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I'm taking a leave of absence until after the Chinese New Year in 2010.
I estimate that I'll be back March 1, 2010 or sooner.
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posted by Raymond T. Lee (See Disclaimer at bottom) at 6:03 PM
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Cont'd discussion about Jim Cramer's Real Money: Sane Investing in an Insane World
FED RAISES INTEREST RATES OVER 5%.
GDP growth 2% and falling.
Big Money expected to Sell metals and minerals.
Big Money expected to Sell BRIC smokestakes (machinery and equipment). E.g. CAT.
Big Money expected to Buy high-multiple tech stocks. E.g. GOOG.
GDP growth 1.5% and falling.
Big Money expected to Buy banks and financials
...cont'd tomorrow...
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posted by Raymond T. Lee (See Disclaimer at bottom) at 6:09 PM
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Cont'd discussion about Jim Cramer's Real Money: Sane Investing in an Insane World
FIRST FED TIGHTENING
GDP Growth 3% and rising.
Big Money expected to Buy smokestacks (machinery and equipment).
SECOND FED TIGHTENING
GDP Growth 3.5% and rising.
Big Money expected to Sell financials, housing, retailers, and auto.
GDP Growth 4% and rising.
Big Money expected to Buy metals and minerals.
GDP 5% and FALLING
Big Money expected to Sell paper and chemicals.
THIRD FED TIGHTENING
GDP growth 3.5% and falling
Big Money expected to Buy medicine and supermarkets.
Big Money expected to Sell techs.
FOURTH FED TIGHTENING
GDP growth 2.5% and falling.
Big Money expected to Sell non-BRIC (Brazil, Russia, India, China) smokestakes (machinery and equipment). E.g. MMM.
...cont'd tomorrow...
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posted by Raymond T. Lee (See Disclaimer at bottom) at 5:37 PM
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Cont'd discussion about Jim Cramer's Real Money: Sane Investing in an Insane World
FIRST FED EASING after series of Tightenings.
GDP Growth 1% and falling.
Big Money expected to Buy retailers.
GDP Growth 0.5% and falling.
Big Money expected to Buy housing.
GDP Growth 0% and falling.
Big Money expected to Buy auto.
SECOND FED EASING.
GDP Growth -0.5% and falling.
THIRD FED EASING.
GDP Growth -1% and falling.
FOURTH FED EASING.
GDP Growth -1% or less.
Big Money expected to Buy low-multiple tech.
GDP Growth 1% and rising
Big Money expected to Buy paper and chemicals.
GDP Growth 2% and rising.
Big Money expected to Sell medicine and supermarkets.
...cont'd tomorrow...
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posted by Raymond T. Lee (See Disclaimer at bottom) at 4:51 PM
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Outrageous TV-stock market guru Jim Cramer describes the stock market fashion cycle in Jim Cramer's Real Money: Sane Investing in an Insane World
This week I’ll be writing about that stock market fashion cycle, sometimes called Sector Rotation.
You can recognize what stage of the cycle we are in by the Fed easing/tightening activity and secondarily by the annual growth rate of the Gross Domestic Product.
...cont'd tomorrow...
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posted by Raymond T. Lee (See Disclaimer at bottom) at 10:14 PM
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Cont'd discussion about Guerilla Investing: Winning Strategies for Beating the Wall Street Professionals
Start buying immediately upon seeing the following pattern:
1. A stock trades in a small price range for about six months or more.
2. During the preceding time, when price goes up, so does price and when volume goes down so does price.
3. Then, suddenly, huge volume is traded on the upside as price breaks out of its range.
4. Volume drops as the stock continues going up but on up moves, volume is greater than on down moves.
...back next week...
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posted by Raymond T. Lee (See Disclaimer at bottom) at 9:54 PM
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Cont'd discussion about Guerilla Investing: Winning Strategies for Beating the Wall Street Professionals
Here are some areas where the amateur investor has an advantage over the professional investors.
1. Small cap stocks and stocks ignored by analysts
2. Buy and hold.
3. Change market directions before the professionals are able to change theirs.
4. Wait until the professionals all go in the same direction and then take the opposite position. Look in the Investors' Business Daily at the Sentiment Indicator. A bearish signal occurs when more than 55% of investment advisors are bullish or fewer than 20% bearish. A bullish signal occurs when fewer than 35% are bullish or more than 50% are bearish. Also, look at analyst ratings of a stock. If all of them are bullish, then you have a short selling opportunity. If all of them are bearish, then you have a buying opportunity.
5. Take advantage of the professionals' need for short term performance. On the last day of any quarter, professionals sometimes bid the price up on stocks they already own to make their performance look better. So look at public information to see what stocks professionals already own and buy along with them as they bid up the price near the end of any quarter. At the same time, look at public information to see what stocks professionals already own which have been poor performers and short sell while they start to sell those to eliminate them from their portfolio at end-of-quarter.
...cont'd tomorrow...
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posted by Raymond T. Lee (See Disclaimer at bottom) at 5:55 PM
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Cont'd discussion about Guerilla Investing: Winning Strategies for Beating the Wall Street Professionals
Guerilla Investing advises amateur investors to avoid being involved in activities where professional investors have an advantage over amateur investors. Therefore, says Gureilla Investing:
1. Avoid timing the market.
2. Avoid aggressive trading.
3. Avoid trading on earnings announcements.
4. Avoid trading big cap stocks
5. Avoid options.
6. Avoid mergers and acquisition strategies.
7. Avoid IPO's.
8. Avoid businesses that you do not understand.
9. Avoid emerging markets.
10. Avoid anything too good to be true.
...cont'd tomorrow...
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posted by Raymond T. Lee (See Disclaimer at bottom) at 6:33 PM
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Cont'd discussion about Guerilla Investing: Winning Strategies for Beating the Wall Street Professionals
Consider four key questions when assessing your own strengths and weaknesses as an investor with a view towards designing a guerilla investing strategy.
1. How much money do you have and want to use for investing? If you don't have much money, then you must take smaller positions each time you invest.
2. How much time do you have and want to use? Save time by investing only when you have an advantage and not investing when you do not have any advantage.
3. How much risk do you want to take?
4. What resources do you have that can help you in investing?
...cont'd tomorrow...
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posted by Raymond T. Lee (See Disclaimer at bottom) at 8:56 PM
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