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Options Trading Consequences

Friday, October 31st, 2008

Just about all the pundits have been wrong. I’ve been following some of them even way before I started online trading and options trading. None of them called this.

A very few did say that they thought that the sub prime lending would have consequences, but they did not predict in what manner. They mostly said that it would have an effect on a few banks, but never did they say the entire system would melt down.

It’s ironic that nearly twenty years ago, in the late 1980’s, that there were a load of books and financial gurus who predicted the next Black Tuesday and Great Depression, and of course when that didn’t happen, they fell out of favor.

The Panic of 1987, which drove stocks down then over 500 points, was an enormous percentage point drop, but now drops like that are happening every day.

Of course, the banking and finance system has not quite melted down. Nobody really knows how bad it is.

Yesterday, Hank Paulson, forced some of the largest banks to sell stock to the federal government. Some of the banks protested, like Wells Fargo, as they were not in danger, had a strong balance sheet, and did not want the federal government owning such a large voting block of stock. There were obviously some shotgun weddings.

None of this is restoring confidence. Bad news continues to flow in across the world. Yesterday the bad news came from Switzerland. Both big investment banks there, Credit Suisse and USB, have been nationalized.

This is Switzerland — home of the Swiss bank! These banks survived the Great Depression and World War II. Now they’ve been done in by a bunch of lower income Americans and the banks and the politicians that set off this mess.

I’m not sure what can be done. If trading is halted on the exchanges, it would probably only be a break in the carnage.

If the government got out of the way, the markets would totally collapse, which may happen anyway. If that happens, real wealth will be lost, but others will step in to buy. There is money out there — waiting.

Today and tomorrow will be fascinating days, to say the least. If the market goes below 8000, then we may see another rush to sell, people moving out of mutual funds and into cash, and people and institutions stashing the money in the mattress, so to speak.

Each day is something new. I wish it weren’t. Being my own online broker certainly presents me with some challenging times.

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Leave It To The Online Stock Broker

Friday, October 31st, 2008

Stock trading has made my life simpler, but has also kept me up at night because I am glued to the screen, searching out events in global markets as they unfold.

Tara, my wife, has told me that I haven’t slept so little since September 11. That’s true. Perhaps leaving the work to an online stock broker is not such a bad idea.

I’m trying to do a couple of things with online stock trading and online options. One is to protect our holdings. The other, is to make some money. There will be few times in a lifetime when there is such a buying opportunity.

It’s true, though, what they say about not knowing if the markets have hit bottom. I believe the markets have further to fall. But picking the bottom is not an easy task. The blood is seeping out of the cracks, but it’s not yet running in the streets.

Panic has reached the retail level. That happened last Friday.

This Friday is triple witching, and it could be a blood bath.

Still, it’s hard to cover my own positions the way I want to, due to the cost of hedging. Still, to not head will cost me a lot more in the long run. In fact, it will cost me the long run. This could be an extended bear market not seen since the 1930’s.

So, a lot of my nights have been spent glued to this computer. Even at work I’m regularly checking the markets.

I’m thinking not much will spring to the upside until after the presidential election. Even then, there is that phase of uncertainty that happens between election and taking office.

This could be a battered market for some time to come, with nobody really piloting the ship for a long time.

For the longest time, a market meltdown has been predicted. Often, the predictors have been off by decades or so. I remember in the late 1980’s, there were all kinds of fear about stock market crashes, and none ever happened. The only thing the warnings did for me is convince me to buy some gold coins. I loaded up on gold coins, St. Gauden’s and others, when it was hard to give them away.

I kept them, because I liked the beauty of the coins, not so much that I ever thought that they would come back in value or actually have to serve as the last resort of worth. I pretty much thought that markets were basically under control and a massive meltdown would never happen again.

I was wrong, obviously, but at least I was not totally unprepared.

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Options Brokers Assuage Clients

Friday, October 31st, 2008

We had a history lesson today at our online stock trading club.

Since the markets have been on a roller coaster ride we have been trying to reassure each other that we know what we’re doing.

This has met with limited success. When people are down twenty, thirty or forty percent in their assets, it can make for a nervous time. Even the online brokers are having a tough time assuaging their clients.

Online stock trading and options trading for me has been very good, but I admit that I’m as confused at the rest in what to do going forward.

