Tuesday, December 30, 2008
I wanted to send it to everyone in case you somehow missed it. The only thing I would add is something Garth Brooks told me years ago when I had a chance to interview him about his success.
Garth told me "It is your dream, don't let anybody steal it from you".
If your dream is to become a world class consistent trader - don't let anyone steal it from you!
Thanks again for reading my blog!
Doug West &
Your Friends @
by Mack B. Stevens, Senior Broker, Cannon
Trading futures is an alluring business that allows an individual a lifestyle filled with many freedoms not available to most working people. This business requires traders to posses a unique set of qualities. The most critical quality a trader needs to have is discipline.
Discipline trumps knowledge. It trumps experience. In fact, without discipline very few traders survive to have enough experience to draw upon as an asset in their trading. The need for discipline is amplified by the very structure of futures trading. The leverage available in futures trading amplifies every decision that a trader makes. Every decision, good or bad!
Everyday life requires us to constantly make decisions. Do I buy the chicken breasts at $4.95 a pound, or do I buy the hamburger at $3.95 a pound. These types of decisions are non-leveraged decisions, so the impact overall is minimal. We are not buying or selling 400,000 pounds of hamburger as we do when we trade 10 contracts of cattle, while "paying" (margins) only a fraction of its total value.
In trading futures, one needs a trading plan. Some of these plans can be purchased for thousands of dollars. Some can be learned after attending a trading school for a week or so. Some can be developed by the individual trader after months or years of research. However one comes to his or her trading plan it is useless without discipline. Traders who have their plan and then stop using parts of it during the trading day are doomed to having increasing losses, usually large ones as typically the most discarded part of a trading plan is one of the risk control components.....stop orders and/or position size. A trading plan that is implemented with the proper discipline 75, 85, or even 95% of the time is doomed. For whatever reason, traders seem to have a breakdown of discipline at the most critical and damaging times. This is damaging to their equity and their psychological balance. The greatest trading strategy ever developed will prove to be disastrous to your account if it is implemented with a lack of total discipline.
This factor is what makes or breaks traders. We all know the difficulty in maintaining discipline in our everyday lives. Be it a diet, or an exercise plan, or even keeping toxic people out of our lives, constant discipline is very difficult to achieve. This is the key reason most traders are not realizing profits in their trading. As stated earlier in this article, futures trading amplifies our decisions in a way not seen in the rest of our everyday lives. Discipline is the single most important component in a successful trading strategy. So, rather than spending another $5000 on a new "black box" trading ideas, spend some time, and money if necessary, to learn more about yourself as a person so that you can better develop the strength to maintain trading discipline 100% of the time. This is a challenge to say the least but the difference in your life and in your trading account will be staggering! Good luck with making the change. The efforts in achieving this high level of discipline will be efforts that are exciting and rewarding. Let 2009 make your trading all that it can be!
IMPORTANT PLEASE NOTE: TRADING COMMODITY FUTURES AND OPTIONS INVOLVE SUBSTANTIAL RISK OF LOSS. THE RECOMMENDATIONS CONTAINED IN THE LETTER IS OF OPINION AND DOES NOT GUARANTEE ANY PROFITS. THERE IS NOT AN ACTUAL ACCOUNT TRADING THESE RECOMMENDATIONS. THESE ARE RISKY MARKETS AND ONLY RISK CAPITAL SHOULD BE USED. PAST PERFORMANCES ARE NOT NECESSARILY INDICATIVE OF FUTURE RESULTS.
Tuesday, December 16, 2008
As we were all on our team call trading the mini Dow index and waiting on a set up, the subject came up of how many folks are now losing their jobs because of the weak economy. If ONLY they knew how to trade the index. Thinking of it brings back thoughts of my own lay off from AT&T back in 1992.
The latest economy reports show more and more folks ending up on the unemployed rolls. The real statistics are most often worse than what is reported.
My guess is that the situation will get Much worse before we see any improvement in the job numbers.
