You whine, bitch and complain about everything. Is it a liberal thing to constantly complain about life's injustice? To invest you have to divorce yourself of all emotions, well except for greed.

I don't invest in media companies, but I do own Altria. You know, the guys that make Marlboro cigarettes. I've owned their stock for years. You can't name me any other company on planet earth that has been litigated, chastised, scrutinized than Altria. Tobacco is not only a health issue, but it generates a lot of emotion, especially from those on the left. Fox has nothing on Altria with respect to bad press, and general shit hitting the fan.

When making money don't get emotional. Look at the bad news only in context of how it will affect the performance of the company going forward.

See willy, you don't have what it takes. My suggestion is to invest in a nice simple socially responsible mutual fund. Yep, they got them. These mutual funds only invest in companies that are good stewards of the environment, or care about human rights, diversity, consumer protection, social good. You know, that kind of shit.

Yes I own Altria. I also own shares in a gaming company. Damn, come to think of it, I need an alcohol company to complete the trifecta of vice.

I was actually thinking about it, but what would be the word for four vices? Would it be "fourfecta"? I do gambling, but it ain't horse racing.

A publicly held company based out of London. They have it all....beer, whiskey, vodka, rum, tequila, just about everything.

Speaking of mutual funds, there are tons of socially responsible mutual funds, but I only found one, yes only one, VICE fund. It's symbol is VICEX, and its holdings have tobacco, alcohol, and believe it or not defense companies. I can see defense companies being on the vice list for liberals. They don't like guns, but damn, most of the male liberals on the board like a good cosmo, pina colada, or any other gay drink (lol), so go figure.

Hey inicky, you're right. VICEX's performance short and long term is pretty good. I compared it to a few socially responsible funds, and guess what? Yep, VICEX kicked their ass. Understand I just checked a few. Thank God for alcohol, cigarettes, guns, gaming and pussy.


http://www.diageo.com/en-row/Pages/default.aspx

Fox News will not lose their broadcasting license.  No chance in hell.  I won't even begin to get into the countless reasons why.

But the Left will cross their fingers and hope, hope, hope.  The less voices the better!

their alcohol to both men and women, seeing that most men like harsher-tasting liquor than women. I know that's a generalization; not all women like sweet drinks, and not all men down Scotch like it's water. The point is still the same.

You go, StC!

generally produce sub-par returns.  Speaking of the "trifecta of vice," I wonder if there's a public company anywhere involved in prostitution?  Now THAT would be a trifecta! Almost as good as owning Exxon-Mobil.

Need a gun manufacture too,

Then you can own the Four Horesmen

-- Modified on 7/14/2011 3:56:53 PM

I don't gamble or smoke (well, rarely) or do drugs (used to but now stick to alcohol).  My trifecta is Whiskey, Women and Fast Cars.

I'm going to venture a suggestion and I'll let St.C or GaG opine on whether or not my following suggestion is "dumb" based on what I percieve as your financial acumen.

In regards to a primer, many years ago I found a pamphlet by the Wall Street Journal called The History of Money or some such thing. It was kind of a Dummy's Guide which began the history of money dating back to caveman. While someone of yur IQ may find it insultingly simple, I found it really layed the groundwork for understanding the realtionship between money, goods and services, and items of economic value. I think seriously you need to start there.

As to St. C's question below, while I don't follow individual stocks so much anymore, group B builds the internet and group A uses it. That is the simplest explaination.

.............................................................................................................................
"So on one side is Google, Apple, Amazon and Salesforce.com. and on the other side of the ledger is Intel, Microsoft, Cisco and HP. What do you think the difference is between these 2 groups?"

If I had to guess, I'd say the difference is that the 2nd group has made less money. Beyond that, I don't know what you're getting at.

Is there a good beginner's primer out there on investing that I can read that's free of gibberish?

Care to chime in, Mari?

...............................................................................................................................

BTW, I think Mari's area of expertice is in financials.....J/K Mari. Just riffin....

but did you know that you can go long and short on a stock? Short is basically betting the stock will go down usually based on fundamentals, but also on scandals.

Let's just focus on Google. You picked one article where Google will compete in the social networking market. Have you looked at Google's financial performance? At the end of the day numbers don't lie. They just reported 2nd quarter results. What do those results tell you? Look at their share as it relates to Search, Chrome and You Tube. Chrome is to MS, what Google + could eventually be to Facebook. You want to bet against Google? Plus, add the fact that they added 2500 new engineers and still delivered phenomenal 2nd quarter results. Perception counts as much as actual results.

Have you ever walked into an Apple store at the mall? What do you see? Do you see a lot of people? Apple is a juggernaut, and Google's results are a "tell" on what I think Apple's results will be.

How the street values "SOME" technology companies is different in how they value companies in other industries. So on one side is Google, Apple, Amazon and Salesforce.com. and on the other side of the ledger is Intel, Microsoft, Cisco and HP. What do you think the difference is between these 2 groups?

I'll let marikod give you his investment thesis on Netflix.

Come on, what kind of gambler are you anyhow?

