Monday, April 19, 2010

Man o man alive...

Today was what I am dubbing an N-shaped day. We opened down, went up to green, then went back to low of day and then closed at our highs. Hence an N shaped day. Hey, why not, we have V and U and W shaped recoveries, we might as well make good use of the whole alphabet.

In the meantime, I think tomorrow is a critical day for this market. GS reports and how well that sector reacts is going to determine, or help to determine where we head on either side of 1200 S & P. Today's action was more short covering late day into GS then anything else I believe and I still think we pause here with an outside shot at a decent size correction.

Couple things I'm looking at on pullbacks are some of the biotech stocks that have FDA and other news dates supposedly upcoming. Stocks like DNDN, HGSI, POZN all have important milestones upcoming and that trade has worked extremely well for a while. I am looking to add to those on a drawdown.

I have to say that anyone who knows me knows I'm not a "fan" of GS, and I can't possibly know the facts here, but it does seem really odd to me that anyone can claim this isn't political smoke and mirrors. I mean, come on, either these practices were right or wrong 10 years ago, or they weren't. Now, all of a sudden when a vote on financial reform is up they decide its wrong?

I think its wrong, which is why it might be surprising for me to take this stance, but I just think that things are a lot cleaner when they are done BEFORE meltdowns, then afterwards. And, how can it be glossed over for decades, but now its fraud?

The truth is that the average investor is at a HUGE disadvantage and is usually the one hurt in any meltdown. Most investors don't make money in the market, which is why when I get told that most traders don't I scuff. I will go to my grave saying that trading is far safer over the long haul then investing and at least you have control over your destiny. Imagine being a GS shareholder for the first time a week ago only to have your head handed to you. Don't get me wrong, I've had my head handed to me many times. I was just doing my Marketcast class and relayed how I was long a biotech stock last year and got DESTROYED on it due to bad news that came unexpected. My account was cracked pretty darn hard and it was not a happy day inside my brain, trust me. But, at least I feel like I can pick myself up and make decisions for myself.

Right now, what's interesting (or disturbing depending on your way of looking at things) is that as much as we are trying to crack down and regulate, we're doing almost the exact opposite. How? Well, these regulatory agencies are supposed to look at market manipulation like insider trading, or the type of trading they claim GS did, where they didn't disclose properly. Obviously there are other indiscrepencies, but those are two big ones. But, the thing is, the politics of all this is very blatantly manipulating the markets in much the same way, or even worse.

The only reason the stock market went up is due to government intervention. It feels sorta like in a very literal way that we're now "too high" and thus they want to tear it down a notch, lest the citizens revolt! And, I don't blame the average, or most, Americans for being pissed, but the anger is misplaced I think, which is why we hear these now cliche terms that its "Wall Street's fault!"

What does that even mean? There are private banks that have nothing to do with Wall Street that went under due to over zealous lending practices. Am I Wall Street cause I'm a trader of stocks?

I certainly hope not, I certainly don't want to face any angry mobs, I like to view myself as a good guy on the side of right. Not perfect, but a good guy nonetheless.

So, where is the problem? The problem is cultural is my take. It's culteral greed and the notion of being a society of victims is disturbing. I saw something late night last night about this guy who slipped and fell and everyone told him to "SUE!" I didn't catch the whole thing so I may be taking it out of context to be fair, but basically he said that he told them he didn't get hurt and that most people said "so, sue anyway, you can get a lot of money!"

Now, if the guy was hurt, he should sue if thats what his inclination is. If there is negligence then that seems appropriate, but suing for the sake of suing because you "can" sue and no other reason? That seems disturbing to me. There should be some thought process, I think, about the other side of things. Again, this is coming from a guy who had a very bad car accident last year and who would like to sue for my damages, but I think that there are limits and we push the limits of those boundaries at times. I just wanted to disclose that piece of it, lest I get called a hypocrite, which I may be called anyway come to think of it.

Regardless of me, I think that it's now time to concentrate on creating jobs and helping families in this country EAT and have a good home, and good healthcare, things that we all should have and all deserve. These political agenda's, I mean, does the average American think that they are going after GS now for any other reason, other then to force an agenda? And, I agree with the basic tenets of much of that agenda by the way, and again (I feel like I'm qualifying way too much, hehe).