I will work to hedge my long term holdings some, by purchasing some puts. And then as addi-tional security I will look at buying some calls for the same. Yet, I’m not alone in doing this, so rates are not going to be rock bottom for any of these.

So this morning, Mr. Callahan came back to talk to the club. He was brought in by a member who figured that talking to someone who had seen a great deal of trading history might help us find our own individual directions.

Mr. Callahan, was a trader for many years down at the old Chicago Board of Trade. He was actually actively trading when Black Tuesday hit, in 1929. He was very young, maybe 21. He is 101 now.

Mr. Callahan apologized when he met us. He was still wearing his athletic clothes from his morning routine at Cardinal Fitness. And he was planning on running a few miles after he talked. He declined any offers of food, as he preferred to run on an empty stomach.

Mr. Callahan’s advice was to watch the fundamentals. If the credit markets loosen, there still has to be demand for credit, like any other product. Watch the earnings reports. Most will not be great.

Business of all types will be pulling back. Pulling back means less demand for credit to finance expansion.
Check the consumer, too, he added. Most consumers are leveraged to the maximum. They have very little disposable income left. Plus, many have taken a hit in their retirement ac-counts and their biggest financial asset — their homes– have sunk in price. This does not foretell a rosy future.

Still, he said, there is money to be made. Some investors will be energized by the recent gov-ernment action and will drive up certain sectors, and then will oversell other sectors reacting to bad but not horrible news.

Be ready then.

He reminded us before he jogged off that he made a tiny fortune during the Panic of 1929. He had been holding short positions in a lot of stocks, and wasn’t tempted back into the market on a “dead cat bounce”.

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Online Stock Brokers’s Doubts

Friday, October 31st, 2008

Today’s attitude is a bit more picky.

Online stock trading and online trading have never been more challenging and more re-warding. Without today’s modern advancements I’d be in the dark until I came home from work. Or maybe even later.

Instead of reading what happened in the paper the next day, just like the professional online brokers, I can at least get nearly real time accounting of what’s going on.

Online stock trading is probably helping a lot of people sleep at night. Nothing is worse than not knowing.

As I expected, financial stocks are showing solid to the upside, but consumer driven stocks, like Microsoft are weak. This probably signifies that everybody is looking ahead at a soft economy — a recession.

It would be surprising. Trillions of dollars have gone somewhere, and trillions are being spent by the public sector to make banks whole. The trillions lost and the trillions spent have to come from… us.

So, clearly, there will be a slow down in the economy.

Coke is down, too. And I just heard that Pepsi will be laying off workers.

I took another look at the tech stocks. Amazon is down in a big way, 5.8%, and it joins Intel and Google and Oracle. Google is looking like a steal at $376 a share. I might purchase some.

The tech stocks that were up a bit at last check were Apple, IBM, Sun Microsystems, Ebay and Advanced Micro Devices.

It’s understandable on some of these tech stocks as to why they might be up. Ebay, especially. The question is, will their small rally last?

Next, I will take a look at Johnson & Johnson and see how they are doing. Also 3M.

I’m just wondering if we are beginning to see doubt creep back into the markets. Not so much doubt now about the banks and financial companies, but doubts about what the consumer might do.

Most consumers are in a bad way. They have no options, being leveraged up to the hilt with credit card debt, home equity loans, car and student loans. There is no end to the consumer issues, and this most likely won’t be a consumer led recovery in the recent sense of it.

The past couple of recessions have had the consumer step up, but now, with debt being so high and with so many feeling poorer with losses from their 401(k)’s and devalued housing, it is a real question of what the struggling consumer can do. If anything.

Now the markets might pause to look at that, if they think the banking crisis has been tamed.

Posted in Stocks, Bonds, and Equities | No Comments »

Helpful Essentials - Forex Market Trading and How to Behave on the Market

Friday, October 31st, 2008

Forex trading is managing through the Forex market. To make it clear, with the foreign exchange market you trade in what are called currency pairs. This a rather simple process to understand: you select one currency from one country and determine whether it’s going to do better or worse against another country’s currency or not. In order to determine whether a particular currency is going to do well or not you should study some basic things and the most valuable to find out what is the situation in the given country. That’s why so-called fundamental analysis is used.

