Pondering the Important Issues

I actually bought a Sunday paper this past weekend, something I haven't done for a while. Reading about all the problems in the world just tends to detract from my retirement euphoria. A person can get a serious ulcer thinking about all of this stuff. I mean, the idea of a radicalized Iran with nukes isn't very comforting. Nor is the ongoing uncertainty about the price of oil. The election victory of HAMAS is kind of a bummer, and no one seems to have a clue about the economy. And I won't even mention the fact I've been afraid to check my stock market portfolio since January.

On the other hand, I do want to be responsible and keep track of what is going on the the world. Consequently, I will pick up another Sunday paper in about a year to see how this all turns out. I really don't see much point in reading the same stuff between now and then.

Besides, while I don't mean to trivialize these stories, I think there are other significantly more important issues to ponder. For instance, we all know that when dropped, a cat will land on its feet. We also know that if a piece of buttered bread is dropped, it will land butter-side down. These are both cosmic absolutes. But it does beg the question: what if you strapped a piece of buttered bread on the back of a cat and then dropped the cat??? To my thinking, that would be the ultimate paradox.

Certainly something would have to give; a known cosmic norm would have to be violated. Would such an experiment cause a rip in the fabric of space/time? Would the universe implode? Would the laws of physics be forever destroyed? The more I think about it, I find myself much more concerned with the idea of Iran obtaining cats and buttered bread than I do them getting nukes.

When I retired a few years ago I promised myself I would go fishing at least once a week. Here in Alabama where I live, we have gotten thunderstorms virtually every day for what seems like forever. That concerns me much more than the price of oil, especially considering I haven't been able to use my SUV to tow my boat to the Bay, in order to take out my 2GPH 200HP bassboat.

The past few months my garden has been beset with critters: squirrels, rabbits, deer, and just about every other variety of furry creature on four legs. I read in some of my garden books that putting certain unpleasant materials (garlic, certain oils, even urine) around the garden will keep them away. I also read that getting one of those fake plastic owls will do the job. None of it works of course. Unfortunately for me, the critters aren't able to read the same books as I do.

Even worse than that, the problem of the relentless heat down here has caused a shortage of Miller Lite beer. Now, you have to understand that Miller Lite is considered a staple in this part of the USA. In fact, there are known cases of people evacuating for hurricanes who forget to put their kids in the car but have a minimum of three cases of Miller. We do have our priorities afterall.

So as I sit here composing this article, sipping my Miller Lite slowly in order to conserve, I have to consider what is really important in life. Sure, our government is working hard to prevent some nutburger in Iran from getting nukes, but that doesn't get me on the water fishing. It doesn't get the critters out of my garden. And it sure doesn't help with the supply of Miller Lite.

Investing - A Beginners Guide

Managing the personal finances and to multiply it many fold needs prudent investment strategies. Without gaining adequate knowledge in investment, do not try your hand in various investment options, which can result in drastic and sometimes
disastrous results.

A new investor should first visit the local library and try to get various guides on personal finance. Issues relating to
personal finance includes basis for a budget, sticking to the budget, saving money for an easy retirement life, major purchases, and managing the accrued finances properly.

New investors should go through newspapers such as Wall Street Journal, which will familiarize the reader with insurance, stocks, investments etc. through their Friday Column aptly named "Getting Going" by Jonathan Clement.

A new investor should not barge into the stock market based on any half-baked advice by close relatives or friends. For getting
a proper idea about overall money management, study books such as The Intelligent Investor. For the sake of reference, this title is highlighted. If you browse in the bookstores or libraries, several other equally good guides might be available.

If excess cash is available immediately and if you are still going through the learning process, without wasting time, you can put the excess money in a mutual fund or even the bank.

Even though this learning process appears to be a daunting chore, it is better than relying on professional money market advisors
who will charge a hefty amount for guiding you in making money. Ultimately, you and you alone are responsible for your financial
situation - win win or no win.

Once a new investor gets a fair idea about personal finance management, further studies in mutual funds, stocks and bonds will be the next logical step.

A mutual fund is money pooled by a group of investors, which is used to buy stocks or bonds from various companies and strives to
achieve a specified target of growth. Many mutual funds set 1000 dollars as the minimum initial investment money. A closed ended
mutual fund is similar to a share issued by a company trading in the stock exchanges. It can be traded through a broker just like
any other stocks. Open-ended mutual funds assure a fixed annual income without any surprises.

Some of the popular mutual funds are money-market funds, balanced funds, index funds, pure bond funds, pure stock funds and tax-free bond funds.

