I must add yet another paen to Phil's "cash and short" call, as my TZA shorts are past paying for Similac and Pampers and have now covered all doctors and Mt. Sinai hospital bills for young Charlotte, as TZA took the portfolio up 10%.
Zeroxzero
Best year I've ever had…sitting on a 52% YTD return. I would also echo Nat's shout out for Phil's talent. I've been a member for the 6 years or so. Just stay true to the strategy I've learned over the years of selling premium, keeping the bulk of my portfolio in long-term buy writes ("armchair" trades).
JJennings
Hi Mr. Phill, I am a Venezuelan lady tormented by our politicall situation, who use to be an emerging market trader, and many other executive positins in the finance "arena" and now is trying to built a new concept and service for asset management for clients on my own, I am in the trial and learning process at the moment, I also invest for some friends and myself. I want to congratulate you , because reading you fill my days with a touch of irony (besides ,of course the spectacular market insight) that happens to give me energy, its a joy the remarks and comments even the pictures used, sometimes I just read it for the fun, I completily agree with your thouhts, though we belong to totally different cultures and enviorements and certanly realities Your readings is like a little hand helping me out to be in the market and fight for my devastated country where every single day we looe inches and yards of liberty. You shoul try to writte a book!
Mindeyes
Don't expect to get rich quick here, but you can get easy 30 - 50 % per year, just by buying good stocks at discount (as we often discuss), selling monthly premiums of calls and puts.
Tchayipov
Phil - I know I am small change compared to most others members, but I just wanted to let you know that during the last two weeks with the shorts you and others suggested I have 6 winners and 5 losers. My losers were small because I tried to follow your guidelines as best I could. On the other hand my winners on average were around 50%. Consequently, I am up $2000 in 14 days. Thank you for your patience and help. I think I am making progress getting rid of some of my poor trading habits of the past!
DCalrk41
Thank God for Phil.
A few months ago (April) I didn´t even know what hedging was, and someone recommended I should check out some of Phil´s plays, especially on the retirement portfolio. When I first started to read it, none of it made a blind bit of sense to me, but I stuck with it and gradually began to work through some of the trades to see how it worked. Now I am putting on 5:1 SPY backspreads combined with bear put spreads, entering and leaving positions after consulting the VIX, and engaging in other esoteric maneuvers that are keeping my portfolio above water.
jmm1951
Phil – BTW, the new STP/LTP coupled with the income portfolio is Perfect! I do not trade all of them, very few actually since I work during market hours. However, following the trades real-time is very educational.
I did enter the ABX call if you recall, I rolled to July on that nonsense news that sent it tumbling. Out today for 110% gain (2.00 stop) not counting covering the loss from the earlier roll. Nonetheless, a good trade.
Keep it up…. Thanks
JFawcett
Speaking of the "Man Who Planted Trees", it really works. I bought BTU back in March at $49.87. I practically bought it at the tippy top. However, I soon afterward found this site, started learning Phil's methodology(and those in the strategy section) and began selling calls/puts regularly against my bad position. As of yesterday, I still own the original 100 shares, but have brought my basis down by over $11.00. Couldn't be happier, what started out as a really bad entry, I have managed to work down to a good basis. Had I not watched that video and learned your system, I would sold out of the position, and been kicking myself for making such a bad entry.
Hoss
Phil / TNA – On Monday you put out the TNA BCS 41/47. As I mentioned I work during market hours so on Tuesday morning on my way out the door (premarket) I put in an advanced TOS '1st trigger sequence' order to fill the BCS. I can control the entry using this method vs. the vertical entry that TOS allows for the BCS. I filled the June 41 long call but never filled the 47 short call. I let that ride into today. OMG ..TNA popped 7.5%!… the $3.60 entry is almost a double! Tomorrow will be a OCO bracket to get out of TNA before Ben speaks. I should be able to preserve 85% – 100% on the trade. For the income portfolio plays in my IRA's, doing very well… I do like collecting premium! Well done and thanks!
JFawcett
Phil – great calls this past week, esp. friday and monday. in the old days I would have let Prechter et al scare me into trimming my longs and going short at just the wrong time. your feel for the markets is Tiger-esque. CHK, HOV, BX, TLT and XLF are big winners for me today. My biggest up day in a long time. Thanks!