I have always been a big fan of multiple income streams (even before that became a catch-phrase), and I think they are more important now than ever.
When I was laid off my nearly 10 year job with AT&T back in 1992, I saw first hand how important multiple income streams were. At the time, I had a part time mail order biz (and had been tinkering with that since I was a kid). I looked at the lay off as a good opportunity to get more serious about my business. I also had been doing some investing (my best-ever stock play helped BIG back in those days), and had a little network marketing income.
Many of my AT&T coworkers had no other source of income, and I clearly remember a few grown men in tears when they walked us all out the door that morning!
I would MUCH rather have five sources of income that pay me $200 a week, than to have a J.O.B. that pays me a grand a week! If you still have a job, you need to take this info seriously - NOW! If you are one of the millions of folks that recently lost a job or your only income stream, you need to take steps NOW to correct that (you still have time - perhaps a severance package and/or unemployment insurance checks to get you by - but please don't wait till they run out to get going).
How do you start to create multiple income streams? Here are a few areas that are available to most people:
* Online Income
Many things fall into this category, affiliate plans, blogging income, Adsense dollars, online jobs, marketing your own products and/or services, eBay and other auctions, & more.
* Investment Income
OK, this one may be tougher than ever, and if you barely have money to live on, how do you start to invest! I am partial to index trading, and that does not require a lot of money to get started, but to be really good at it, you need other income streams too.
* Network Marketing Income
Don't turn up your nose at this one. I have companies sending me checks that I have not worked in years. While it is true that network marketers often talk about the top guy who is making $500,000 a month, but there are a TON of folks who make a few hundred a month. Not life changing in and of itself, but as part of your multiple income stream strategy, not bad either.
* Cash Back Debit & Credit Cards
You won't get rich with this alone either, but the old saying is really true "If you watch the pennies, the dollars will take care of themselves". Pay Pal offers cash back on a debit card (which in my opinion is better than a credit card - you won't have the temptation to carry over a balance, which would cause interest charges and defeat the purpose of cash back)
* Interest Savings on Loans & Credit Cards
OK, this is not technically income, but if you save money off what you are currently spending, it comes out the same in the end - more money in your pocket and budget.
* Food Bill Savings
This is like the Cash Back cards, not really income but can be very important - especially if you just lost your job or sole income (like many folks who used to live on their stock market income). Try clipping coupons or join a coupon club. Eat at home more and quickly find more money left in the budget at the end of the month.
* Turn Hobbies Into Income
Like to go to garage sales? Turn that hobby into eBay income. Like to work on small engines or have some other hobby that can be turned into an income source? Don't sell yourself short here. Maybe you love flea markets? What if you could get an extra $200 or more a week by setting up a booth one day a week? Not enough to live on for most folks, but not bad as part of your multiple income strategy. You might even consider creating a booklet, ebook, book, or other info product on your hobby. If you are good at it, you ARE and Expert (you don't have to be the best to be considered an expert - there are folks out there who will pay you for what you know).
We have had affiliates of our Index Trading course earn up to $100,000 in a year. We've had many more earn from $5,000 to $30,000 in a year. What if you had 5 affiliate plans you liked (loved would be better - you'd be more passionate about them), that averaged about $5,000 each per year. You might be able to live on that. Add some other sources like the ones mentioned above and you might live very well!
You should always be looking for ways to add additional income streams. Remember, the more you have the better! If one dries up, you are not devastated.
The time to set up multiple income streams is before you need them, but no matter what your situation is, there is no time like NOW to get started. Keep it tuned here for more ideas on additional income!
Get more tips on how to build your income with Mini-Dow Index Trading Made Simple
Friday, December 12, 2008
1) Never Quit Improving Product Quality
I remember when anything made in Japan had a bad name. The cars they made were junk. The only reason they sold ANY, was that they were cheap. When you got in one of these vehicles it felt like you were climbing in a toy or a tin can.