The next logical step or the parallel step is investments in stocks.A certain amount of guesswork is needed for buying and selling them. To get some knowledge about the risks involved, try to play the investment games online, which simulates the practice of selling and buying stocks without losing money or facing any risk. After thorough familiarisation, a first trade in stock with
minimum investment can be tried.





Article written by Anastasia Phocas.

Efficient Market Hypothesis: Myth of Reality?

The efficient market hypothesis (EMH) was promoted by Eugene Fama in the 1960. In his classic paper Fama (1970) defined market in which prices always fully reflect available information as "efficient".While this definition reflects the main idea of the EMH it might be extended to explain the underlying assumption. For example Malkiel (1992) proposed the following definition:
A capital market is said to be efficient to if it fully and correctly reflects all relevant information in determining security prices. Therefore, more formally, the market is efficient with respect to some information set. ..if security prices would be unaffected by revealing that information to all participants. Moreover, efficiency implies that it is impossible to make economic profits by trading on the basis of the defined information set (Papers4you.com, 2006).

As it follows from the Malkiel (1992) definition if the market is efficient the company market value should be an unbiased estimate of the true value. Nevertheless it is important to stress that:
1. Market efficiency does not require that market price is equal to the true value
2. There is an equal probability that stocks over or under valued at any point in the time
3. And finally, investors should not be able to consistently identify under or over valued stocks using any investment strategy ( Damodaran, 2006).

What are the implications of the market efficiency from the individual investor perspective?
Firstly, equity research is costly and provides no benefits. Secondly strategies that have minimal execution costs such as randomly diversified portfolio or indexing to the market would be superior to any other investment strategy. Thirdly, a strategy that has minimum transaction costs should provide higher returns in the long run (Damodaran, 2006).

Nevertheless it is important to stress that markets are not efficient due to their nature, but they are driven to efficiency by the actions of the investors. Therefore Roberts(1967) distinguished among three forms of the market efficiency:
1. Weak form: the information set includes only historic data.
2. Semi strong: the information set includes publicly available information.
3. Strong form: the information set includes all information know to any market participant and includes private information.

Obviously in reality, investors have access to different information sets. While trading which is based on the insider information is prosecuted, analysis and interpretation of the publicly available information requires specific knowledge and skills (Papers4you.com, 2006). Therefore the efficient market should be seen as a self correcting mechanism, where inefficiencies appear at regular intervals but disappear almost instantaneously as investors find and trade on them.

EMH has wide applications in the financial markets, since it is easily extended to the valuation of companies , market failures such as an Enron Case, or performance analysis of the mutual funds. The traditional analysis of the market efficiency is based on the analysis of the anomalies such as Peso Effect in the foreign exchange market or devoted to the predictability of the stock returns.

References

Damodaran )nline (2006) "MARKET EFFICIENCY - DEFINITION AND TESTS", Available from: http://pages.stern.nyu.edu/~ADAMODAR/New_Home_Page/invemgmt/effdefn.htm [17/06/2006]

Fama E. F., 1970, Efficient capitalmarkets: Areviewof theory and empiricalwork, Journal of Finance, 25, 383�417.

Malkiel B (1992) Efficient market hypothesis. In NewMan P.M. Milgate ,and J Eawells (eds). The new Palgrave dictionary of Money and Finance.

Papers For You (2006) "C/F/94. Validity of the Efficient Market Hypothesis", Available from http://www.coursework4you.co.uk/sprtfina2.htm [17/06/2006]

Papers For You (2006) "E/F/38. Efficient market hypothesis: theory and implications", Available from Papers4you.com [18/06/2006]

Robersts, H. 1967. Statistical versus clinical predictions of the stock markets. Unpublished manuscript, Center for research in Security Prices, University of Chicago, May.

Are Hedge Funds Heading Into the Perfect Storm?

You are going to be seeing and reading a lot more about hedge funds in the coming weeks and months. Two loosely related disturbed fronts are moving towards each other that may yet converge into the perfect storm.

The S&P 500 Index, the proxy for the US stock market, is up only 1.97 percent for the year, and down 1.7 percent for the quarter. The Lehman bond fund index is down 1.5 percent for the year. US stocks and bonds comprise the overwhelming majority of assets in individual investor portfolios.

That means very little or no growth for pension fund and 401(k) beneficiaries. For mutual fund and pension fund managers that means skinny or no performance bonuses. In a word, the pressure is on to somehow make a silk purse out of the sow's ear of an underperforming US stock and bond market. That's being done. New filings with the SEC indicate that a growing number of mutual funds will adopt hedging strategies like short selling and option investing to keep investors from leaving the herd and taking their assets with them.