Terrapin22
Took profit on QQQ 57 Puts, bot 40 at $0.07, sold 20 for $0.15 and 20 for $0.32. Thank, Phil
Bobhu
Peace of mind / I have a portfolio mainly consisting of long term long calls, short term short calls and puts, and long term BCS. Three years, ago when I started my journey on this board I would be freaking out panicking as to what to do, as many of the short calls are ITM, Three years later (today) I look at the screen and serenely process the information. Three years ago, I inevitably made the wrong decisions which cost me a lot of money. Three years on I calmly roll the positions to whatever makes sense. No drama, no hair pulling, and a great cost saver. I guess they call that the power of education.
Winston
Happy Thanksgiving Phil and to your family and associates. Also to all of the other fellow citizens of Phil's Stock World. I am particularly happy and thankful that I clicked on your article in Seeking Alpha a number of years ago. That opened the gate to Phil's Stock World and "being the house". My wallet thanks you as does my peace of mind in trading options, stocks and rarely futures. Your liberal views opened up my views—being a boot strapper (pulled myself out of a poor background) I was a CONSERVATIVE—cynical of others who weren't as driven. Now, I am much less so; you have taught me more than how to make money and manage risk. So, again I give thanks to you and the others of PSW!!
Newthugger
GIVE THANKS/PHIL
Have not done my 10,000 hours, but a couple of years at PSW, and moved from fishing with a single line to owner of a commercial trawler (metaphorically speaking). Now I fish with many lines. It is amazing when you go over the same information time and time again, eventually it clicks. Like planting trees; being the house, 20% sale items, selling into the excitement. and patience. I just sold an AAPL Jan 12 340/390 BCS financed by the sales of Jan 12 275 Put. The trade was put on one year ago for a net credit and exited five minutes ago for a 49 dollar per contract profit. No point in waiting till opex to see what happens, and I will just sell 10 of those VLO puts to make myself net the round 50.
I no longer worry about opex coming as I have adjusted well in time for most positions that go against me. I still make some howlers (RIMM, TBT, TRGT) but I play the percentages and my winners outdistance my losers by many miles.
I would never be in this position if it were not for Phil. He is a treasure, pure and simple. The goose that lays the golden egg if we care to listen and practice. Phil, a mighty big thank you.
Winston
Hi Phil,
Thanks for the free disaster hedge ideas. I implemented variations of two of them on SDS bull call spreads and EEM bear put spreads (haven't done the TZA yet) and they really hedged my short term longs nicely today. Makes it seem a lot less like gambling.
You are the man (of the people)!
Howard Roake
I remember that call (to sell gold at $1,850) as well... and the many Buy-Writes that were created on your site during that period... thanks to you, I had an average ROI of close to 70% for over 2 years, averaging 4,000 trades per year. Busy trading, but lots of fun and memorable trades.
1234gel
Phil – just wanted to say a sincere thank you for teaching me how to offset, hedge, roll, and not panic. My account is up 10% in the last two weeks, and far from panic, this is becoming great fun. Thanks again,
Deano
I have to say, hands down, this is one of the best educational experiences I've had in my life. I've even gotten my wife (accountant) into the webinars and she wants to master this concept of selling premium and making smart, conservative investment decisions. She'll eventually use this knowledge to manage her clients' wealth and make smart investment choices for them. Bib big thanks Phil!!
AmalfiCoast
Thank you Nantucket. It is hard to be a complete beginner in the market with this complicated, fast moving, and very advanced group. Phil is the Great One, but the membership is absolutely amazing! Had I known this ahead I would probably log in as "awe struck" everyday.
Coke
Phil: UNH, hedged stock position, doing great, up over 50 %,
RMM
Best day ever trading the futures, thanks to Phil's excellent call this am, and his "play the laggard" instruction. Well done Phil!
Deano
Thanks, I managed to make 2k today so I am happy…and feel like I am finally getting it. New equipment and a quiet place to work helps a lot. I am happy for all the members that took your /NKD advice….that was fun I am sure! coke Take your vitamins…I don't know how you do all this! but, keep it up!
Coke
As a fellow "low-end" investor I like Phil's Buy/Write strategy on solid stocks. Before I came here I loved to try to "figure things out" with very little success "TRYING TO FIGURE THINGS OUT"! I traded too much and fell in love with stocks that "should have done" what they didn't do. Now a majority of my accounts are in Buy/Writes suggested here or cash (waiting for a better time for more Buy/Writes). I use 15-20% of my total holding to short term trade and hedge. This is manageable with my full time job as a business owner. I have found Phil's system a more discipline way to achieve the returns I want without relying on my ability (more like inability to "figure things out").