What seemed to go unnoticed by the US auto makers was that Japan was constantly working on improving their products. The big 3 seemed bent on engineering cars that would quit right about the time the warranty ran out. So while the Japanese cars were on there way up, the US delivered some of their worst products in the mid 70's. Before they knew it, Japan had nearly caught up with them. Not much longer and the Japanese had passed them -which leads to our next tip:
2) Don't Underestimate Competition
For years GM and Ford spent the thrust of their advertising dollars blasting each other. In the mean time Japan focused on the wonderful features of their vehicles.
By the time Ford and GM stopped to look around, they were behind in sales of cars. It got worse when the Japanese started manufacturing bigger pick up trucks!
3) Marketing Only Works Long Term If You Have Quality Products
This tip overlaps a little with the first one, but now we want to tie quality in with marketing.
The biggest example I can think of when it comes to marketing inferior products has to be Microsoft. Before they had ever even thought of the visual interface provided by Windows (Any old DOS fans still out there?), Apple/Mac had nearly perfected it. However, Microsoft and Gates out-marketed Job and Apple. Now with the Vista fiasco (really is it much different than any other version of Windows we all bought - full of bugs until we all test it out for them) it looks like Mac may finally make a big run on them.
Probably a better example would be AOL. Remember those discs you used to get in the mail nearly everyday offering their dial-up service. Even for dial-up (YUK - but at the time we didn't know any better) they had about the worst service available! Yet, they were excellent marketers. So, they grabbed a majority share of the market. Sooner or later the quality caught up with them.
Some might argue that Microsoft and AOL still made a LOT of money, and that would be true. But, in the long run inferior products will always come back to haunt you, and that is what the big 3 auto-makers are feeling now. What if they never did let Japan get ahead of them in the first place. Sure, this economic slump would still hurt, but would they need to ask the government to bail them out?
When you lead the pack in your niche you can lose that fire inside of you. A certain arrogance can set in. You could easily get fat and lazy!
When billions of dollars are flowing in, it makes it easy to manage a company. The true test of an outfit is how they handle a downturn. That is when real management skill is needed.
So put these tips to work in your business. Never Stop Improving Your Quality. If there is nothing else you can do with the product, can you improve the service? Constantly monitor your competition, and stay ahead of them. Finally, keep on marketing your quality products and services. It will pay off for you for years to come!
Still looking for a way to earn money from home? Don't miss the post I'm getting ready to make on how you can Really cash in on current trends. Also - don't forget our Simple Index Trading Strategy & Training!
Wednesday, December 10, 2008
What many are wondering is how the auto maker's share of TARP funds (if they do indeed fund it with TARP) will affect them and their family finances.
Doug West, who has taught thousands how to increase their income online with affiliate plans, small business and, with Index Trading is available for interviews on the Auto Bailout subject and more.
West, who correctly predicted the outcome of Y2K, and other financial scares over the years has been right on the money about much of the financial crisis. He predicted oil's rise (before it was politically correct to do so), and it's decline (in time for readers & listeners to cash in on the down trend by recommending the ETF - DUG).
You may be alarmed to hear what West is predicting for the next several months (regardless of the outcome for U.S. auto makers).
To arrange an interview see West's media room page at:
West will share some excellent tips with your audience such as:
* How To Eliminate Interest From Consumer Debts
* How To Easily Accelerate Your Home Equity
* Pay Off Your Home Quickly & Save Thousands
* Why The Crisis Make's it Necessary For You to Be Debt Free
* A Simple Trade That Happens 1 to 5 Times a Week that can pay you up to 15% on Your Money in as Little as 1 Minute
He will also offer your readers/listeners a no-cost guide that will show them how to get out of debt and create tax-free wealth. While it may be too late for US auto makers, there is still time for individuals to act.
For more information visit:
Friday, December 5, 2008
Just got off of our daily trading call with my fellow traders and students, and we had a Great time. It was easy to see the market moving down this morning, and the simple patterns we look for were there. Most of us took advantage with some simple profits.