On the other side of the disturbed front, the real hedge funds, unregulated private investment pools with a $trillion plus to toss around, are getting some unwanted heat from the regulators. Although they were held off by a recent DC Circuit Court ruling in favor of the hedge funds, the SEC is hot to regulate the hedge funds and is lobbying hard for Congress to give it the laws to do so.

Hedge funds are not mutual funds. They are not bound by any investment strategy description in a Prospectus. A hedge fund can implement any investment strategy that you as a private individual who got together with a few friends could do. Other than the always applicable laws against insider trader and outright fraud that leaves lots of room for creativity and financial maneuvers.

For example, in 1994 the former head of Solomon Brother bond department and two future Nobel Laureates in Economics got together and started Long Term Capital Management hedge fund with a few friends and $1 billion in capital. Four years later LTCM was producing returns of 40% annually, and the hedge fund's off balance sheet positions totaled a gargantuan $1.25 trillion. There probably weren't a dozen people in the world who completely understood LTCM's enormously complex strategy, and not many more than that who even knew enough to ask an intelligent question.

The Russian government's bond default in 1998 created an international whirlpool of panic selling in other government's bonds that threatened to sink LTCM and suck the entire international financial system down with it. The ultimate disaster was averted but you can bet that the memory of what "that hedge fund could have done" is very much alive in Washington DC and among the veterans of the financial press.

How does this fit together to create the perfect storm? Negative stock market returns demand a cause, identifiable culprits whose evil deeds have shaken investor confidence and robbed people of their retirement. It doesn't matter if there is no actual connection if the story is compelling enough. Short selling hedge funds, fueled by the fallout from an insider trading scandal or two, make the perfect culprit. Hedge funds are not open to joe sixpack. The media and the public love villains.. The average hedge fund investor is a financial institution or a fabulously wealth individual. Who better?

Real Estate Finance Overseas

After the technology bubble burst back in 2000 the stock markets suffered a bleak period of decline and investors chose to place their focus on bricks and mortar rather than falling share prices and they began investing heavily into real estate.

As a result the second home and the buy-to-let real estate markets in many countries around the world such as in the UK, US and Australia boomed. However, as the real estate affordability gap continues to widen in these nations and fewer first time buyers can even get onto the first rung of the real estate ladder, property price increases have begun to cool off and the ability to generate impressive rental yields and strong capital appreciation has slowed right down for at least the short term.

At the same time the stock markets around the world remain volatile and so now many more investors are looking overseas for alternatives to cooling domestic housing markets and bumpy rides on the stock market. Many are finding that there's an abundance of real estate opportunity in emerging countries around the world which has created a strong demand for real estate finance overseas.

For those considering joining the jet-to-let real estate investment set here are the three main options available when it comes to raising real estate finance, loans or mortgages to buy property abroad.

1) In many of the nations that were the first to boom the property markets are now stagnant and because lenders have fewer customers to provide finance for they are actively targeting those who have yet to upsize, release equity or take out a second mortgage and offering them increasingly favourable terms, conditions and interest rates.

For anyone thinking about buying real estate overseas in a country where they believe it will be difficult for them to secure local finance or where interest rates are unattractive, the option may exist for them to re-mortgage their existing property or take out a loan secured against the equity in their primary residence.

The negative side of this option to raise real estate finance to buy overseas property is that the purchaser's primary residence will be the security against the loan and naturally this introduces an element of risk.

2) The second option available to buyers looking for real estate finance overseas is getting a mortgage locally in the country in which they want to buy. Some countries such as Spain, Germany and France for example offer attractive interest rates and payment schedules to buyers from other European nations and many countries offer mortgages to international purchasers who can provide a decent sized deposit.

Anyone thinking about buying abroad would do well to also research which banks and lending institutions exist in that country, whether they are allowed to lend to foreign buyers and if so, are the criteria for getting a loan and the terms and conditions of the loan favourable?

3) The final option available to the majority of real estate investors looking to finance the purchase of a property abroad is an international mortgage provided by an international lender who usually has experience in the country from which the borrower heralds and also in the country in which they wish to invest which can make the whole finance process so much simpler�but the downside is that arranging such mortgages can be far more expensive than the first two options available to those contemplating their real estate finance options.

The availability or applicability of any type of mortgage or finance raising scheme discussed in this article is something that needs to be determined on an individual basis therefore this article does not constitute advice. Anyone hoping to raise finance to purchase real estate overseas should seek expert financial advice.