DCalrk41
I can't believe it. After 2 Months of reading every post of every section on this site, the light bulb finaly went on. I was begining to think this was beyond me capacity to understand. Thanks Guys. Specifically Phil, Pharm, Cap, Matt. Im still Green as a leprechaun but I pulled the trigger on that SRS Vertical you laid down yesterday Phil. Very Clever. Now if I can just figure how to roll I migh make some money. Thanks for sharing, This community you have here is quite remarkable.
Zucko
Phil - I am 3 month follower and shout a big thanks for all the good advice and training. I read all the materials and posts as suggested. I am retired CFO and took over my investments 2 years ago from broker after frustration with returns. I followed some conservative advice for retirees and have 60% bonds currently in a 5m portfolio. I had been doing covered calls on my stocks to boost returns and slowly am getting more aggressive after following your site and my son who has been with you for 6 months. I allocated 1.5m to stocks and am scaling up from 30%. I did some of the trades suggested in early June using Aug & Oct buy/writes on CSCO, WMT, MON, WFR, DO in addition to calls on XOM, CVX, PEP, PG, WM, T that I owned. Most are doing very well (4-24%) in 60 days. My good problem is that instead of getting longer, I will be making 6% quickly (50% plus annualized) and getting called away on many positions. What would you advise for getting long again. Thanks again for such a great job advising all of us!
TXChili
Opt, I think the hardest thing is being disciplined enough to trade with you. Atleast now when I see something go in the red I know how much I'm going to loose and that I will profit somewhere else and have enough money left at the end of the day to trade again. Thanks for all your hard work! My stress levels are down 75% and I have even made a small profit in the short time I've been here
Mopar
Phil – Not that you dont usually, but you have DEFINITELY earned your money this week. THe recommendations have been PERFECT. Selling into the initial excitement (MULTIPLE TIMES), hedges, everything. Im reading this when I get home from work and want to cry b/c I cant trade at work! I might have to start getting up at 3 AM though to catch those trades bc youre killing it then too! May you and yours have a blessed weekend!
Jromeha
It is amazing how much confidence you engender, Phil………..I knew the 1% a day trades and repeated often were possible as I had done in stretches, and I knew kill zone trades were also possible and 5% to 10% returns per month were very possible with practice, experience and smart risk management all without having to take a lot of risk, but I guess I was talking to the disbelievers and since I have dropped them into my 'why bother to try to explain it' file and come over to the dark side at PSW I feel soooo much more content not only with the returns, but with the company and a comments and the obvious opportunity to learn and learn and learn some more.
It all helps the mental and emotional discipline of the trading too. So thanks again.
Roro
Phil - I'm with you just little bit longer than a month and you can not imagine how happy I am now, and not just because my P/L improved ( and I'm sure that it will be even better), but I found that the worst thing in trader's carrier is a LONELINESS. Here I found so many bright good guys, I looked for this service for years.
THANK YOU AND TAKE GOOD CARE OF YOURSELF BECAUSE I PLAN TO STAY HERE AND RIDE THIS CREASY MARKET WITH YOU FOR ANOTHER 20-30 YEARS
Tchayipov
Well that was a fun day. Cashed out my GS 140 calls for about 35% profit and my AAPL calls for 38% gain. Not bad for 40 minutes of work. Back to 85% cash.
The U.S. unemployment rate climbed from a half-century low of 3.5% to 4.4% in March – and is expected to go a lot higher.
But could the rate, as some predict, surpass the 25% joblessness the U.S. experienced at the peak of the Great Depression?
As a macroeconomist who has tracked the labor force for decades, I’ve been wondering about this myself.
There are actually two figures the Bureau of Labor Statistics uses to estimate employment levels in the U.S.
One is the unemployment rate, which comes from the Current Population Survey. The U.S. Census Bureau contacts about 60,000 randomly selected households every month to get an estimate of this rate.
The other is an estimate of how many nonfarm jobs were lost or created in the month. The Bureau of Labor Statistics creates these figures by asking more than 140,000 private businesses, nonprofits and various state and local governments how many people were on their payroll at any time during the week containing the 12th of the month.
The latest data show the economy lost 701,000 jobs in March.
The employment surveys – single-week snapshots – were both taken in mid-March, around the time the U.S. first began to experience a sharp uptick in cases, and some states, such as New York and California, ordered businesses to close. Both surveys likely only reflect the very early effects of the pandemic.