Terrence stopped in, one of our non-US traders. Terrence lives down in the beautiful Caribbean, and enjoys trading the index. (Many of us here are jealous and want to move down and join him - we want to all meet on the beach with our laptops and make money while enjoying the awesome scenery!).
Soon we were watching the trend change and the market start going up. A few went along for that ride. After we hung up, I did see an even stronger confirmation of the up move and did a couple more little trades for the day!
Some of the amounts I heard on the call were $1200, $900, $800, and $400. These are amounts that folks made in under an hour of looking for trades (most of our actual trades only last for a few seconds).
Are you facing a loss of job and income? If so (or even if no), isn't it time you learn how to trade the index with us? What are you waiting for. Even President-Elect Obama is telling you that it will take some time for any real economic relief comes. NOW is the time to learn a skill that can help you make money - Regardless of what the economy is doing.
If you are a radio show host, and would like to talk about Index Trading, the recession, what got us here, market conditions, and anything else, please click on the Media link on the left. We can offer you a show that will not only enlighten your listeners, but will entertain them too!
Post again soon. Have a Great Weekend!
Friday, November 7, 2008
With W in office, there was NO END to how big the swings could be! And thanks to the damage he was able to inflict on the world, the BIG swings and moves should continue for some time (take today's HUGE move - just one of the patterns you will learn how to cash in on as a member of our team)!
While Bush did not make many long-term friends with his presidency (even Billionaire Republican Donald Trump admitted on a recent CNN interview "this man has been a total disaster"), he has left a legacy on the markets. As an index trader, we will show you how to make BIG PROFITS with Little Trades from the "W" effect!!!
If you are like most folks, you have felt the difference in how far your dollar goes these days. BUT, if you could discover a simple strategy for cashing in NO MATTER what the market or economy is doing, that could solve your personal "W" crisis.
Think about it. What would an extra $1,000 a month do for you right now? What about a grand a week or even that much or more Per Day? You can do that and more with our simple index trading plan and strategy, and/or our awesome affiliate program.
Get more info right now and watch a video on Mini-Dow Index Trading Made Simple
Need Debt Relief? Get Doug's Debt-Free Report
Tuesday, November 4, 2008
We do expect the market to be similar today as investors try to get a feel on who the next president will be, and how that will effect the markets. The early news shows that the International markets are all excited at the thought of an Obama presidency.
You no doubt have heard analyst claiming that if Obama is elected the capital gains tax will go up, and investors won't like that. However, we have to remember that until January 20th he would just be president-elect and not the Pres.
Even when the new president takes office, he is not going to be able to raise ANY tax immediately. We need to also remember that politicians rarely do all they say they will do.
How does all this effect us as daytraders or Index Traders? Not much. We are just going to keep looking for those simple set ups that tell us a good move may be getting ready to happen Right Now! Yes, it may be narrow and ugly today -being election day, but good moves are sure to follow. That will be true no matter who the president or the president-elect is!
Get more tips on how to build your retirement income with Mini-Dow Index Trading Made Simple
Need Debt Relief? Get Doug's Debt-Free Report
Saturday, November 1, 2008
Consumer spending & GDP numbers released this week (after many "revisions that makes one have to wonder what exactly they were trying to cover up) were all very negative. Some analyst seem to be happy with the fact that the numbers were not worse than they were, but do we even have the real numbers?
My guess is that we have reached a temporary lull in the colossal down move (again as mini-Dow index traders we can make money no matter what the economy is doing - that is really the heart of this article -there has never been a better time to get started with us).
The Bank of England is strongly considering their lowest interest rate since their inception in 1694! Yes, we are in uncharted waters, and now is NOT the time to start thinking we have come out of the storm. Now is the time to learn a skill that can help you and your family survive in a DEEP Recession unlike the world has ever seen.
There is no example in history that matches the current financial crisis. Today we have the combination of shrinking credit, decreasing consumer spending, maxed out credit cards, and hardly anyone in American has any savings! How could these factors make a bad situation even worse?