"5 General Trends in the California Real Estate Market to Watch -- 2006"

"5 General Trends in the California Real Estate Market to Watch -- 2006"

Historically, the real estate trends of California have always been the precursors for the rest of the country. Which is why leading players of the real estate market keep a close watch on the Golden State's real estate market conditions.

And whether you are a first time homebuyer, debating the viability of building your dream house in San Bernardino, or a real estate investor looking to sell condominium units in Los Angeles, you certainly want to know: When is it the optimum time to buy or sell?

Purchasing a house is a major investment. With judicious planning, this valuable asset will appreciate with each year.

But how do you get the big picture? Fortunately, real estate trends are predictable because these develop over a long period, unlike the stock market, which is rather volatile.

The first thing you will need to do is to read and track real estate articles: the market reports of the California Association of Realtors or the California Building Industry Association, and the briefs created by housing analyst companies.

Once you have identified the following key indicators you will have a better grasp of the general trends in California's real estate market.

THE FIVE KEY INDICATORS TO WATCH

Interest Rates
When interest rates rise, buyers shy away. Conversely, lowered interest rates attract more buyers.

This year, interest rates in California are on an upswing. For example, thirty-year fixed mortgage rates, which averaged 5.71 percent in 2005, has risen to 6 percent levels in January 2006. And adjustable mortgage interest rates have moved up to 5 percent levels compared to 4.12 percent in 2005.

Building Permits
The higher the number of building permits issued, the higher the demand for houses.

Figures show that number of building permits issued for the year 2006, have fallen by 10 percent in comparison to last year's figures. In terms of houses, that's a decrease of 1,430 building permits compared to January 2005 figures, according to California Building Industry Association report.

Home Sales
This key indicator refers to the total number of homes sold. In the law of supply and demand, when there are few buyers, real estate prices fall.

The January 2006 figures of the California Association of Realtors reveal that the number of existing single-family detached homes sold, has gone down by 24.1 percent in comparison to sales for the entire year 2005.

Another factor to consider is the growing inventory of available houses in certain counties in California, which is changing the market dynamics. What was once a sellers market is slowly turning into a buyers market.

Loan Defaults
This refers to the failure of homeowners to pay their monthly mortgage fees. One downside to this is that many Californian homeowners are choosing to have a bad credit report, rather than to keep paying fees for a home whose value has been inflated by as much as 20 percent more.

Foreclosure Sales
Figures presented by DataQuick Information Systems, a housing analyst company, indicate that foreclosure activities in California have gone up by 19 percent in the last quarter of 2005. This is an increase of 3 percent compared to the third quarter of 2005, and is 4.6 percent higher when compared to 2004's last quarter figures.

When foreclosure sales are on an upswing, consumer spending is down and consumer debt levels have risen. In the real estate market, this has meant that many financially strapped homeowners are selling their homes at lower prices. The other contributable factors are inflation, the rising prices of gasoline, federal budget deficit, and interest rates.

Concurrently, these key indicators confirm that although home sales levels in California are falling, the demand for houses remains strong and steady. Always do your due diligence before undertaking a purchase of property in California.

The Dow Jones Industrial Average: Failing the Average Investor

In addition to a well thought out Investment Plan, successful Equity investing requires a feel for what is going on in the real world that we all refer to as "The Market". To most investors, the DJIA provides all of the information they think they need, and they worship it mindlessly, thinking that this time tattered average has mystical predictive and analytic powers far beyond the scope of any other market number. A cursory review of New York Stock Exchange (NYSE) Issue Breadth figures (93% of the Dow stocks are traded there) clearly shows how the Dow has neither been prescient nor historically accurate with regard to broad market movements for the past eight years. Additionally, this financial icon that investors revere as the ultimate "Blue Chip" Stock Market Indicator has lost its luster, with less than half its members achieving S & P ratings of A or better, and 20% of the issues ranked below Investment Grade.

Is the 120-year-old DJIA impotent? No, it's certainly helpful for Peak-to-Peak analysis right now, for example, to see if your Large Cap only Equity Portfolio is as high as it was six years ago. But it's based upon a seriously flawed Buy and Hold investment strategy and universally used as a market barometer, when its original role was as an economic indicator. This is not just semantics. It's Wall Street's rendition of "The Emperor's New Clothes". Possibly, a weighted average of investor perceived business prospects for thirty major companies is a viable economic indicator, but leading or lagging? Clearly, there is no conceivable way that any existing average/index can measure the progress of the thousands of individual securities (and Mutual Funds masquerading as individual securities) that, in the real investment world, are "The Market". And is there just "a" Market, when REITs, Index ETFs, Equity CEFs, Income CEFs, and even some Preferreds are all mixed together in such a way that most brokerage firm statements can't quite distinguish one from the other? Investors are dealing with multiple markets of different types. Markets that don't follow the same rules or respond to the same changes in the same ways. The Dow is dead, long live reality.