In addition, they consider someone employed even if they worked only part of that week. Starting off the week employed and ending the week laid…
However, a study just published in a French medical journal provides new evidence that hydroxychloroquine does not appear to help the immune system clear the coronavirus from the body. The study comes on the heels of two others – one in France and one in China – that reported some benefits in the combination of hydroxychloroquine and azithromycin for COVID-19 patients who didn’t have severe symptoms of the virus.
I am a medicinal chemist who has specialized in discovery and development of antiviral drugs for the past 30 years, and I have been actively working on coronaviruses for the past seven. I am among a number of researchers who are concerned that this drug has been given too much of a high priority before there is enough evidence to show it is indeed effective.
There are already other clinical studies that showed it is not effective against COVID-19as wellasseveral otherviruses. And, more importantly, it can have dangerous side effects, as well as giving people false hope. The latter has led to widespread shortages of hydroxychloroquine for patients who need it to treat malaria, lupus and rheumatoid arthritis, the indications for which it was originally approved.
The idea that the combination of hydroxychloroquine with an antibiotic drug, azithromycin, was effective against COVID-19 gained more attention after a study published on March 17. This study described a trial of 80 patients carried out by Philippe Gautret in Marseille, France. Although some of their results appeared to be encouraging, it should also be noted that most of their patients only had mild symptoms. Furthermore, 85% of the patients didn’t even have a fever…
David Brin is a scientist, transparency/internet security expert, public speaker, consultant, social media influencer and best-selling author. You can find his books on his website, and his latest articles on his blog.
First off, I want to discuss a couple of generalities. Let’s start with a fellow by name of Hyman Minsky, whose insights into the nature of stability in human systems have been getting a lot of attention. Basically, during times of great stability, many people – taking continuity for granted – pile up ever greater amounts of risk without hedging against a reversal… till reversal happens — a "Minsky Moment" when instability suddenly returns, at which point things shake out amid lots of pain. Perhaps everyone adjusts together, weaning themselves of bad habits and making things work better, with more wisdom. Alternately, things may go as Karl Marx, described, viewing such shakeouts as inevitably both culling the capitalist class and impoverishing workers, leading to revolution.
Take the example of Japan, which had fine-tuned their economy according to the teachings of American quality and efficiency guru W. Edwards Demming. Taking Demming to an extreme, Toyota led at innovating ultra slim, just-in-time supply chains that squeeze every possible drop of margin from goods and services. Like an athlete who tunes her body to perfectly perform a particular movement, companies following Demming principles aimed for zero on-site storage or stockpiling – equivalent to the athlete’s nonexistent fat reserves. And just like such an athlete, stuck on a life-raft for a week without supplies, Japanese companies learned the “Minsky folly” of their mistake, when an exogenous shock – the Fukushima disaster – shattered supply chains and Japan virtually shut down.
As futurist Jamais Cascio put it: "The villainization of over-capacity has been a hallmark of the current post-industrial capitalism environment. What we have seen over the past couple of months is the value of slack in a world that’s gone unstable." (Personal correspondence.) Certainly the short-sighted selling off of federal U.S. medical stockpiles, not long ago, is a rabid chicken now coming home to roost. One might wonder if this correlates with the rise of MBAs and decline of engineers in corporate boardrooms.
Phil's Weekly Trading Webinars provide a great opportunity to learn what we do at PSW. Subscribe to our YouTube channel and view past webinars here. For LIVE access to PSW's Weekly Webinars – demonstrating trading strategies in real time – click here to join us at PSW!
I could be wrong, but let me point out three things that I think about when I hear Great Depression analogies being made to the current crisis.
The first thing I think about is that the financial markets of the 1930’s were prehistoric. Yes, the Federal Reserve was in existence, but it was nowhere near as powerful and it hadn’t had any institutional memory (or history) to draw on. Its basic structure was patterned on the still-nascent central banks of various European countries thanks to the listening tour Senator Nelson Aldrich and others had made across the Continent. Fun fact: the US Senators’ delegation took one of their most critical meetings with German monetary authorities at the Adlon Hotel in Berlin, where Michael Jackson would infamously hang his baby off the balcony for paparazzi almost 100 years later.
Anyway, this time we have an experienced Fed and the Fed knows how powerful it can be. There was a rippling global financial crisis in the midst of the 1990’s bull market and the Fed shut it down in approximately ten seconds. The lessons of Bernanke’s actions during ’07-’09 have taken on a practically Talmudic quality within the institution, from what I’m told. And the Fed has already jumped in with both feet – as Wells Fargo strategist Christopher Harvey put it in Barron’s this weekend, “The Fed took the kitchen sink and threw it at the market. Then it took another kitchen sink and threw it at the market.”