The credit squeeze is still hitting hard on banks and businesses. We are seeing increasing down sizing and lay offs in the private sector. This is causing folks to spend less, which is creating less of a demand for new products and services. This will cause even more lay offs. That will mean even less consumer spending. And, don't forget, this all comes at a time when most Americans have little if anything in savings. Savings that could help them get through times like these.
Are you starting to see why NOW more than ever - you NEED to learn a skill like Index trading??? A skill that is not effected by the economy, or GDP numbers, or layoffs, or consumer spending, or the credit squeeze, etc. etc...
It's entirely possible that MANY investors will not return to stocks again. We have just went through the worst drop for equities in a single month since 1932! Many retirees may never buy another mutual fund or stock again. Younger investors may shy away from stocks altogether.
Global stock markets have seen a 25% drop in value during October. We now have the US government taking preferred stocks in financial institutions, basically turning the banking industry into Federal agents. The free market as we know may never be the same again.
However, as with any crisis, there are those who will come out smelling like a rose. We feel that Index traders will be of that group. There is going to be an index trading somewhere, and we will be there following it up and down!
Get more tips on how to build your retirement income with Mini-Dow Index Trading Made Simple
Need Debt Relief? Get Doug's Debt-Free Report
Friday, October 24, 2008
If your day trading strategy is consistently successful on your demo account, then what is the difference when you go live? Mindset! It all boils down to that in your trading (in my opinion this is true of life in general, but you see the results immediately in trading - especially day trading).
I really hate to call what we do as index traders, day trading. That is only because of the negative connotation the term brings to mind. Stock trading is what most people think of when they hear the term day trading. Regardless of what type of trader you are, you will have to come to terms with the fact that each trade depends on YOU. What frame of mind you are in at the time you place those trades will have a HUGE impact on how many of those trades are successful.
Most traders think that it all boils down to the technical and/or fundamental analysis of the markets. This is where they spend all their time and money, but they never get around to working on the mindset. They feel the real key is in becoming a great market analyst. However, the world is FULL of good market analyst (just watch CNBC or Bloomberg for examples) who are not able to trade. They too didn't have the right mindset and had to take jobs instead.
So what is the right mindset for a trader (or day trader)? That would take volumes of articles to answer. A good start is to read Mark Douglas' book "Trading In The Zone". Don't end your mindset training there, but it is a good start.
Another good exercise is to keep a traders diary. Write down what you were thinking and how you were feeling as you made your trade. Do this immediately after the trade so that you can be as accurate as possible. Do this on winning trades and on unsuccessful ones too. You should notice that on your winning trades everything felt easy and sure. Once you notice the difference, don't enter trades unless your mind is in the correct frame!
It's amazing how the human mind is able to pick up on the overall mood of the market. Douglas calls this being "In The Zone". We have always referred to it as getting a "Market Feel". Some traders have felt that it was impossible, while others gain that market feel advantage rather quickly. The difference is always in the mindset of the person. Some people are naturally much more in tune with their emotions, and they don't let them effect their mind while trading.
Many traders get hung up in all the technical tools that are available today. They reason that if they can just add the right tools, they will become successful traders. After working with hundreds of traders over the years, I can tell you for certain that you will NEVER be successful unless you have the right mindset.
Monday, October 20, 2008
Because of the faster movement of the Dow versus the S&P 500, the mini-Dow more closely follows it's big board parent.
So if it is just a matter of speed, then the mini-Russell would be even better right? Not exactly. The problem with the Russell is the low volume. This will no doubt change in the future. The mini-Dow had too low a volume for our money just a couple years ago, but that has now changed.
One more reason why we prefer the mini-Dow is that we like no-cost tools, and it is much easier to find a reliable Dow chart. In fact there are many online that work just fine.
No matter which Index you prefer, we feel it is an advantage to watch the big board chart, and not the mini chart. We also prefer the 5 minute time frame.