Feeling statistically naked? Don't fret Nell, here are a few real market statistics and lists that are easy to understand, easy to put your cursor on, and useful in keeping you up to date on what's going on in the multiple Markets of today's Investment World:

1. Issue Breadth is the single most accurate barometer of what's going on in the markets on a daily basis! Statistics for each of the Stock Exchanges are tracked daily, documenting how many individual issues have advanced versus how many have declined. Rarely are these important numbers reported, especially if they are painting a picture different from that being jammed down investors' throats by institutional propaganda. Would you believe, that in 1999 (when the DJIA and other indices) last achieved All Time High (ATH) levels, monthly Issue Breadth on the NYSE was positive only in April, followed by a 12 month paper bloodbath extending through May of 2000. Since then, Breadth has been positive for six consecutive years. Surprise!

2. Pay close attention to the number of issues hitting New Fifty-Two Week Highs (52Hs) and Lows each day: a) for trend corroboration, and b) to obtain a wealth of important information for daily decision-making and periodic performance understanding. The recent NYSE Bull Market (not a typo) is clearly evidenced by six consecutive years (from 04/00) with more issues hitting new 52Hs than new 52Ls... New Highs nearly tripled New Lows. So much for the standard market tracking tools... not to mention Wall Street manipulation of all the news that's fit to print for investors. Looking at the daily lists of 52Hs and 52Ls will help you determine: a) which sectors are moving in which directions, b) if interest rate expectations are pointing up or down, c) which individual issues are approaching either your Buy or Sell targets and, d) which direction your portfolio Market Value should be moving.

In recent months, REITs, metals, and energy stocks dominated the hot list while regional banks, utilities, and other interest rate sensitive issues were notsos (sic). These lists always indicate what's going on now, without any weighting, charting, or hype, making your job almost simplistic. Take your reasonable profits in the issues that have risen to new peaks (Sell Higher), and purchase the quality issues among those that are at 52Ls (Buy Lower). High prices often reflect high speculation with Bazooka potential, while lower priced value stocks often turn out to be bargains. Ishares, foreign Closed End Funds, Mining and Energy bloat today's 52H List while preferred shares and Utilities occupy the 52Ls... a bit more meaningful than "the Dow is near an All Time High", and a bit scarier as well.

3. Throughout the trading day, periodic review of three lists called "Market Statistics" will keep you current on individual issue price movements, active issues, sector developments, and more. How you interpret and use this information will eventually affect your bottom line, weather you are a Value Stock Investor or a Small Cap day trader. The Most Active and The Most Declined Lists describe individual and group activity, identify where some more detailed research might be appropriate, and provide potential additions to your Daily Stock Watch List. The Most Active and Most Advanced Lists will identify the hottest individual issues and sectors, identify areas where news stories may be worth reading, and instantly make you aware of profit taking opportunities.

I know you are tempted to shout "Blasphemy" at the top of your lungs, but the DJIA was developed in a pre-internet world (actually, pre-automobile) where the statistics discussed above were unavailable, only the wealthy cared about the stock market, there were no Mutual Funds, and, frankly Scarlet, 95% of the population just didn't care. Now here's some blasphemy for you: It is likely that not one person reading this article has an investment portfolio that closely resembles the composition of the DJIA. It is just as likely that nearly everyone reading this article will use the Dow to evaluate portfolio performance. I've never understood this phenomenon, and I know that change takes time... but really, the Dow (and the other averages) have had their day, and far too much of your nest egg, for you to ignore this reality any longer.

The Sky Is Rising � Buy Stocks Low Now!

Back in 1998 I wrote an article warning people that the stock market was extremely overpriced. I was seeing obvious signs of idiocy in the stock market. The first big sign was a rampant hype of how great the big stock opportunity was in the popular press. I was seeing new investing shows pop up on TV. I was seeing young attractive women that look fresh out of am MBA program and dumb as dirt � CNBC's "Money Honey" Maria Baritomo on the floor of the NYSE gave a daily blow by blow account of how everyone in the public was going to get rich if they just bought in.