With technical analysis, though, you read Forex charting that tells you how a particular currency is trending and you get the following information: Is it going up, going down, or staying the same against the other currency in your pair? Has it been doing so for a while, or has it been volatile? This is how it is possible to make money trading currency.

You should establish something called a “demo” or practice account with the Forex trader you pick if you are just a beginner in Forex trading market. With demo trading, you can do everything the average Forex trader does and the only difference is that you don’t have to use real money. Doing this way you will have the opportunity to practice without risking any money.

Now you understand that very important point - with Forex trading, you are absolutely taking a risk when you do trades in the attempt to make money trading currency. It is a very lucrative market indeed and it is mainly for those who know what they’re doing, but still there is no 100% guarantee that there will be a good (or even any) profit. That’s why, demo trading also lets you do something very important.

You should know that even the most successful Forex traders do lose money sometimes. Absolutely no one wins on every single trade. You must learn to work with no emotions out of the equation, because Forex trading does require a cool head. You should know when to get out of a trade that’s losing instead of staying in, in hopes that she’ll make the money that you’ve lost back. That also means that in the case if you’re winning on the trade, you need to read and analyze charts charts.

If you are engaged in Forex trading, you have to learn how to do Forex charting. As many practice as possible and the proper Forex charting techniques can make you a really successful trader, as long as you know what you’re doing and can handle yourself.

P.S. Make sure that you understand that how dealing desk issues can save or waste a lot of money.

Posted in Foreign Exchange Trading | No Comments »

Helpful Secrets - Special Forex Trading Software Solutions

Friday, October 31st, 2008

Forex (FX) trading software should be to optimize your profits over the long term as opposed to maximize your profits in the short term. It also must function well in all trading environments and be able to produce consistent profits. There exist a lot of Forex trading systems on the market today that is why the decision which one to buy could seem confusing at first. Each and every FX trading system offers a distinctive approach to trading and is programmed a little differently.

Is this cheapest online trading available?

The first step to make if you are an experienced trader and are now looking to upgrade from the manual trading process to computer based system is to examine your on individual method of trading and clearly decide what you are really looking for.

If you have not been successful trading and you are attempting to blame the software then you really should take a long hard look at yourself and determine if it’s the software or is it you. If you decide that it wasn’t the software’s fault, then instead of purchasing a new system immediately you are highly recommended to take additional online training course.

Lots of the most popular FX trading software on the market today has been examined many times by the developers of the software and many independent testing agencies. As long as the software you purchase is a state of the art system is has been proven that it is capable of producing long-term profits if utilized properly.

Your first investment before attempting to jump right in the Forex Market with an automated trading system must be in one of the many online courses in order to be educated about all the details of this market. The cost of these courses is so minimal that they are easily made up with one successful trade that it is just unconscionable that anybody whom has little or no knowledge of the markets would want to start trading without first taking a course. This is, by the way, this is one of the cheapest online trading.

When selecting the software there are only a few vital things to consider. The first one that you should make is to reassure that you are buying a top-level program that is updated as required by the market movements. Then you should choose a software that is based on your personal profile of trading and make sure you are selecting a proven system and check once more that it is a general system as opposed to one that focuses on a specific style of trading. The selected software can really make you a hero in the eyes of your family but this will happen only in that case if you are well educated on the markets sufficiently to understand it.

Learn more about free Forex signal issues.

Posted in Foreign Exchange Trading | No Comments »

The Boise Home Search And Boise Homes Uncovered

Friday, October 31st, 2008

The Boise Real Estate market is changing everyday. The values change and the business side does as well.

Remember that the listing agent is not there to sell your home necessarily, but they are there to market your home. Marketing should include sign, lockbox, flyers, MLS, Realtor.com, company website, real estate magazines, virtual tours, etc. If they happen to sell the home themselves that can be great, but typically it will be one of the other 4,000 - 5,000 agents or more that are active in most markets that will bring a buyer to the home.

When you are looking so sell your home, one of the major considerations when you choose a listing company or listing agent is how much do they charge. In the US real estate market, you can typically expect to see a 6% commission which is not set by law and is negotiable. In Boise you will see a range, even as close as 5 miles away, the real estate commissions are typically a bit lower at 5.2% and nationwide the average is about 5.6%. Some average rates even extend higher 6%.

