Monday, September 3, 2007

Trading Commodities - What Style Of Trading Matches Your Mental Make-Up? - PART 2

Matching your mental make-up to a method of trading is possibly the most important aspect of trading to get right. There are many traders who fail every year simply because they force themselves to do things they should not be doing. Read on to see why and how you can find out what trading style is best for you!

Professionals use their intuition all the time. A doctor uses his intuition when he makes a tough decision. He would have no intuition if he had not paid his dues learning and observing for years beforehand. The same goes for an electronics technician. He can look into a familiar piece of equipment, take some basic readings and give a pretty good guess where the trouble lies. Ask the doctor to do the technicians job and he is lost.

My point is, study hard to learn what creates a good turning point or opportunity in the S&P 500 futures market and then you will be able to recognize them in real time - intuitively. Some futures traders will never develop these skills no matter how hard they try, whereas others can do it with training. It requires focused analytical skills, a patient temperament and most importantly, the aggressiveness to step up to the plate and put real money on the line.

Few commodity traders ever get all three skills firing on all cylinders. We need ALL three working all the time, believe me. Some say musicians are well suited for spotting market patterns learned from playing pieces over and over to perfection. Some say that women are well suited for intuition. And maybe yoga masters are well suited for the patience needed to wait for the best market set ups. So would an aggressive female musician who practiced yoga be a good trader? I would put my money on her to be a successful commodity trader verses someone who had none of these inherent skills.

Why do I believe this? Many times Ive been right on the mark by calling a market turn but hesitated and just couldnt pull the trigger. (Lacked confidence and aggressiveness) Or lost my patience and started taking what I call drunken sailor trades. (These are commodity trades that have no rhyme or reason - all emotional). Or I had the aggressiveness to trade that session, but the market just had no opportunities that day or maybe I just didnt SEE them.

Knowing when NOT to trade because you are not firing on all three cylinders is as important as knowing WHEN to trade. How easy it is to wash away recent profits on a bad day! And, conversely, profits can come easily on those days when everything just clicks. Weve all tasted these times.

As once said: Beware of that man, for he knows himself well. Know yourself well, your strengths and especially weaknesses, and gain an edge on the competition.

Good Trading!

There is substantial risk of loss trading futures and options and may not be suitable for all types of investors. Only risk capital should be used.

Thomas Cathey directs the managed futures division of Thomas Capital Management, LLC. Get FREE, his complete 44+ lesson, "Thomas Commodity Trading Course" and weekly TimeLine newletter by visiting: The course is brand new and fun reading... a "street-wise" trading e-course. Visit the main Thomas Capital Management trading website at:

So, Where Does All The Money Come From?

When you talk about Capital Homesteading credit the first question that always pops up is, "Where does all the money come from?" The answer is, it comes from the government of the people, by the people AND for the people, via the Federal Reserve (which has the right to extend credit as it sees fit). And yes, it does create (FHA like) red ink, but the red ink

(a) is not repaid from taxes, savings or wages,

(b) has a well defined, systematic exit plan of how to get in and get out (kind of like Operation Desert Storm) of that credit/loan

(c) it has a productive purpose.

So the real issue IS NOT where does all the money come from? The answer to that question is always the same. The real issue is whats the difference between PRODUCTIVE and DESTRUCTIVE uses of credit, and their effects on individual citizens, and the economy in general. So let's talk about the ways that credit can be used productively, and the ways that credit can be used destructively. Lets talk about how we can embrace the first, and eliminate the second.

Many people, for example, are convinced that a formal college education is the key to economic success in the modern age, so they're perfectly willing to help their kids pay for (often in the form of extended credit) that college education because Mom and Dad see it as investment in their kid's future...a PRODUCTIVE investment.

The Big Bank however, sees this college education in a different light when they extend (consumer) credit card offers to college kids across the country. So, what does Joe College purchase with that credit card? Boom boxes, CDs, DVDs, MP3s, video games, gas for daddys car, a six pack of beer for this weekends party, and other essential items required by the modern collegiate learning experience.

Big Bank And Joe College VS
Hey, dont get me wrong here. Big Bank knows exactly what its doing when it extends that credit offer to Joe College. Theyve carefully studied all the data, and theyve concluded, based on empirical evidence, that this particular marketing strategy is profitable for them. In other words, before they ever extend this credit offer to Joe College, they know that they will make their money back and lots moreor else they would never do it. Its a good bet. Its just as simple as that.

Capital Homesteading And Johnny Paycheck To Paycheck
Lets contrast Joe Colleges credit offer from Big Bank with the concept of extending a Capital Homesteading credit to Johnny Paycheck To Paycheck. What youll find is that the credit extended to JPTP cannot be spent on non-productive consumer crap. On the contrary, it must be spent on a well-vetted, productive capital (i.e. stock) purchase, the kind that the conservative local banker (not some wild, dice rolling venture capitalist) would advise his local bank to purchase.

The loan will be repaid not from taxes, and not from JPTP's wages or his salary, but from tax deductible dividends generated by the productive capital (i.e. stock) purchase. This will take an average of seven years to pay off, at which point JPTP becomes the proud owner of a real live piece of the rock. He becomes a capitalist.

If done annually over a lifetime, JPTP will generate an earned income to augment his wage or salary. He will also create a privately owned and controlled nest egg that will free him from ever having to depend on the government (i.e. social security, medicare, medicaid) to take care of himself and his family...which by the way, will also unload the government and justify TAX REDUCTIONS!.

Now like the boys from Big Bank, the local banker will have studied all the data and will have a real good idea what the odds of repayment are going to be, before he ever advises JPTP to place his investment bet. Actually the odds of repayment are much better with JPTPs Capital Homesteading credit than with Joe Colleges consumer credit.