Many traders watch both, which is what I did years ago before deciding to focus on the big board. Here's why. I found that I would not move on what the mini chart was telling me unless I confirmed it with the big board. A popular confirmation among traders. It finally hit me that if I would not make a trade without confirming it with the big board, then why did I need the mini chart at all?
When I dropped the mini chart and focused on the big board movement, my trading improved. I have since confirmed this strategy with Hundreds of my students and other traders. Just recently, one of my students who moved on to using the mini-chart (a paid service I might add), came back to our style and is now focusing on the no-cost big board chart we use. He also confirmed that his trading improved, and he now sees why we focus on the big board.
The mini chart (even in the 5 min time frame) is like trading with a 1 minute chart. There are too many head fake moves that get you in a trade before it has fully developed. The big board averages some of those moves out for you. It keeps you on the sidelines when you should be. Sure, you might not get in as early on some runs, but in the long term it will save you!
It is difficult to catch any move from top to bottom or vice versa, but by watching the big board you can fairly easily get a nice chunk out of the middle (or many chunks with our BIG MONEY small trades strategy). A few nice chunks a week will keep you from needing a bail out plan!
Doug West has taught thousands how to grow wealth with
simple Index Trading and by eliminating debt & interest
charges. Get his Debt-Free Report at no cost.
You can also watch him make live Mini-Dow trades by visiting his site.
Thursday, October 16, 2008
The so called "Experts" on CNBC, Bloomberg, and other news networks are trying to call the bottom of the crisis. Even Jim "Mad Money" Crammer has been telling his loyal stock-trading followers to buy GOLD! He also is saying that long-term buy-an-hold stock trading will NEVER be the same. We couldn't agree more Jim!
However, for Swing Traders, the market is Better Than Ever! We appreciate and enjoy trading the Index. When the market is swinging, there is No Better time to be trading the index. While we like the Mini-Dow, Any index sure beats trading stocks these days (and always has in our opinion).
While stock and commodity traders are trying to figure out how low this market could go, Index and Swing traders are willing to follow it down as low as it wants to go. "Let it Fall" is the cry of the day.
Think about it, why would anyone in their right mind want to buy a stock these days? Or an ETF for that matter? With simple index trading you don't have to be concerned about PE ratios, insider trading, golden parachute escape plans, decadent officer vacations, earnings reports, or all the other YUCK things that come with picking stocks!
If you were going to short a stock you still need to do your research on all the above and more. And if you short it, the stock might be up 15% in the morning before dropping to minus 20% in the afternoon. Most stock traders are not able to hang on for that type of roller coaster ride.
If you trade the index, the set ups come to you. No research, we don't really even care if the CEO runs off with all the money. We just want the market to MOVE! The more it moves the better. And, we really don't care which way it goes. Up or Down, just as long as it moves.
If you have EVER even thought about Index and/or Swing trading, now is the Time to Act on it! While all the stock investors are scratching their heads, you can be on your way to the bank (on second thought, maybe it would be better to keep it under your mattress).
Thursday, October 2, 2008
While big companies are falling to the way side, the firms with no debt and cash reserves are doing just fine. That is Exactly the position you need to be in as an individual. If you are not paying the typical amounts to interest and taxes, you are going to be in a MUCH better situation than most people are these days.
No doubt inflation has effected the family budget.
The Bush oil men started their plan of bringing on HUGE oil and gas prices several years ago. They apparently never stopped to think that if the common folks are paying 3 times what they are used to for gas, they might not be able to pay their mortgage bills, car notes, or credit card usury fees (which many families have been forced to run up to pay for their gas).
Now the financial backbone of the country is in crisis, and Wall Street is scratching their heads trying to figure out what went wrong.
Of course, now that Lehman, Merrill Lynch, Fannie & Freddie and many others in the financial sector have waved bye bye, folks are wondering where it all will end?
My guess is that this HUGE economic mess is no where near finished. Who knows, it might even lead into the Great Tribulation mentioned in the bible. No matter what happens, we better all take steps to protect ourselves now, and not wait on Washington to fix it.
