When Will The Market Correct?

daily chart Sept 22 2014

A down day with the Dow Jones down 107 points (-0.62%) and the Nasdaq down 52 points (-1.14%). 

While most markets continue to trade within a tight trading range, most investors continue to ask the same questions. When will the correction come and what sort of a catalyst will set it off? G20 finance ministers add to fears of a stock-market bubble

The big assumption or the error that I must bring to your attention here is that we will get some sort of a correction, not a multi year  bear market. As I have suggested so many times before, a bear market of 2014-2017 is just around the corner. Second, there won’t be a catalyst. The market will simply turn around one day and start heading lower. Accelerating pace as it goes along. Just as it did in October of 2007. And while some sort of a catalyst will be assigned to the market post-mortem (ex…. Alibaba going public), it won’t have anything to do with the actual turning point. Again, the market will simply top out, turn around and head lower.

If you would be interested in learning when the bear market of 2014-2017 will start (to the day) and its internal composition, please CLICK HERE

(***Please Note: Due to my obligations to my Subscribers I am unable to provide you with more exact forecasts. In fact, I am being “Wishy Washy” at best with my FREE daily updates here. If you would be interested in exact forecasts, dates, times and precise daily coverage, please Click Here). Daily Stock Market Update. September 22nd, 2014 InvestWithAlex.com

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When Will The Market Correct?  Google

Investment Grin Of The Day

investment grin of the day 45

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Investment Grin Of The Day  Google

Buy Low, Sell High, Go Short & Cover Case Study

nasdaq

Continuation from Friday…….(Buy Low, Sell High, Go Short & Cover Summary)

The premise is very simple. We will study the Nasdaq between 1994 bottom and today in order to determine how various investment strategies would have performed during the time. In order to initiate the process we must first have a clear understanding of exactly where we were in the cyclical composition of the stock market back in 1994, where we are today and what had transpired in between.

In my previously published book Timed Value a considerable amount of time was spent on discussing two powerful cycles that tend to rule the overall stock market since it began trading in May of 1790. These cycles are the 17-18 Year alternating Bull/Bear cycle and one completed growth unit within the stock market, most commonly represented by a 5 Year Cycle.  Let’s now take a closer look at both, starting with a bull market cycle of 1914-1932.

THE 17-18 YEAR CYCLE IN THE STOCK MARKET:

  • 17.5 Year Bull Market (1914 bottom to 1932 bottom): The previous bear market terminated in July of 1914. At that time the US stock market shut down for World War 1. The stock market remained closed between August of 1914 and December of 1914 (a very rare occurrence). When the market finally reopened in December of 1914 it immediately began a rally that would not terminate until October of 1929. Followed by a now famous 1929 stock market crash and a massive 90% 3 year decline. The cycle terminated at the bottom in 1932, completing the 17.5 year bull market cycle at that time.

*Note: It is important to address the 1929-1932 bear market and its impact on the overall 1914-1932 Bull Market cycle. It is a complex matter to discuss without sufficient background or understanding, but the final (short-term) structural composition of this Bull Cycle inverted over the last 3 years (1929-1932). Mostly due to a massive rally between 1924-1929 and a number of down cycles converging on this time period at the same time.  Regardless, the overall cycle lasted 17.5 years.

To Be Continued Tomorrow…….

Z30

Buy Low, Sell High, Go Short & Cover Case Study Google

Alibaba Stupidity

daily chart Sept 19 2014

9/19/2014 – A mixed day with the Dow Jones up 14 points (+0.08%) and the Nasdaq down 14 points (-0.30%).

I have two things for you to ponder over the weekend.

Alibaba worth more than $200B… just what is it?

I think when the history books are written this massive Alibaba (BABA) IPO might be viewed as the “Ringing of the Proverbial Bell” for this bull market cycle. And do I really need to talk about its valuation? As I write this, the company is selling at 24 times revenue. For god’s sake……Tesla (TSLA) which is another highly speculative stock is selling at just 13 times revenue. Amazon, who most closely resembles Alibaba, is selling at just 1.9 Revenue. In other words, the valuation of Alibaba is 12 higher than Amazon and twice as high as Tesla. If this doesn’t scream out “MASSIVE STOCK MARKET BUBBLE/TOP” to you, well, you deserve to lose a lot of money.