Consumer Crap VS
There is one much more important difference however. The difference is that the purpose of Big Banks Joe College marketing strategy is to get JC hooked on the consumer mentality of easy (buy now pay later) money, and in the long run, to program him to believe that its completely normal to exchange his long term financial freedom for immediate gratification when it comes to consumer crap that he wants to have right now. Once hes fully programmed, Big Bank will wrap its financial tentacles around Joe College, who will then be transformed into the Big Bank's profit producing mule for years to come.

A Legitimate Piece Of The Rock
On the other hand, the Capital Homesteading credit, as weve already said, must go toward winning Johnny a piece of Americas growing economic pie, a piece of the rock that will predictably pay itself off, and in the process, begin to transform Johnny Paycheck into a capital owner who has a vested interest in the future of a particular company, in a particular community, in a particular county, in a particular state, located in the United States of America. So what we're talking about here is a DISTRUCTIVE (consumer) use of credit, compared to a PRODUCTIVE (capital homesteading) use of credit.

Let Freedom Ring
And as his productive piece of the rock grows year after year, JPTP will begin to feel the chains of his wage slavery loosen, and the bell of financial freedom ring louder and louder, until he's finally able to sing right along with Martin Luther King himself, free at last, free at last, thank God, Im free at last.

In the lobrng term big picture the Capital Homesteading strategy is specifically designed to create a nation spilling over with more and more capitalists who are actively participating on the ownership side of the free market economy, instead of a nation spilling over with more and more workers who are effectively cut off and alienated from the modern economic miracle known as the free enterprise system. The Big Bank strategy is specifically designed to create programmed automatons who unknowingly trade their financial freedom and future in for consumer crap, and who, as the result can be easily controlled and dictated to by the captains of industry from their high rise corporate suites up on Wall Street.

Its Our Choice
So I guess the choice comes down todo you really want to underwrite a free enterprise economic system, and transform America into a real capitalist nation chock full of real live capitalists? Or do you prefer to create a nation thats primarily full of workers (sounds communistic/capitalistic to me), who are systematically required to compete tooth and nail with each other, driving wages lower and lower (lets become a third world nation ASAP, or redistribute from top to bottom in order to temporarily prevent the economy from falling flat on its face!) so that the captains of industry can oversee their respective monopolies without really having to concern themselves with legitimate competition. That way they can all get together, buy out the little guys, fix prices, fix elections, smoke big Cuban stogies, drive their fancy cars, and generally live off the fat of the land. Yes Tonto, I guess you could turn the clock all the way back to them thrillin days of yesteryear, if you wanted to. But do you really want to?

P.SViva Las Vegas!
I have one final thought to offer here. If all those incredibly bright and intelligent, bureaucratic bean counters in Washington, DC are simply unable to recognize a good bet when they see one, then I know there are plenty of folks out in Las Vegas who dont suffer from that same moronic, myopic malady. I mean its their business to assess the odds accurately, facilitate the bet, and they make lots of money in the process. They do it every day of the year, and twice on Sunday.

Yah sure, I know youre going to tell me that those folks out in Vegas are all crooks. But that comment simply begs the question. How does that make them any different than the crooks in DC? Now, if youre unable to come up with a believable answer to that last question, I suggest that we consider taking bids from both DC and Vegas. If Vegas wins, well just call itoutsourcing.

Joe L. Buckett is a Chicago based, freelance writer who in 2004, was our nations first virtual candidate for the Presidency of the United States. If you're interested in learning more about Joe Lunch Bucketts common sense solutions to 21st century problems, ranging from the war in Iraq, to Social Security, and Immigration, check out his book entitled "The Big Idea," which you can order on either Barnes and Noble or Amazon.

Forex Trading Advice Don't Take Any Forex Advice Until You Read This

Would you take driving lessons from someone who had never driven in their lives?

Of course you wouldnt!

With forex trading advice people take advice from people who have never traded and never question it, lose their money and are surprised.

If you are taking forex advice via signals or a system there is only one criteria you need to judge the advice on:

A real time track record.

Thats real money, made in the market over a 3 year period or longer.

It does not guarantee you will make money of course, but if I follow advice I like to know the forex trading advice I have taken, has made money and the logic is soundly based.

Forget hypothetical track records.

Anyone can make a profit if they know what the prices did!

Ever seen a hypothetical back tested system that didnt?

My six year old boy could make a profit that way, but not sure I would trust him to trade for me!

I am a trader of 20 years and I see e-books and makings telling me I can easily make 90% accurate trades or 100 pips a day!

Please dont insult my intelligence.

I know making money is not easy in anything and that includes forex trading.

Use common sense!

If forex trading advice looks to good to be true it probably is.

Use common sense and dont get blinded by greed or an easy way to make money you will lose.

Only take forex trading advice from vendors who provide the following:

A real time track record and the comfort of a money back guarantee.

There are plenty out there giving good solid advice that can help you make forex profits, but take a bit of time to seek them out.

Dont fall for the scammers in forex trading advice offering you easy ways, or guaranteed profits. You will lose.

Only a small minority of traders make money and there not the above.

They will simply make money out of you from selling advice that will lose you money.

Accept this fact:

Forex markets can and do make money and there is good advice out there but forex trading makes few traders rich over night.

Forex trading is a long term solid way to make money and good profits.

Make sure you dont fall for the hype of the huge amount of forex advice sellers on the net who have never traded in their lives.

No real track record you know what to do now

In conclusion with forex advice to separate the scammers from the people who make money, get the real time track record.

Thats it - Enough said.


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