It all reminded my of Bernard Baruch's account of why he sold out at the top of the market in 1929. On his way to work he stopped to have his shoes polished. The shoeshine boy said, "Mister, let me tell you a bout a great stock I just bought� I ain't gonna be shining shoes for long." Baruch immediately went to his office and sold all of his stock. Later he told a reporter that when an inexperienced stock market idiot of a shoe shine boy is giving recommendations it is time to get out. In 1998 airline stewardesses were bragging about their stock buys and counting the days to quit their job.

Nothing could have been farther from the truth. The inside corporate executive controlled media firms were pumping investment sewage into the minds of the public. Why were they doing this? Because they had enormous holdings of employee optioned stocks that they needed to dump on the public. That is exactly what they did and public investors jumped onto the insider Punji stakes. In late 1999 and early 2000 just six months before the great stock market crash every time a greedy inexperienced idiot in the public bought into the great American rip off and bought stock an insider sold out for extraordinary profits. The vast majority of all inside corporate executives sold out their holdings on a stupid, greedy, public whipped into a buying frenzy buy the U.S. media that is controlled and operated from behind the scenes by large U.S. corporate insiders.

I just read an article in Business Week entitled "Blue Chip Blues." The article discusses the fact that the companies that comprise the S&P 100 have had a stellar 200%+ increase in earnings but share prices have increased less than one percent. This says that the public is not paying any attention whatsoever to the market. It is kind of like in high school where most of the kids paid attention to the cool kids even if they were stupid and wrong and can barely hold a job as adults.

We know in financial economics that the public is right in the middle of a major market move where all you have to do is buy and hold on tight � no brain required. The public is dumb as dirt at the bottom and the top of the market however. We are at the bottom right now. I know this because of the articles I am seeing about how much the stock market sucks right now. I was treated like Chicken Little in 1998 when I told everyone to get out as I ran around screaming "the sky is falling!" I was right. Now I am running around screaming the sky has crashed so buy, buy, buy! Yes folks right now is the time to buy and the sky is about to rise again. Chicken Little is always right in the end!

The beginners guide to safely join and use eBay

I don't think it matters where you are these days, if you mention the name ' eBay ', there is someone there who has either bought an item on it, or who has sold something on it, eBay has become a household name around the world. I started buying and selling on ebay around 7 years ago. There are thousands of people living in the U.S. that make full time living's selling item's on eBay, and thousands more that buy items on it daily.

eBay was started by one man named ' Pierre Omidyar '. When Pierre was 28 years old he started writing the programming code that was to become the internet site eBay. The site was launched online on Sep 4, 1995, ' Labor Day ' here in the U.S. At first it wasn't called eBay, but was named ' Auction Web '. Later it was changed to ' ebay ' , which was a short version of a consulting firm Pierre owned named ' Echo Bay '. eBay was free at the start, then it started charging fees to help cover it's internet costs for hosting and other charges. At the time, Pierre was dating a woman that collected PEZ toys, she used the new eBay site in its earliest incarnation to buy and sell rare dispensers. In 1996 Jeffrey Skoll, a Stanford MBA, joined the company and by 1998 eBay had gone public in the stock market, making Omidyar a billionaire. In 2005, Omidyar's 214 million eBay shares were worth around $8 billion. In March 1998, Meg Whitman was brought in as President and CEO of eBay where she serves still today

Let's start by going to the eBay site and joining. Just visit: www.ebay.com and you will be taken to the main page of the website. Once there look towards the top area of the screen and you will see text that says: ' Hello! Sign in or register. ', using the mouse button, click on ' register '. After clicking on ' register ' you will be taken to a screen with a form on it, enter the information about yourself, such as your name, address, telephone number and email address. Next you will be taken to another screen where you must choose a password and ebay user name, the eBay user-name is the ID or Name you will be known by to other ebay bidders and shoppers.

The password should be something that is not common, for instance do not use your first or last name, or some common word such as ' pencil ', or ' computer ', take your time and choose something difficult and a little long, make sure you write this password down and keep it near your computer in case you forget it. I recommend writing your ebay password on a yellow post-it note and hanging it someplace near your computer.

When your done with the username and password screen, you just have to check your email for the confirmation link that eBay sends you, just click on the link as shown in the email to activate your eBay account, now you have joined eBay, and you can start bidding and buying right away, but before you do let me tell you about the different features of eBay and how some things work.

eBay is not just an auction site, I mean you do not have to bid and wait for an auction to end, in order to purchase every item on eBay. In fact many items can be purchased for a set fee, and bought instantly, these are called ' Buy Now ' listings. For an example of how listings differ from each other, let's look at some ebay items. Let's say you and I are looking for a ' singing fish ', the fish that look like their mounted and displayed on a piece of wood, when someone gets near it, it will start singing and move it's mouth and tail, they are often called ' big mouth billy bass '.