BTW you forgot to mention fear along with greed as emotions that pertain to the market. Fear is every bit as much a driving force where it comes to the financial markets and understanding how fear drives a market can be quite profitable as long as you can disconnect from your own fears.

You do realize of course that trying to explain any of this to Willy is a compete waste of time, but maybe someone else will read it and get something out of it.

and I'm going to assume inicky doesn't as well, but his "quad-fecta" sounded almost plausible.

Have fun in Colombia this weekend. With carmageddon this weekend (only LA could come up with this term), I need to avoid LAX. I'll just head to BUR for a flight to Vegas, instead of going to Mexico.

-- Modified on 7/15/2011 8:30:44 AM

Thanks to my idiot "ex" bank, I am stuck here until at least Monday GRRRRR

The fucking idiots at Chase Bank are morons. I just closed out every account I had with them and pulled every last penny out of their bank, fucking retards!!!

Enjoy Vegas.

Hopefully, I'll still get to Colombia, but it looks like it will be next week. In the meantime I guess I should go get laid, that should put me in a better mood.

The mechanics of how you "short" a stock to bet that it will go down in value are like this.

You borrow shares of ABC stock today and sell it at todays price, lets say a thousand shares at $10. At some point you have to cover your position by actually buying the stock.

Let's say the stock falls to $5, you can then "cover" your position by buying a thousand shares of ABC stock for $5 a share to replace the shares that you borrowed and then sold, making a profit of $5 per share, which means you made five grand on the trade.

Now lets suppose the price of ABC goes up, you still have to eventually cover your position by buying the stock at some point.If the stock has gone to $20 when you cover you will have lost $10 a share, which translates into a Ten thousand dollar loss on the trade.

This is where the "pain" of shorting stocks comes in. There of course is no limit as to how high a stock can go, so your risk is unlimited as opposed to going "long" on a stock where it cannot go below zero, thus limiting your risk to 100% of the purchase price if the stocks falls to zero. Can you imagine how much money you would have lost if you had shorted Google from it first day of trading?

One other thing to keep in mind is that if the issue that you are "short" on continues to rise the entity that you borrowed the stock from is going to want security from you that you will have the means to actully cover your position, This comes in the form of a "margin call" failure to put up more capital to meet your minimum "margin" will result in a forced liquidation or more accurately a forced "cover" where you are forced to buy the stock at the prevailing price whether you want to or not if you are unable to post more collateral in the form of cash in your margin account.

Shorting stocks is not for the faint of heart, but there is a lot of money to be made at it if you have the stones, and the money of course. I would not recommend it for amateurs.

beginner. Go hang out at your local Barnes and Noble. Three that come to mind are:

"Stock Investing for Dummies" - same yellow book
"The Intelligent Investor" by Benjamin Graham - mari will thank me for recommending this book
"One Up On Wall Street" by Peter Lynch

Read some of the business magazines at Barnes & Noble so you can get use to the language.

I've been investing for about 20 years, and guess what, I'm still a novice. This shit is confusing.

Group A are great companies. They are leaders in their space. They are viewed as innovative, creative, i.e. where the "next big thing" comes from. They are viewed as GROWTH companies. Oh yeah, their financial performance is stellar. Making money is important, but it's the quality of the money as well. I don't want to say Group B is the complete opposite, but they are no longer viewed as innovative, creative, etc. They used to be viewed like Group A at one time. Somehow they lost their way.

For a short to be legal, someone must own the shares that are being sold.

Selling a stock without first borrowing it is called a "naked short sale" and is illegal due to the many abuses made when groups of specualators would "gang up" on a stock and send it into a tail spin. The very act of millions of shares being dumped at the same time is often enough to cause a panic in the "real investors" and can literally bankrupt a company as they lose market cap and reputation.

It is technically possible to cover your short from the outset, but it defeats the purpose. By shorting, you are betting that the stock is going to lose value and that you can buy it back for a cheaper price than what you paid. If you "cover" your postition from the outset, there is no gain or loss, and all you have succeeded in doing is paying for two "wash" trancsactions.

Many investors who correctly identified that the dot.com boom was illusionary and that the numbers made no sense were trampled in the 90's as people rushed to buy issues with little or no real earnings, or even earning potential. Although these "sensible" investors were later proven right when the bubble burst virtually every one of them went broke by being correct "too early" noone can hold a short position forever during a stock market boom, eventually either the pain becomes to high, or the margin requirements to large and the short seller has to cover before he is rendered insolvent.

Many people think short sellers bring nothing of value to the market, but those people are absolutely wrong, short sellers bring and added layer of liquidity to the market place and the market is much better with them than without them. Most of the criticism of short seller is made by unsophisicated observers who don't really know what makes the market function and it's just one of the many reasons I hate it when amateurs try to tell professionals why they are wrong without any basic understanding of the basics, This is not a shot at your personally Willy, even though you are one of the biggest offenders, I am just stating a fact. Even St Croix will admit after twenty years of doing this he still has a lot to learn, and that goes for me as well with even a longer time in the business.