I just don't agree with the tactics that seem routine now in the way our government works on both sides of things. Even the choice to go after GS was 3 to 2 vote with 3 Dems voting for it and 2 Reps against.

How in the world are we going to bring everyone together when things are so skewed that decisions are made not on the merits of cases, but on the political will of one party or the other?

And, lest I be accused of being anti Dem or anti Rep, I think you can see I really don't give a damn about either party at this point. I do care, however, that manipulation is deemed manipulation and that means that if the markets are being manipulated then ALL parties are accountable.

How about all the lobby money, all the political contributions and all the money made on the stock market leading up to the meltdown by these politicians, how about they, as a show of good faith to the American people, how about they give it all to back?

Since clearly there was a lot of looking the other way, which no one can really seriously deny, let's assume some of it (I'm being generous) was because of lobbiest and that the market was zooming to 15,000.

How about that for a start?

Just remember an old adage - "when one finger points at someone or something else, THREE point back"

Oh, and I'll even qualify that, what I really think is, again, its time to focus on POSITIVES and move things forward to really and truly help people. If I am out of work and starving, I want to eat, I can't feed my kids a law suit, they don't taste very good.

G-d bless and let's see what happens when the market shakes out tommorrow, I'm confused here.

BTW, if you don't know it yet, we are having 2 or 3 FREE classes this Thursday evening starting at 7 pm EST. If you didn't get an email about it, send me one and I'll forward it on to get you signed up;

Peace out, see ya on the other side,


Sunday, April 18, 2010

Trading as a business opportunity...

Lately for some reason (I have my theories) I've gotten a lot of "can I get rich quick" emails from clients, or former clients, or wannabe clients, or who knows.

Trading to me is a legitimate business opportunity. My response is always - I don't know how. I know how to make money over the long haul, this is a job (fun often) not a lottery ticket. For people who want to, I believe, to create for themselves, be your own boss and create your own wealth, but there are always risks and not everyone makes money obviously...some lose, like any other business.

When I was on CNBC I guess a while ago they asked me about it, saying something like - isn't it true many people lose trading - I don't recall the quote, my memory since the car accident last year isn't what it used to be. Having said that, that will suffice. And, basically my retort was that it's similar to opening a pizza parlor. Some people open up a pizza joint and do very well and become famous (in NYC we have places like John's pizza, which is my favorite; Rays, which is a tourist spot, though most tourists never find the REAL Rays in Little Italy; or Patsys/Grimaldes) and some earn a living and some break even and some go out of business. I've found over the years that that's about what happens in trading.

More later, I'm beat, I'm going to post link to the Thursday 7 pm EST FREE classes and also more on this topic. It's very frustrating to me, today I got an email that literally (well, I'm paraphrasing but its pretty dead on) said "I've lost $600,000 and have $40,000 left and I have a debt that is due in July for $150,000, can you tell me how I can triple my money?")

The only "good" thing about the email is that I had Ilene check our databases and he's not a client as far as we can tell. So, he didn't lose the $600,000 as our client. I still feel badly if that's a true story, I don't like to hear about anyone losing, but its troubling that someone would lose basically 90+% of their money and still be trying to hit home runs! Still be looking to gamble and get lucky.

Trading in my opinion is a real business opportunity, if you want to go to Las Vegas, hey, go head. I've been there and when I gamble I usually lose as do most gamblers. And, as I've discussed many times here and in classes, when I've made stupid mistakes and taken "shots" which basically means I gambled, then yes, even I lose as well.

Be smart with your trading, its a marathon, not a sprint and if anyone tells you otherwise then tell them you are looking for something stable, not for a bookie.
Unless of course, you would like to turn $600,000 into $40,000 as well.

This is a tough economy, people are desperate, the winners maintain their composure. It's hard sometimes to do that, trust me, we all struggle at times with this, but ultimately to succeed we have to bull, or bear, through it.

Stay real...


See ya manana on the other side

Michael "Waxie" Parness

The upcoming week...

