“None are more hopelessly enslaved than those who falsely believe they are free”

Wednesday, February 3, 2010

INVESTING: Another game fixed for us to lose

“The fundamentals of the economy are still sound”.
Henry Paulson (74th US Treasury Secretary; Previously the Chairman and CEO of Goldman Sachs)

Ok, so we’ve established our need to invest in the financial markets (whether real estate, stocks, or the Foreign Exchange) as our best chance to get ahead and create some wealth. Now, I want you to take note of something very important.

The markets largest fluctuations are NOT a result of financial facts or the state of the economy. The largest market gains and losses occur because of the action(s) of a select few and the statements (as they’re reported on the news) of select others. This, in turn, causes people with more money than you (or at least more of a stake in the holdings being traded) to make SPECULATIONS. When enough people find cause to speculate, the market turns on its head and billions are lost. These reactions, if not based on purely deliberate acts, are always the result of a pattern of behavior (economic, political, and social) that can, with some success be predicted. In a nutshell, that’s the market.

Even Hollywood films like the recently released “Pelham 123” show you exactly how some artificial panic can create a shockwave in the market (in this case the stock market).

Now, how a person makes real money in the market is by accurately predicting what’s going to happen next, like a game of chess. Investment houses will tell you to “follow a consistent investment approach” (you here that all the time) and others say “do some cost-dollar averaging” but in light of the fact that you and I have to be wary of market crashes where millions of dollars can be immediately wiped out, what you have to do is be an independent thinker and learn to spot the trends.

Look at your 401k and see if it didn’t (unnecessarily) take a huge hit, if you dare. This is what happens when you “invest” and other people manage your money. That, and unnecessary fees that you may not even know you’re paying! Worst than that, if you decide you want to take money out, you'll be hit with penalties of 20 percent or more.  Ogre’s rule #1: If your employer isn’t matching you dollar for dollar, leave the 401k crap alone. 401k accounts are just another way to keep you unaware, detached. Someone else does the work and you don’t worry about it. And by the time you’re 62, maybe you’ll have a couple hundred thousand? Maybe not. It is impossible for someone else to care more about your money than YOU. Ogre’s rule #2: Start caring by investing your own money (open a low cost trading account like Sharebuilder) and by mindfully tracking the news (television, print, but especially internet) so that you can spot the clues that’ll tip you off as to The Man’s next move on the chess board.

If you don’t, you’re trusting someone who really doesn’t have your best interest in mind.
Brokers make money regardless of whether you make money or lose money. And I bet hedge fund and mutual fund managers are sleeping way better than you or I at night.

You have to realize that in this corrupt economy it behooves you to look for hidden agendas and be wary of those who advise staying the course, pro¬mote bargain buying opportunities, and casually pre¬dict peaks, bottoms, and time lines. Thinking for yourself and having the ability to see through posturing can be the difference between life and death.

Do it yourself and do it now! Whether you use someone’s predictive software or not, know what’s happening in the world around you. If you were a well-informed citizen, you’d know that the smart money is shifting out of the falling dollar and into currencies from countries with sounder economies. Gerald Celente predicts that in the “Global Age,” playing the best currency moves will become as common an investment strategy as was playing the stock market in the 20th century. Ogres need to get in the Foreign Exchange (FOREX) markets, and they need to do it NOW!

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