The second thing I would point out is that the cause of the Crash of 1929 is, to this day, still unknown. Yeah, you can chalk it up to valuations and excesses, but that’s a copout. The reality is that there is nothing special that had happened in the days and weeks leading up to the Great Crash, it just sort of got rolling and then kept going – feeding on itself as sentiment turned and the desire to sell infected everyone. But there was no spark. I wrote
With COVID-19 infections now evident in 176 countries, the pandemic is the most significant threat to humanity since the second world war. Then, as now, confidence in international cooperation and institutions plumbed new lows.
While the onset of the second world war took many people by surprise, the outbreak of the coronavirus in December 2019 was a crisis foretold. Infectious disease specialists have been raising the alarm about the accelerated pace of outbreaks for decades. Dengue, Ebola, SARS, H1N1, and Zika are just the tip of the iceberg. Since 1980, more than 12,000 documented outbreaks have infected and killed tens of millions of people around the world, many of them the poorest of the poor. In 2018, the World Health Organisation (WHO) detected outbreaks of six of its eight “priority diseases” for the very first time.
Even as we attend to the countless emergencies generated by COVID-19, we need to think deeply about why the international community was so unprepared for an outbreak that was so inevitable. This is hardly the first time we’ve faced global catastrophes.
The second world war reflected the catastrophic failure of leaders to learn the lessons of the 1914-1918 war. The creation of the United Nations and Bretton Woods institutions in the late 1940s and early 1950s provided some grounds for optimism, but these were overshadowed by the Cold War. Moreover, the Reagan and Thatcher revolutions of the 1980s rolled back the capacity of governments to address inequality through taxation and redistribution and governments’ ability to deliver health and essential services.
The capacity of international institutions to regulate globalisation was undermined precisely at a time when they were most needed. The 1980s, 1990s and 2000s were a period of rapidly rising cross-border movements of trade, finance and people. The accelerated flow of goods, services and skills is one of the principal reasons for the most rapid reduction of global poverty in history. Since the late 1990s,…
Phil's Weekly Trading Webinars provide a great opportunity to learn what we do at PSW. Subscribe to our YouTube channel and view past webinars here. For LIVE access to PSW's Weekly Webinars – demonstrating trading strategies in real time – click here to join us at PSW!
For LIVE access on Wednesday afternoons, join us at Phil's Stock World – click here.
Major Topics:
00:01:38 – Checking on the Markets
00:04:42 – S&P 500
00:07:32 – STP
00:12:11 – LTP
00:17:38 – SDS Hedges
00:19:01 – Petroleum Status Report
00:22:17 – Trading Techniques
00:23:18 – Disaster Hedges
00:29:07 – BA
00:30:54 – SKT | FAZ
00:33:21 – COVID-19 Update
00:46:41 – Crashiversary Week in 2011 | SKF
00:55:05 – GE
00:57:56 – HOV
00:58:54 – TOL | KBH
01:06:10 – NASDAQ
01:08:57 – LTP
01:11:27 – HA (Hawaiian Holdings)
01:14:28 – H (Hyatt)
01:15:31 – MAR (Marriott International Inc.)
01:23:07 – More Trading Techniques
01:30:54 – Bonds
01:32:12 – National Debt
01:56:49 – APRN
02:02:06 – TD
02:07:07 – VIX
02:08:31 – LB
02:11:44 – More Trading Techniques
Phil's Weekly Trading Webinars provide a great opportunity to learn what we do at PSW. Subscribe to our YouTube channel and view past webinars here. For LIVE access to PSW's Weekly Webinars – demonstrating trading strategies in real time – click here to join us at PSW!
Phil's Weekly Trading Webinars provide a great opportunity to learn what we do at PSW. Subscribe to our YouTube channel and view past webinars here. For LIVE access to PSW's Weekly Webinars – demonstrating trading strategies in real time – click here to join us at PSW!
In the 1960s, sociology professor James Henslin spent time with a group of cab drivers in St. Louis to understand their gambling habits. When the drivers finished their shifts for the night they would play craps into the wee hours of the morning, typically from 3 am to 7 am. Henslin sat in on nearly 20 of the dice games to determine how the drivers’ thoughts and actions dictated how they played.
In his paper Craps and Magic, Henslin writes about how he discovered many of the players were operating under a sense of magic over the dice:
It became evident to me that these players were convinced that they could control the dice, that is, as shown by their behavior (by their statements, gestures, and betting practices), they were not playing solely under the assumption of probability or odds, but, rather, they also moved within the framework of a system of magical beliefs.
