What If This is True?
Yesterday, I was reminded of a simple yet profound lesson I learned from Napoleon Hill… that had a huge impact on the way I trade.
He once said,
“Seek counsel. Not Opinions. Opinions are usually based off a lack of knowledge. Counsel is based off wisdom and experience.”
Every single time you flip on the TV, or surf around on one of many financial sites online, you are being bombarded with a steady stream of opinions based off ignorance…. which is why a skilled trader has learned to “protect his ears”.
Trusted counsel based off experience, however, is rare and worth more than gold.
Richard Russell has written the most respected market newsletter since 1958, called the Dow Theory Letters (largely considered the Granddaddy of all Investment Newsletters). His knowledge of the history of the market is simply unmatched.
Wall Street considers him more a Fortune Teller than a Market Forecaster because his analysis is so bulls-eye dead-on accurate.
Yesterday, I was reading one of his most recent reports where he said,
“Do your friends a favor. Tell them to “batten down the hatches” because there’s a HARD RAIN coming. Tell them to get out of debt and sell anything they can sell (and don’t need) in order to get liquid. Tell them that Richard Russell says that by the end of this year they won’t recognize the country. They’ll retort, ‘How the dickens does Russell know — who told him?’ Tell them the stock market told him.”
The gist of his reasoning is that the most recent market fluctuations are giving strong indication that the market is in trouble. He later compared his opinion to the popular Barrons,
“The fact is that I’ve been seeing deterioration in the stock market ever since early April, and this is in the face of improving business news. The D-J Industrial Average is composed of 30 internationally known top-quality blue-chip stocks. These are 30 of ‘America’s biggest companies.’ If Barron’s is so bullish on the future of America’s biggest companies, then why isn’t the Dow advancing to new highs?
Clearly something is wrong. But what could it be?… If I read the stock market correctly, it’s telling me that there is a surprise ahead. And that surprise will be a reversal to the downside for the economy…”
While most people hear these words and choose to live in either total denial, or total panic… the truth is this is music to the ears of any knowledgeable spread trader.
I would add, don’t just tell your friends to ‘batten down the hatches’. Tell them how to turn this ‘perfect storm’ that Russell is predicting into a cash flow tsunami… that can set them apart financially from everyone. All they need is a proven and sound strategy in order take advantage of the windfall.
Richard Russell is a pioneer in many respects who has predicted some of the greatest runs of the last 20-30 years. This isn’t just an opinion based off ignorance. This is wisdom I trust.
Take a second and think about your own trading.
What if he’s right? Are you preparing yourself now? If so, tell me how below.
9 Responses to “What If This is True?”
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I will just ride the exculator weather its going up or going down.
Jeffrey,
I spent the last 6 months of 2009 studying what is really going on and have sources that you should evaluate in order to best protect your family.
Please send me your e mail address, and I will send you some extremely important information for your evaluation.
Jack Fraley
I bought 20 Gold Eagles the first part of this year. The last two months most of my option spreads have been Bear Calls. I own long stock position in TZA. Am I bearish? Yeah, until I get some other indication to reverse my outlook.
I have taken your course and apply what I have learned, although I usually take a slightly lower probability (more risk).
I also trade Calendars, Iron Condors and a few Butterflies.
Jeff
Hi Jeff- it is music to my ears to hear that you subscribe to the same ideology I have about our economy and where it is headed. I have been preparing for global economic chaos/collapse for a long time. I still have a lot to do, but one of my main goals is to become wealthy in the process, and be able to preserve it for my family – which is why I decided to subscribe to your service.
I believe that times like this make & break fortunes- I intend to be on the “making” side of the equation with your help. I have already pre-positioned about $35,000 of my investment account with OTM long calls in FAZ, SDS, TZA, & SRS. I know this is the kind of speculation which you capitalize on, but it was already in place before I signed up with you, so I’m betting on the long shot for a huge score by Jan ’11 option expiration. My plan is to take my seed $$$ out asap & if the market tanks I will reap millions on their dime.
Although my learning curve is steep because I do not have chart reading or TA skills I would like to be up to speed with your program asap so I can manage my investment account to great wealth. What do you recommend? I have also been taking physical possession of gold & silver trying get prepared for hard times. Where are we supposed to protect our wealth when the dollar collapses?
I live in Prescott, AZ & would love to attend any workshops or meetings which you sponsor to meet you.
Keep up the good work!!
Brian Mounsey
Heavy in cash, little bent more to the downside with inverse funds, equities on the long side that I have left are dividend payers with OTM options sold against them-considering switching to closer strikes or ITM sold call options. Problem is I feel most everyone knows the conditions in the world;however it comes to this HFT and the BS the government pulls it makes it a little hard to get overly exposed on the downside because someone somewhere is going to pump up this market regardless of conditions-apparently today is short covering before the weekend;however we are not at closing yet.
My best alternative is to short the ES, YM and commodity currencies.
I agree. It appears we have some tough times ahead and need to prepare immediately to generate a steady, reliable income streams. My immediate plans and activities involve rewatching the trading video’s learning TOS trading platform’s analyze tab and prob of expiring graphs and start paper trading the watch list next month.
Sell bear calls when a major break of support occurs or when confirming from a bounce down off resistance that was previous support – also buy puts on the index eg SPY to protect all your positions.
I have not started preparing yet. First I would like to get started by trading. Listening to your intro.to credit spreads makes so much sense, I cant wait to get started. Ive just got to get my finances in order now because of my past failures with options. I am ready to try something that is consistent an steady.Please comment on any suggestion you may have with getting started. Thanks! Maurice