Tough call here, either we just ignore Friday's action and bust to new highs, or the top of this move, which would be about 1225 I think, holds as a wall and we really do get some type of pull in. Very tough to call a top here, but I'm not in a hurry to go long either. Definately want to wait for confirmation either way. I do think move higher in GS is shortable (I own very small lot of puts on it (10)). This is the first real test of the markets mettle here, so it'll be interesting to see how it pans out. Also, AAPL reports this week (I own a few puts on that one as well), and how that reacts post earnings will also be a good indicator. There are a few biotechs I am watching for upside, tho.

Man, I tell ya, we are in no man's land. It is amazing, though, how relatively quickly things can change. Last year was the opposite where every up move was met with selling, now every down move people scream "buyyyyyyyy!" As though Friday's 125points was this huge move down. It's not obviously, particularly relative to the like 80+% move up we've had off last years lows.

Will be posting about some FREE classes this coming Thursday. We are trying to do more FREE classes for several reasons, #1 to introduce people to what we're doing, #2 people are struggling and need to check things out before jumping in.

Will post more on the classes shortly...


Michael "Waxie" Parness

Thursday, April 15, 2010

Life...or something like that

The market kept up its frantic pace and never ending skyward march perhaps back to S & P 1500 eventually. It'll be interesting to see how today pans out (Friday) since GOOG got KILLED after hours, down $30ish and the futures are tanking right now. With GE and BAC pre-market we'll either get a decent size drawdown or they'll be enough to pull us back up. My bet is we have a down day, but hey, in this market ya just never know...

I like a few stocks higher here, though and will detail to clients over the weekend as we prepare for a bigger barrage of earnings next week. So far its mostly higher off earnings but GOOG could be setting the stage for a leg down in techville. BAC and GE will really lead the banks, and thus the S & P. Watch 1200 on S & P as pivot Friday and throughout Options Expiration day. Make sure to close out of your April positions unless you want to roll them over into stock, or May.

FYI, I will be sending an alert out to all those who have expressed interest in our 3-DAY OPTIONS INTENSIVE that I spoke about here recently. If you are interested please email me ASAP as I am planning it out. It's not cheap, but it will be worth it, of that I am sure...;

Today was one of those days where I had some clarity, or what seemed like clarity into the meaning of life. Or at least my life.

A project I'm involved in seemed like a really good match for an old friends business. I hadn't talked to Neil in probably 7 years or something, since he called me and said he saw me on TV late night, one of the infomercial showings years ago. Neil is someone who I used to do business with when I sold baseball cards. He is honest, caring and an all around good guy. He's the kind of person that you really want in your life because you know he's not looking for anything but good for you. Yeah, he's a businessman and runs a very successful wholesale business, but even when we did business and haggled over prices on stuff, we always seemed to manage to come to a mutually benificial deal. He left his ego at the door and didn't forget that we liked each other. We had a banter that wasn't typical of almost any other business relationship that I've ever had. We did business for roughly 3 years and during that time he always expressed interest in my life outside business. He was "worried" about me, that I wasn't married, and seemed to wander, my ADHD apparent. He invited me to his house one day and wanted me to meet his wife, his kids, and basically every relative he had, or close to it it seemed. Neil is a religous man and it was for the Sabbath that we gathered. It was odd to me, since I'd never done something like that with a business relationship. Never. Odd, but also wonderfully comfortable. His entire family made me feel at home. Now anyone who knows me knows I'm not very religious. I grew up kinda lost and, well, wandering, trying to find my way. My family didn't really know what they wanted, so neither did I. So, having a religous meal of any kind, regardless of religion, was a very foreign thing to me. Very.
We had a great meal, and Neil made sure to make me feel as though I was part of his family. In fact, he introduced me as a "brother". I'm not terribly sensitive that way, I tend to fend off intimacy at times, or at least used to. I think I've grown since that time, but certainly then I wasn't the type of man who would easily be vulnerable. Not in the least. Yet, it was the first time in a while that something like that felt good. Growing up outside the system, certainly not the product of the typical "nuclear" family, the notion of family never really had a context. It usually meant that alien beings had descended on my life and were taking me to another galaxy. Yeah, I'm exaggerating, but not by much, it really was foreign to me.