‘Bubble in everything, everywhere': Marc Faber

We live in the world where a 25 year old financial commentator with a nice haircut and a bachelors degree in marketing can make fun of well researched investors like Bill Fleckenstein for, get this, missing the latest rally of 2%. Over the last few months Marc Faber received the same treatment on at least two financial network. The question you have to ask yourself is this. Who would you rather listen to

  1. Openly bearish money managers like Marc Faber, Bill Fleckenstein, Carl Icahn, George Soros -OR-.
  2. Financial commentators who have no idea what they are talking about and/or who most likely have most of their money “well diversified” though at least 5 “well balanced” mutual funds.

The choice, as always, is yours.

This conclusion is further supported by my mathematical and timing work. It clearly shows a severe bear market between 2014-2017. In fact, when it starts it will very quickly retrace most of the gains accrued over the last few years.  If you would be interested in learning when the bear market of 2014-2017 will start (to the day) and its internal composition, please CLICK HERE

(***Please Note: Due to my obligations to my Subscribers I am unable to provide you with more exact forecasts. In fact, I am being “Wishy Washy” at best with my FREE daily updates here. If you would be interested in exact forecasts, dates, times and precise daily coverage, please Click Here). Daily Stock Market Update. September 19th, 2014 InvestWithAlex.com

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 Alibaba Stupidity Google

Should Janet Yellen Declare Victory?

daily chart Sept 18 2014

9/18/2014 – An up day with the Dow Jones up 109 points (+0.64%) and the Nasdaq up 31 points (+0.68%). 

The consensus is in. Everyone and their day trading grandmother now believe that the markets can only go up. The FED has done the impossible by printing money and stabilizing the economy. Even Mr. Obama was so excited about the news that he committed the biggest sin of all. He took full credit for this ” incredibly strong economic recovery.”  I wonder if he will take credit when this economic miracle blows sky high.

Unfortunately, most investors are committing a massive mistake by believing that the FED  A. Had anything to do with stabilizing the markets back in 2009 and B. They will now be able to anticipate and prevent future declines. They are once again confusing cause and effect. The FED is always behind the ball. And you don’t have to look further than every single financial crisis over the last 30 years.

It is the stock market that drives FED policy and not the other way around. Just remember the following. One of these days the market will stop going up, reverse and initiate a massive bear leg. Regardless of whether or not Janet Yellen likes it. You have been warned.

This conclusion is further supported by my mathematical and timing work. It clearly shows a severe bear market between 2014-2017. In fact, when it starts it will very quickly retrace most of the gains accrued over the last few years.  If you would be interested in learning when the bear market of 2014-2017 will start (to the day) and its internal composition, please CLICK HERE

(***Please Note: Due to my obligations to my Subscribers I am unable to provide you with more exact forecasts. In fact, I am being “Wishy Washy” at best with my FREE daily updates here. If you would be interested in exact forecasts, dates, times and precise daily coverage, please Click Here). Daily Stock Market Update. September 18th, 2014 InvestWithAlex.com

Did you enjoy this article? If so, please share our blog with your friends as we try to get traction. Gratitude!!!

Should Janet Yellen Declare Victory?  Google

Inspiration Of The Day

Investment motivation of the day

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Inspiration Of The Day Google

Venture Capital

venture capital

Continuation from yesterday……(How To Raise Money From Angel Investors)

And what does being ready mean?

First, you should already have something built.  While having a finished product is your best bet, a prototype or a beta type of a situation might work as well. Keep the following in mind. Very few angel investors or venture capitalists will invest in an idea.  In fact, I have never seen it happen personally, although I have heard about it.

Second, have a detailed business plan written out. It is a must have to show potential investors. You must illustrate in a very clear fashion that you know what you are talking about, what the market forces are, financial, etc…. Simply put, without a detailed business plan most angle investors will not be capable of properly evaluating the legitimacy of your investment opportunity.