To see if eBay has any of the ' singing fish ', we just go to the main ebay page (www.ebay.com) and in the 'SEARCH' area, type in: singing fish, and the screen shows there are currently 60 different items or listings found. I scroll down and select one of the listings, it currently shows the current bid price is $7.00 and it has had 4 bids, with 1 day and 13 hours remaining before the listing or auction ends. If I really wanted this item, and was willing to pay up to $15.00 for it, I would just click on ' Place Bid ', and enter my ebay username and password, if requested to do so. It tells me that I have to enter a bid of at least $7.50, remember I am willing to spend $15.00, so I would now enter $15.00 as my bid price. The item description page would then show that I am the current high bidder, and the amount needed to outpid me would be $8.00 or so, eBay keeps my maximum bid price ($15.00) secret, and automatically bids in increments for me as other folks bid, until reaching my $15.00 limit. If someone bids more than my $15.00 limit, there is no way I can win the item, unless I bid again and set another higher limit, if the item listing time ends with my $15.00 bid as the highest one, I am the winner.

The ' maximum bid ' option is a very neat feature, if you will be away from the computer and can not watch an auction closely while the time remaining is ending, eBay will automatically bid for you until you have reached your maximum bid limit.

Besides bidding, some items have others ways of purchasing them. Now lets go back to the screen that showed the 60 different listings for the ' singing fish ', I scroll down and notice that besides the current price of one fish, it says ' Buy It Now ' and shows a price of $8.99 near it. Clicking on this listing, I see the fish can be purchased instantly for $8.99, by clicking on the ' Buy It Now ' button. If I clicked on the ' Buy It Now ', button I would be taken to another screen where I would confirm that I want to buy it by clicking on the ' Commit to Buy ' button, or I could simply click 'back' on my web browser, or just go to another page to cancel my decision to buy the item. If I did click on the ' Commit to Buy ' button, it would show me other screens, and tell me where to send the payment, etc, all which are explained in simple and easy to understand terms.

There are three things to always check on before buying or bidding on an eBay item, the first is the sellers location. As you use ebay, you will see that some of the sellers live in Canada, or even the U.K. If you are like me and live here in the U.S. you may wish to just buy or bid on items that are here in the same country, to avoid a long delivery time, and large shipping fees. Each ebay item description page, tells the users address, for instance it will say ' Item location: Chatsworth, CA United States ', etc, near the top and middle area of the screen. Another thing to check is what the shipping costs will be. Some folks offer very high shipping, for instance someone may sell a shirt for only $2.00 but have a set shipping fee of $15, so always search the item description page before bidding and buying to find the shipping information. Some item description pages have a box, with a button on them called ' Calculate ', once you click on this button, just enter your zip code, and it will tell you what the exact shipping fees will be. One more thing to always check on is what methods the seller accepts as payment. Some folks only accept PayPal, others only accept Money Orders, or Checks, while some accept all methods. Look for this information on the item description screens also, it's listed usually under the item's description section, in an area called: ' Payment methods accepted ', all three of these things I have told you about, are easy to find and view on any item's description screen.

As you search and look at different items listed on eBay, you will see that a lot of people only accept PayPal as their form of payment. If you are not familiar with ' PayPal ' visit, www.paypal.com. Signing up and joining PayPal is simple and free, and it has great benefits especially for using eBay. PayPal payments are secure, and the money is sent instantly to the seller, it makes eBay a lot more fun to use, when buying items on eBay I use both PayPal payments and money orders.

Now let me just explain a little about ' feedback ' and how it's very important when it comes to buying and selling on ebay. Let's go back to the ebay webpage that shows the listings for the ' singing fish '. As I pick a listing at random, I look under the ' Seller Information ' area of that page, I see the sellers eBay name, and the Feedback Score. The feedback score tells you how many buy/sell transactions a user has made in the past on eBay, and the percentage of the transactions that were positive. This info is a great way to protect yourself from a seller or buyer that may not be very reputable. For example if you were interested in bidding or buying an item, and you noticed the person listing the item had a feedback number of 6 and a positive percentage of 20%, stay away from this person, but if the person had a feedback number of 6 and a positive percentage of 99% or so, they would be a lot safer to deal with.

Now before finishing this article I want to give you two more pointers or bits of information to use to make your eBay experiences good ones. Once you become familiar and can find your way around the different areas, go to your account screen, and find the option to change your password. My eBay password is over 14 characters long and contains letters and numbers in random order. I change my password every month or two, and I recommend you do this also.

