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10.3.2018 - Free Investment Newsletter Bookmark

YOU DID IT!
 
I have to thank all of you from the bottom of my heart. If you don’t know, I am involved with the Alzheimer’s initiatives, and this Saturday is our “walk” to defeat Alzheimers.
 
We asked for donations to our “team” and we put an ambitious goal of 3,000 dollars as our teams fund raising target. Well, you generous folks did it, we surpassed our goal!

 
I know it’s not easy donating for all the causes that are out there, and many of you stepped up and tossed us a generous gift. I truly do thank you. Of course there’s always the feeling that the money won’t get to where it really helps, but we’re pretty confident in this outfit, and as I said, if any of the money that was donated gets to help just one person with this horrible disease, I’ll be happy.
 
So now I’m feeling pretty generous myself. Maybe there’s a way I can say thank you to you folks.
 
As you know, we run something we call the “Insiders” club. It’s a daily “blog” that I produce 3 times a day, where we talk about the markets and what individual stocks I might want to buy ( or short). We might trade options, we might buy some ETF’s, etc.
 
There’s generally 3 updates a day, one ahead of the open, one an hour and change after the open and one after lunch. While I’m not a broker or an investment advisor, and I can’t tell anyone to buy anything, I can show you all what we’re doing. You’re free to follow along.
 
For instance, this is the update we sent at 10:40 am on the 2nd.

10:40

Well, they got us back to "flat" after some opening red. The DOW has been the one with the most ambition, having been as high as +36, But the S&P is red by 4. The NASDAQ which was red by 20-something, battled its way back to almost green. 

So, now what? Maybe after yesterdays big gains, they just need a pause day. 

NOTE>>> as I'm typing this, the DOW spurted higher, now up 49.  

I'm still willing to take PFE over 44.55 and I could convince myself to try AAPL over 229.50

NOTE Again>>  I don't know what the news is, but something sparked a big move. The DOW is now up 90. 

I'll find it, but it hasn't crossed any major wires yet. 

I'll get back with you after lunch and see what they did. 
 
Sure enough AAPL did cross 229.50 later in the session and we took it. At first it didn’t look like we were very smart, as it moved to 230.00 and then fell apart and went red by 30 cents on us.
 
But today it battled back and hit an intra day high at 233.47. That’s 3 bucks a share in a day and a half, and hey, that’s good stuff.
 
We don’t win them all, and we don’t hide it when we’ve made mistakes. For instance TJX looked like it was building a base to break out from. We entered it and for four days it sat there wobbling. At one point it was up about a dollar a share, but then it fell apart. We sold it for a loss of a few cents.

We liked the pot stocks last year and entered several of them. Then early in this year, people were asking us what to do with some of them as the gains were really big. Some of them were up over 300%. So we suggested selling half the position, as that’s what we were doing. We still have some of them.
 
Anyway, enough “selling” for now. Here’s what I’m thinking. Anyone that decides to sign up for a year of our Insiders Club between now and the end of the walk on Saturday afternoon, will get 2 full years, for the price of one. A true 50% off sale.
 
We’ve been doing these letters for going on 24 years, and our members will tell you that we don’t do many sales like this. So you should probably jump on this if you’ve ever had any interest in being a member.
 
Simply go to www.investyourself.com and hit the big red button at the top of the page. The first page is your “registration” for an account, and the second page is for credit card info.

(NOTE> when you hit the red button that says “click to subscribe today” please understand that it can take up to 30 seconds to load that page. It might sit there “white” for a while. That’s because we do NOT keep any credit card info on our servers, we host the registration and CC inputs at authorize.net, the giant CC processor company.That way we can never be responsible for someone getting your card info from us. So it does take a bit of time to connect over to their secure sockets)
 
Again, thanks for you donations to the Alzheimer’s initiative, and please take advantage of the two for one special.
 
The Market:
 
Nuts! It’s nuts! We’re busting new high after new high, and yes the trend has been up for months now. One might ask the question “Why is this market roaring like this?”
 
I guess I’ve beaten that horse enough. The market is up for a very small concentration of reasons. 1) Central banks pushed untold trillions into the economic system all around the world. 2) once the momentum got rolling, no one wanted it to stop. 3) Companies have bought back RECORD amounts of their own stock. 4) Central banks are actually buying individual stocks. ( The Swiss National Bank holds tens of billions of them and continues to buy)
 
Today the DOW closed at a record high for the 15th time just this year alone. At some point, one wonders where the prices of equities are so far removed from reality that this stops? But the question really is, does it have to? Nope. If the biggest players are still pumping money into it, it will not stop going up. If companies continue to buy up millions of their own shares, WHILE Central banks are buying the stock, they’ll keep going up.
 
One could say I’m an old fashioned dinosaur and they’d be right. But unlike many I’ve lived through 2 major crashes, the “dot com” bubble and the housing/credit bubble of 2008. This time they’re blowing a bubble bigger than both of them.
 
One of the cool things about being a cranky old guy is that I can call it like I see it. What I see is a system they’ve developed that needs debt to sustain itself. And they’re perfectly willing to create that debt. This isn’t a novel idea, it’s been kicked around for several hundred years. But the reason no one’s done it before to this extent is that it has always created an inflationary nightmare.
 
This run could continue right on through until spring, or it could roll over and crash tomorrow. Yes the trend is up, it was up in 1999 and in 2007 too. But to think that somehow this just keeps going and going, is a bit beyond me. While I think that Central banks can keep this going for longer than anyone expects, I really don’t think the rest of the world is going to continue playing along.
 
For instance consider the EU and Iran. The EU has been working on alternative payment systems so that they can bypass the US sanctions on Iran. China’s already partnered up with Russia to do some trade in Rubles and yuan. Again, at some point there’s going to be “quite the reset” and it’s possible that one of the reasons for this run up is like the last hurrah. Get all they can get with dollar denominations, before global hell breaks loose.
 
In the meantime, we’re going to continue leaning long on trades. Maybe one day the play will be shorting and buying puts, but so far that’s been a suicide idea. We’ve been keeping position size lower, and taking “half positions” of the table when they’re up some. While we try for 3 - 5% on every trade, I’m not shy about taking 2 bucks on a trade if it looks like that’s all it’s going to get.

Right now I’m in HOS and AAPL. We’ve got a few other interesting ideas to look at too. One thing to always keep in the back of your head is this: In 2010/2011 we developed a stock/option trade that took 30K and turned it into 1.2 million dollars in a year. In 2016 we developed one that took 19k and turned it into 245K in 7 months. But...

The best basic trading year we ever had was being short and holding puts during the 2008/09 crash. At some point, and no I don’t know the date, this market will come down. And we’ll want to be wholesale short when it does. Have a great night and again, thank you for your Alzheimers donations. I’ll proudly do the walk on Saturday with my team members.

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