Again, the threshold here is very easy and straight forward. If you cannot put a legitimate business plan together, how are you supposed to run a business?  Chances are, you cannot.  Therefore, if you can’t put it together, you have no business approaching either angel investors or venture capitalists.  Do not waste their time as it is almost a certainty that you will not get anywhere.

Venture Capital

Everything that was mentioned above in regards to angel investors applies towards venture capitalists, but on a bigger scale. That means more expansive capital, higher threshold requirements and for the most part a bigger capital investment.

The keyword for venture capitalists is TRACTION.

If you are starting out with just an idea, at times it wouldn’t even be appropriate to approach venture capitalists.  You are not ready and they are not interested.  In fact, think of venture capital as growth capital. For the most part, venture capitalists are interested in growth concepts that are already getting customer traction.

Still, if you do decide to approach venture capitalists the best way to do so is through your network or their existing portfolio companies.  An introduction is always the best possible way, but it is not an option for many.  Try to avoid a shotgun approach here. Meaning, you would be much better served researching any given venture capitalist for some time and coming up with a unique proposition as to why they should listen to you.  This will guarantee a much better success rate as you unlikely to hear back from anyone if you attempt to contact them in mass. Weather it is through email, mail or in any other fashion.  Finally, finding venture capitalists should be relatively easy as multiple lists are available online.

Personally, I have mixed feelings about venture capitalists. They are wonderful and very smart people. Yet, they are under constant pressure from their own investors to hit that next home run or to earn a significant positive return.  As such, their interests are not necessarily aligned with yours.  It is their job to make as much money as possible and they will do whatever is necessary to get that done.  Sometimes that includes destroying companies they have invested in or replacing top management, including you.  Be aware of it, but don’t blame them. That’s just how the game is played at that level.

To Be Continued Tomorrow…….(Why Am I Seeing This On A Financial Website?)

z32

Venture Capital Google

Buy Low, Sell High, Go Short & Cover Summary

Continuation from yesterday……(The Reason Most People Buy High and Sell Low)

With that in mind, it is now time to bring all of the points above together in order to formulate a clearly defined investment strategy.

Buy Low, Sell High, Go Short & Cover Investment Strategy Summary

stock market cycle

Know Exactly Where You Are At All Times.

Whether you are investing in individual stocks or the overall stock market, you must have a clear understanding of exactly where you are in the cyclical composition of the underlying financial instrument.   Luckily, you only have a few options.

  • Market Bottom:

Cover your short positions and prepare to go long. Identify substantially undervalued securities.

  • Bull Market:

Buy and hold substantially undervalued securities. Continue to add to your positions and/or buy newly discovered undervalued securities throughout the duration of a bull market.

  • Market Top:

Liquidate all of your long positions and prepare to go short. Identify good shorting opportunities. They can either be stocks you were long or stocks that are expected to decline at X multiple to the market.

  • Bear Market:

Take short positions in the overall stock market or individual stocks once a bear move is confirmed.  Continue to add to your short positions for the duration of the move. Cover once the bottom is reached.

Then simply rinse and repeat.  The rules above, of course, can be applied to all time frames and to all financial instruments. For as long as you know exactly where in the cycle you are.  The primary benefits are as follows.

Risk Reduction:

  • Through the purchase of undervalued securities.
  • Through knowing where in the cycle you are.
  • Though having the ability to be on both sides of the trade at appropriate times.

Maximizing Profits:

  • Through having the ability to profit from both sides of the move. Long and short.
  • Through purchasing undervalued securities with significant upside potential or shorting overvalued securities with a lot downside.
  • Through compressing anticipated gains into the shortest time frame possible.

Let me now show you exactly how this works with a real life example and why this particular approach outperforms most others by a significant margin.

To Be Continued Tomorrow…..

Z30

Buy Low, Sell High, Go Short & Cover Summary Google

Running Angry

angry running

Continuation from Monday…..(What Would Buddha Do?)

Transforming STRESS Into Positive Energies

Once you know how, transforming your internal energies from one form into another becomes a whole lot of fun. Just as if you were choosing from dozens of ice cream flavors, you have a hidden ability of taking any flavor of your internal energy and then transforming it into whatever it is that you wish. For instance, you can take sudden bursts of anger energy and then instantaneously transform into laughter or you can take jealousy and transform it into love or you can take stress and transform it into compassion. You can even take any of the energies within, supercharge them and then release them to the outside world if it serves a purpose.

