from average Americans, forcibly removed from their pockets — and thanks to Senator Reid, more will be forcibly taken from your pocket and placed into the accounts of senators and representatives. This is what TMQ calls a Sliver Strategy. The Sliver Strategy is a means to disguise embezzlement. Congress looked the other way while Fannie and Freddie approved vast amounts of bad debt, in order to shave off a sliver for itself — in this case, the $200 million in lobbying and donations. Had Congress simply awarded itself $200 million, editorialists would have been outraged. Because the money was slipped in to a larger fiasco of much greater sums wasted, Congress got away with it.

This is from a Sports Editorial on ESPN.com written by Gregg Easterbrook. He writes every Tuesday during football season and covers everything in the NFL and the world in one column. He’s good.

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