The players would routinely throw the dice harder when they wanted a high number and throw it softer when they wanted a low number. This is also why you so often see players blow on the dice before a throw at the casino.
These practices have no bearing on the outcome but they give the gamblers an illusion of control.
When stock market volatility erupts, investors are always in search of their own illusion of control. We crave predictability and control when it comes to our money but the stock market provides neither.
When stocks are rising, investing is often boring, methodical and the opposite of newsworthy. When stocks are falling, investing is often exciting fast, and scary.
Investors often look to find some modicum of control through the answers of gurus. We just want someone to tell us what’s going to happen next so we can either buy or sell to relieve the fear and anxiety.
In all my years of doing this, I’ve never come across a single person…
COVID-19 is caused by a coronavirus called SARS-CoV-2. Coronaviruses belong to a group of viruses that infect animals, from peacocks to whales. They’re named for the bulb-tipped spikes that project from the virus’s surface and give the appearance of a corona surrounding it.
COVID-19 is caused by a coronavirus called SARS-CoV-2. Coronaviruses belong to a group of viruses that infect animals, from peacocks to whales. They’re named for the bulb-tipped spikes that project from the virus’s surface and give the appearance of a corona surrounding it.
As the pandemic unfolds across the US, city dwellers are getting the hell out of dodge and escaping to rural areas. We noted this last week, with many leaving large metro areas in California, fleeing for the mountains and rural communities to limit their probabilities of ...
By Michelle Jones. Originally published at ValueWalk.
Junior gold stocks have taken a beating alongside other stocks, but history suggests this could be the time to dive in. The Vaneck Vectors Junior Gold Miners ETF is down from where it was in February, although it’s starting to show signs that it could revive soon.
Are we headed towards a Depression or is the worst already behind us? In today’s world, comparisons to the great depression are easy to find.
Are the Depression concerns well founded or are the declines of late already pricing in a bottom?
In my humble opinion, this chart and the upcoming price action of this index will go miles and miles towards telling us if we are headed towards very tough times or if the huge declines of late are actually in a bottoming process.
This chart looks at the Thomson Reuters Equal Weighted Commodity Index on a monthly basis over the past 54 years. The index has been heading south, reflecting weakness in demand for basi...
Larry Jacobs owner and editor of TradersWorld magazine published a free special report with his top article and market forecast to his readers yesterday.
What is really exciting is that this forecast for all assets has played out exactly as expected from the stock market crash within his time window to the gold rally, and sharp sell-off. These forecasts have just gotten started the recent moves were only the first part of his price forecasts.
There is only one article in this special supplement, click on the image or link below to download and read it today!
Anyone holding bitcoin would have watched the market with alarm in recent weeks. The virtual currency, whose price other cryptocurrencies like ethereum and litecoin largely follow, plummeted from more than US$10,000 (£8,206) in mid-February to briefly below US$4,000 on March 13. Despite recovering to the mid-US$6,000s at the time of writin...
Philip R. Davis is a founder Phil's Stock World, a stock and options trading site that teaches the art of options trading to newcomers and devises advanced strategies for expert traders...
First off, I want to discuss a couple of generalities. Let’s start with a fellow by name of Hyman Minsky, whose insights into the nature of stability in human systems have been getting a lot of attention. Basically, during times of great stability, many people – taking continuity for granted – pile up ever greater amounts of risk without hedging against a reversal… till reversal happens — a "
I could be wrong, but let me point out three things that I think about when I hear Great Depression analogies being made to the current crisis.
And the Fed has already jumped in with both feet – as Wells Fargo strategist Christopher Harvey put it in Barron’s this weekend, “The Fed took the kitchen sink and threw it at the market. Then it took another kitchen sink and threw it at the market.”
In the 1960s, sociology professor James Henslin spent time with a group of cab drivers in St. Louis to understand their gambling habits. When the drivers finished their shifts for the night they would play craps into the wee hours of the morning, typically from 3 am to 7 am. Henslin sat in on nearly 20 of the dice games to determine how the drivers’ thoughts and actions dictated how they played.
When stocks are rising, investing is often boring, methodical and the opposite of newsworthy. When stocks are falling, investing is often exciting fast, and scary.
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Philip R. Davis is a founder Phil's Stock World, a stock and options trading site that teaches the art of options trading to newcomers and devises advanced strategies for expert traders...
Ilene is editor and affiliate program
coordinator for PSW.