Statistics show that most folks who declare bankruptcy could have saved themselves with just a few hundred extra dollars per month. That is a very realistic goal for most home biz entrepreneurs. There are many ways to do that much and More online.
If you are in the business of helping folks created income streams at home and/or online, then you could likely be part of the solution. Our feeling is that it will be the entrepreneurs of the world that pull us out of this.
We favor the strategy of increasing income, and decreasing debt at the same time. Many people will wait until they are completely debt-free before they look toward increasing income. Why not do both at the same time? With just a little planning, you can be well on your way to the lifestyle you want. (In many cases you can cut out the fat and find additional money for debt reduction without increasing income at all.)
One thing is for sure, with their record, we can't wait for Washington!
To get our FREE PDF REPORT & ACTION PLAN VISIT:
Friday, February 15, 2008
Let's see, if you are already in debt up to your ears - like the US government is, how is sending out free money going to stimulate the economy? And, how is that going to help the US government?
OH, don't forget our friends over at the FED. The Reserve! The agency that is owned by the bankers. That masquerades around like they are part of the government. What many folks still don't know is that they all pulled a fast one on us by sticking that word Federal in front of their name. The same thing the guy at Federal Express did when starting his company.
Frederick W. Smith founded FedEx. I clearly remember years ago when he was on 60 minutes, he said that by the time folks figured out that he was not part of the government his company would already be well on it's way to BIG MONEY! Can't blame his reasoning? What a PLAN! IT WORKED for the FED why not FedEx too?
Let's quote right from the FedEx web site:
"Federal Express was so-named due to the patriotic meaning associated with the word "Federal," which suggested an interest in nationwide economic activity. At that time, Smith hoped to obtain a contract with the Federal Reserve Bank and, although the proposal was denied, he believed the name was a particularly good one for attracting public attention and maintaining name recognition."
I'm sure Smith did want a relationship with the Federal Reserve - who wouldn't! These guys have the legalized right to print money! Think about it. It does not matter if it is a $1 bill or a $100 bill, it cost them about the same to make it (a few cents each). Then they "LOAN" that money at full face value to the US government. Full face value PLUS INTEREST!
So if you are thinking that Bush's plan to grow the economy by handing out $100 bills won't cost anything - Think Again! Where is that money going to come from? That's right - the good ol boys at the FED. These mystical folks seem to be able to pull money out of thin air! Just think, with today's high-tech world, the FED can just punch a button on a computer somewhere and release new funds to the world. Most of which never represents new bills being printed, but just credit in some bank or financial institutions account. Electronic numbers moving through nanoseconds of time and space.
Not only does the FED create money, they also have the ability to set their own interest rate! The Fed's Open Market Committee (FOMC), announces their interest rate decisions. This is NOT the interest rate that you and I can get money for, (why don't we all meet at the Fed Discount Window - wherever that is) but what the BIG boys who keep the whole world flowing receive. They in turn pump up the volume and pass the savings on to you and me right - WRONG! It could take weeks or even MONTHS after a cut to see any savings at the consumer level, if we ever see any at all. So why do the markets get so active after an FOMC announcement?
Well again, the BIG boys are the ones who really move the market right. We just want a small slice of it. That's all. Remember that when you are trading (or practicing the trade) an FOMC announcement. Don't get greedy. Get a quick profit, and either follow it with a stop, or just get out and smile! Remember that it could GAP past your stop too.
My guess is that this HUGE economic mess is no where near finished. Who knows, it might even lead into the Great Tribulation mentioned in the bible. No matter what happens, we can all do well with Simple Index Trading. I look for GREAT times ahead for our team. We might have to pay more for the things we get, but at least we can stay home and earn the money to get them!
If you have never traded LIVE on a FED announcement, you really need to practice it.
See a video on trading a Fed Play here:
How To Trade A Fed Play
For a great video on taking advantage of down trending economy moves visit:
Come back to our blog here to read other tips on Index Trading Moves.
Have fun with it, and I hope to trade with you soon!