-- Modified on 7/15/2011 1:59:51 PM

I don’t recommend shorting a stock unless you are an experienced, savvy investor, and I’m going to leave myself out of that category as long as the red  around my Bank of America account at E Trade rivals the red I saw in the Texas Chainsaw Massacre.

      But if you think Bank of America is going lower than its present $10.00 a share price, here is how you would short it:

     1. You have to have a brokerage margin account with the minimum balance that your broker requires for short sales.

        2. On E Trade, you simply enter a “sell short order” for BOA  on the website. E Trade then borrows those shares from another customer and places them in your account (and charges you a fee of course plus interest on the amount you have borrowed).
       
     You then sell the borrowed shares on the open market (for which E Trade charges you a fee).
     
      So if you borrow 100 shares at $10 a share, you immediately make $1000, subject to E Trade’s fees and your obligation to replace the 100 shares you borrowed.

      3. If BOA goes down to $8, you place a “buy to cover” order on E Trade to buy 100 shares on the market at $8 or $800  (again E Trade  again charges you a fee). E Trade buys the shares, returns them to the other customer, closes out your position, and you pocket a $200 profit.

      4. But here is the Devil’s Bargain of shorting – if BOA zooms  to $100 per share, you will see me celebrating and GaGambler and St. Croix moaning that they should have listened to me.

       But for you  E trade comes calling and wants it stock back – so now you have to place that “buy to cover” order for the stock at this price – now it costs you $10,000. So you have a huge loss instead of that $200 gain.

     So short selling is quite risky- theoretically your losses are unlimited if BOA soars to the sky. (…sign). Now back to reality.

to either buy or sell the underlying security at a given price, for a premium of course. A call option is the right to buy, a put option is the right to sell.

The advantage of course, is that lack of obligation to cover, limits your risk to the cost of your option. That premium will vary depending of the "strike price" which of course determines the relative risk of the option which can vary widely depending how far "out of the money" the option is.

If you actually own a particular security you can also make money by actually "writing options" where you are the one selling the right to buy that security to someone at a certain price and you are the one receiving the premium. The downside to writing options is that if the stock you own takes off, someone else will be the one getting rich,but if the stock remains flat or loses value, you get to keep the premium and the stock, a good hedge for many people who are averse to risk.

Most on line brokerage firms will get the job done, a lot depends on how many trades you make and if you absolutely need instant execution.

I recommend anyone who actually trades stocks as opposed to  simply investing in stocks get a better platform than E trade.

If you are going to buy and hold like Mari, then E trade or any of the other online brokers should be fine.

When I did this for a living I used a platform called "Real Tick" for about five grand a year it gave me "level two" "time and sales" charting, multiple tickers, charts etc and virtually instant execution. I spent about another five grand a year for a news feed that would get me Bloomburg, Newswire etc live, without the several second delay that cheaper services offered.

As for fees, I mainly used ECN and as long as I was adding liquidity to the market my trades were essentially free. In volatile markets I would usually use the SOES system and make market instead of limit orders to make sure my trades went through and paid between 10 and 20 dollars a trade. Doesn't sound like much, but on occasions I would make over a hundred trades in a single day so it can add up, just like paying juice to a bookie. lol

and you are giving him the keys to a Ferrari (lol). Wow a 100 trades a day. I'm lucky if I do 100 trades a year.

Did you see BAC fell below $10 for a bit today? I honestly feel for mari. I'll tell you what, establishing a "stop order" on a security, has taught me do the same in Vegas.

I'm impressed you went to such level of detail for willy. I hope he appreciates the knowledge, and at a minimum, give him an appreciation for how the markets work. And that they are not inherently evil.

Sorry to hear you're not going to Colombia. Try and have a nice weekend regardless. Time to sign off and head for the airport.

-- Modified on 7/15/2011 3:50:04 PM

You are right that I don't play the ponies.  Or gamble at all, except in the stock market.  And I leave that to the pros who run my money.
As for this weekend, I've been too busy partying at the beach to post.  Also, I pulled a Mikey and spilled vodka on my keyboard last night, so posting has been a tad difficult!  lol!

Yes, and there are lots of rallies that are partly fueled by "shorts" capitulating and being forced to limit their losses by buying the underlying stock.

The only time when shorts can really do any damage is when a group of shorters gang up on a company, usually a company that carries a lot of debt, and start selling so many shares that the "real" investors start panicking and dump their shares as well.

A well organized group of short sellers can actually bankrupt a company that way. What happens is that a company with a heavy debt load needs to keep it market cap high in order to borrow money at a rate it can afford. If their market cap erodes, so does their ability to borrow money to keep operations going. IOW what you end up with is a self fullfilling prophecy that can actually end up ruining an otherwise healthy company.

One other note on the subject, if you short a company into oblivion and the company goes completely bankrupt, you never have to cover your position and your profits are completely tax free, by the same token if you are long a stock and it goes to zero, you are unable to claim the loss unless and until you sell, even if for $.00000001. If the stock is delisted you are SOL.

you mean I'lll NEVER get my money back onthe 3000 shares of WEBVAN i own?  maybe trade it for some bear stearns stock? lol.