Boise ID Real Estate

This is called Boise MLS cooperation. This is imperative to have when you are looking to get your house sold. Make sure your listing agent lists your home on the Boise MLS and offers a 2.5% to 3% commission to the buyer agent. Keep in mind that a buyer agent may not show your home if they get paid less, so a 3% commission is recommended. Again, this may differ depending on the market, so talk to agent to see what is typical.

Boise Home Search
Discount Real Estate Companies

You may of heard of some local real estate companies that will list your home for a “flat fee”. This is where you have to be careful. I honestly think that this is just a way to get into your door and present to you. What they don’t tell you is that they are not going to cooperate with other companies and offer a buyer agent commission. in this scenario, you just lost 4,000 - 5,000 or more agents in the you area that won’t be working to sell your house. They won’t even know that it exists. This directly reflects on your market value because suddenly the demand is way down for your home. Not to mention, they also have to very aggressively price your home even to get looks.

Boise Homes
You get what you pay for most of the time, but not all of the time. If you are paying out 6%, make sure your are getting the best marketing plans out there. Much of the marketing of homes is moving to online marketing. Over 90% of buyers search online for homes, so it is imperative that they see your home in their search.

Vizions Real Estate can help you sell your home for top dollar in any city including:

• Caldwell
• Garden City
• Donnelly
• Mccall
• Meridian
• Garden Valley
• Eagle
• Boise
• Star
• Middleton
• Kuna

Happy House Selling!

Ben Janke is a Idaho real estate broker that has written free real estate guides that you can access by clicking the following link Boise Real Estate.

Article Source: http://EzineArticles.com/?expert=Ben_Janke

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Automaker Viability And Options Trading

Friday, October 31st, 2008

I had to ask myself about the capability of the US automobile manufacturers. They are not looking good at all right now, but there could be some opportunity to find some real bargains for stock trading or options trading.

Who will endure is the question. Or, what parts of which of the Big Three US automakers will survive?

As any individual or online broker is aware, a smart pick will mean some decent returns. A bad choice will mean big losses.
Fortunately, with online stock trading, it is much easier than the last crisis to keep track of investments.

Right now, the government has just guaranteed 25 billion in low cost loans to the Big Three.

First and foremost are the labor costs. The Big Three have labor expenditures that are much higher than their competitors. Right now, it looks that the higher union wages, plus medical benefits to those employed and retired look like a non-starter for considering further investment; however, this structure cannot stay in place forever.

What the automakers may be hoping for is that there is ultimately a government health care plan that will take the burden of paying for health care off the books of the manufacturers. This is no doubt a mid-term plan or way of thinking. Even if an administration is elected that favors this type of single payer plan, it will take a while to get it set up. So, those who are looking out maybe five years can consider relief to the automakers in this regard then.

Labor costs are more difficult. Any ground gained by the unions are not likely to be given back without a fight. In fact, there are those who remember the plight of Eastern Airlines. The airline, in dire straits, asked for concessions from its un-ions so it could carry on. The unions didn’t acquiesce and Eastern Airlines went out of business.

So the US automakers are facing some difficult issues. They may not be a place to put any money or faith in for the short and mid-terms, even though the federal government seems to think otherwise.

The most important factor, probably, is the cars that the Big Three are making. Who wants them, and in how much quantity?

My attention came to their competition. If there are to be two or three automobile manu-facturers left globally, no doubt they will be owning all or parts of the US automakers.

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Nearly New Lewisville Property in Texas Gives the Ultimate in Comfortable Living Conditions

Friday, October 31st, 2008

Just outside of the Dallas metropolitan area sits one of the most treasured suburban settings known as Lewisville, Texas. Known for its ability to balance the character of a small town with the personality of an urban metropolis, nearly new Lewisville property has come to attract a varied group of smart home buyers each year. Peppered with a number of venues wherein residents enjoy world-class shopping, delicious dining, clear blue lakes and easy access to the airport, Lewisville has an abundance of attractive features to offer both visitors and residents all year long. Plus, the array of residential options afforded to potential home buyers makes it quite easy for interested parties to discover the home of their dreams in Lewisville.

Posted in Real Estate | No Comments »