OK, so after I became "waxie" and somehow found myself trying to help people find themselves as traders, or whatever it may be Neil and I lost touch, until that day when he saw my show.

He told me he was proud of me, that he always knew that I would accomplish great things and that I need to honor who I was. Proud of me? Someone who I hadn't spoken to at that point for maybe a couple of years or so? Yeah, proud of me.

Now, I should note that Neil isn't that much older then me. I'm not 100% sure, but I think he is about 53 years old. That seems about right. See, the thing is, Neil really did view me as his brother. I have a brother I'm very very close with, but I accepted Neil's invitation. He used to talk about spiritual brothers and I have other people in my life I feel same with, so its easy for me to accept that as fact.

After that call we spoke and emailed a couple of times over the years, and I thought of him at times and thought of calling him several times, but as life or choices of life would have it, it just never happened.

So, today I called Neil to talk business, but also to catch up. The people I called on behalf of, besides myself asked me if I was sure if Neil would take my call and get right back to me. Yes, I was sure.

When I called his secretary picked up and asked me who I was and what I wanted. I said just tell him it's Michael Parness and that's all. She said hold on and about 60 seconds later a male voice answered the phone. I of course assumed it was Neil, though the voice wasn't his. Voice is one of those things that if you are connected to someone you just know them in a nanosecond.

No, it's not Neil. It's his son, his son Noah. I remember you, Michael. You are unfortunately a week late. My heart sank as I asked him "Neil passed away?"

His son replied that he hadn't passed away, he had a horrible stroke and is basically unable to move, speak or do much of anything. There is apparently little hope of recovery.

I was very upset and spent five minutes relaying my warmest wishes and asking if there is anything I can do. That's one of those questions that really has no answer to it, we say those things and mean them, but what could I possibly do, other then offer prayer and my best wishes.

Noah told me that he wanted me to know that his father often spoke of me, that I was one of his favorite people and that I meant a lot to him. Our relationship meant a lot to him despite us not speaking for years at a clip. He went on for several minutes, even after telling me that he had someone there and needed to call me back.

It's amazing how much impact we can have on others around us, often without even knowing it. I spent a lot of my time calling stocks, dealing with customers who are happy, sad, mad, whatever. I get emails sometimes from clients telling me I had an impact on their life. Today one of our best students, who's probably made more then me trading lately told me that she build her house at least partly with our help. I'm proud of that piece of "this". I'm proud that I can and have helped some. Not everyone, but some.

Yesterday my daughter and I were talking about this book that she had read, "Three Cups of Tea". I haven't read it, but it sounds like a wonderful story. The guy it's about apparently has built many schools in isolated places in Pakistan and Afganistan where women and the poor don't get what we often take for granted here, an education. None. My daughter heard me speaking to Michael H. who works for me at about my Haiti Project. Some of you know about it, and some of you have been generous enough to contribute. I think you for that. I'm working to build the best dang school Haiti has ever known. At least I hope to. And, to that end I've helped raise a nice chuck of money. We need more, but its a great start. So, my daughter said to me "daddy, you're like Greg Mortormer, the man from Three Cups of Tea".

I said, "oh, well, I just want to do things that you and your sister will be proud of me for." She replied that her and her sister were already proud of me, that I'm a great daddy and that's better then anything.

It made me tear up. There's nothing better then that, is there? Because if there is, I haven't found it yet. Having the love and admiration of people who you care deeply about. When Noah told me his father spoke of me often and was proud of me, it felt the same.

I hope I can live up to the belief's that others have in me. I don't know what success in life is sometimes. We define it for ourselves, but really I think it's how others define it for us that counts in the end.

Thing is, much of what Neil spoke to me about and wanted for me I either have, or am close to having, or at least know I want now. I thank him for that, I am grateful.

Have a good night all, market will open, market will close, they'll go up, and down.
Our lives have meaning if we allow them to have meaning, if we are open to there being more to life then whats on our mind in this moment. Sometimes I forget that, until I am reminded with days like today. We impact others more then we know, its something, I think, to be respected and nurtured.

I wish Neil and his family my heartfelt prayers. I'm proud of him, too.

No ruling tonight, just this.

Michael "Waxie" Parness