Perhaps my running activity would be a perfect illustration of what I mean.  In short, I really enjoy running when I am incredibly angry. If for no other purpose than getting a better work out and making the entire process a little bit more fun.  Yet, as was mentioned in the previous section it is next to impossible to make me upset, let alone angry. Someone would have to go out of their way and dedicate real time and resources to bring any sort of anger out of me.  As such, artificial anger generation becomes the only option.

Typically, to get my anger energy flowing I concentrate on recent political issues that I might disagree with and past events where people have done me wrong. I then begin two oscillate between both issues while consciously imagining how idiotic the people in question are, what should be done and what my payback will be. With a few tricks I can then escalate this energy into a furious firestorm of anger within my belly.  All within the first five minutes of starting my run.

And the point?

Once my anger energy is at a boiling point I consciously flip an internal switch and transform this anger energy into a literal jet fuel that supercharges my running output. So much so that I typically shave off a minute off of my regular mile pace of 8 minutes. With pure anger fueling my short legs I usually have no problem holding 7 minute a mile pace for well over an hour. Only to drop near exhaustion after my anger jet fuel literally runs out.

And while we already talked about this in the previous section, it is worth repeating what happens behind the scenes.  Simply put, as I start my daily runs I consciously access my unified energy reservoir and its daily allocation.  I then knowingly introduce anger into this unified energy field and though the process describe above start to spiral it into a concentrated field of pure anger energy.

To the point where all of the energies within me become ANGER. Once this heightened state of anger is achieved I then deliberately transform it into the jet fuel energy used in my daily runs.  So much so that this little trick gives me the ability to function at peak performance levels throughout the entire ordeal.

To Be Continued Tomorrow……(Why Am I Seeing This On A Financial Website?)

Z31

Running Angry Google

What You Ought To Know About Your Stock Market Gains Vanishing Into Thin Air

daily chart Sept 17 2014

9/17/2014 – An up day with the Dow Jones up 20 points (+0.12%) and the Nasdaq up 9 points (+0.21%)

Most markets continues to trade within the confines of their 3 week trading range. And despite Janet Yellen’s dovish stance, one primary question remains. Now what? With today’s backdrop of less liquidity, proposed higher interest rates and a massive speculative bubble in the stock market (well, most asset classes), what happens next?

Perhaps Bill Fleckenstein has the answer. Fleckenstein on missing the rally: ‘So what?’

“I think the stock market is more crash-prone than ever,” Fleckenstein said Tuesday on CNBC’s “Futures Now.” “So will we get through September and October without some sort of an accident? I don’t think we will, but I don’t know-we’ll just have to see. If you want to pursue idiots like the Fed doing crazy policies, and if you think you can get out in time, go for it. I don’t want to try to do that. Fleckenstein may have missed out on gains, but “so what?,” he asked rhetorically. “When markets decline, how fast it will be taken away from you.”

He is right on the money and that’s what most people or investors don’t get. Despite the bulls hyperventilating about how great this bull market is, once a bear market gets going or god forbid crashes, most of the gains accumulated over the last few years will vanish into thin air. In a matter of weeks, if not days. In fact, repeat after me…. “POOF”. Yep, just like that.

This conclusion is further supported by my mathematical and timing work. It clearly shows a severe bear market between 2014-2017. In fact, when it starts it will very quickly retrace most of the gains accrued over the last few years.  If you would be interested in learning when the bear market of 2014-2017 will start (to the day) and its internal composition, please CLICK HERE

(***Please Note: Due to my obligations to my Subscribers I am unable to provide you with more exact forecasts. In fact, I am being “Wishy Washy” at best with my FREE daily updates here. If you would be interested in exact forecasts, dates, times and precise daily coverage, please Click Here). Daily Stock Market Update. September 17th, 2014 InvestWithAlex.com

Did you enjoy this article? If so, please share our blog with your friends as we try to get traction. Gratitude!!!

What You Ought To Know About All Of Your Stock Market Gains Vanishing Into Thin Air Google