The main reason I recommend you change your eBay password every month or two, is because there are a lot of nasty computer viruses and trojan horses floating around on the internet and arriving through email, and the purpose of some of these viruses is to scan your hard drive and seek out your passwords, ebay's included, and to email this info to hackers and other websites, giving folks you don't know access to your eBay account information.

In all of my years using eBay, I have never had one problem, and you should not either if you read and follow my advice and tips in this article, and just use some common sense or internet savy. There is no way I or anyone can guarantee you will never have trouble using ebay or any internet site, but neither can someone guarantee you won't become involved in a wreck while driving a vehicle.

There is a great FREE eBook that describes in detail how to ' How To Join eBay and PayPal - and Safely Use Each ', The eBook contains NO AdWare or SpyWare and is available for immediate download from this website address:

http://www.rb59.com/jepasut

By Robert W. Benjamin

Copyright � 2006

You may publish this article in your ezine, newsletter or on your web site as long as it is reprinted in its entirety and without modification except for formatting needs or grammar corrections.

The Third Step You Have to Take to Get Rich In the Stock Market!

This step is really important and most people just don't get it. Listen carefully � you have to deferred, avoid, and reduce capital gains taxes to the bare minimum! Well, how do I do that you ask? The best thing to do of course is to completely avoid capital gains taxes. The only way to do that is to open a Roth IRA. The reason you avoid capital gains taxes is that you pay your income taxes first and then you never pay taxes on any profits of the money you put into your Roth IRA.

If you make a lot of money though, you can't open a Roth. In that case you need to open a Standard IRA and of course if your company matches in a 401(k) you need contribute up to the matching. In a 401(k) make sure that you only buy a no-load indexed mutual fund. Get your accounts open! Get your accounts open! Get your accounts open! I can't overemphasize or shout this loud enough. Once you have your account open you will be motivated to start investing � if you don't know how to trade through such an account I can teach you.

Here is a key point if you trade in an individual trading account where you are subject to capital gains taxes. You have to remember that the short term capital gains tax is double the long term capital gains tax rate. That means that if you buy a stock now and then sell it in less than a year you will have to pay your regular income tax rate which is as high as 35%. On the other hand if you buy low and hold for the big multi year stock price raises your capital gains tax rate is only 15%. This is huge! Look, that means that you have to earn 20% just to overcome the hurdle when you buy and sell real fast like the get rich quick gurus want to teach you.

Get your accounts open. Here is a recap. First check to see if the company you work for offers a 401(k) plan with matching and contribute up to the matching. If you work for a university than open a 403(b) plan which can be even better than the 401(k). Restrict your investing in a 401(k) or 403(b) to no load indexed mutual funds. Second, if you can save more than the matching amount your employer offers then open a Roth IRA and contribute up to the maximum. Third, if you are a really hard core saver and investor like my wife and me open an individual trading account. Fourth, open your Roth and individual trading account at an online brokerage like Ameritrade.com or Etrade.com. This insures that you won't get an earful of manure from a stock broker who just wants to nickel and dime you out of your account. Also by trading online yourself you will learn to become a self sufficient investor � the richest kind of all!

The Second Step You Have to Take to Get Rich In the Stock Market!

The second step you have to take to get yourself moving forward financially is to learn to monitor your finances. Computers can really help us today if we let them. Put all of your bills on auto pay and scrutinize everything monthly looking for wasted expenditures. If you have a spend thrift in your life that won't stop them throw them off the train � divorce them or cut them out of the family. Over time you will know how much you can set aside to invest in the stock market.

That amount may start out very small. I was just talking last night with a 78 year old friend of mine who is a stock market millionaire. He told me that when he started working in the 1950s $250 was a lot of money to earn in a week. Stock sold then, just like it does today, for $10-$15 in solid companies � he worked for a solid company. He told me that he and his wife believed in the stock market and methodically and with great discipline saved and invested each week into the stock market.

At the time other company employees who did not save and invest had a lot more money to spend on finer cars and furnishings. My friend's wife was a little frustrated to see the Jones always ahead materially but her husband assured her that things would be different in the future. Sure enough they are stock market millionaires now.

I asked my friend what advice he would give you. He said that it is imperative to just get started saving and investing in you retirement plan at work up to the matching. If you have extra money open a Roth and if you have more than that then the minimum Roth contribution open a individual trading account. The main thing he wanted you to know is that you have to get started no matter how small it is. If you don't you will never get ahead.

The First Step You Have to Take to Get Rich In the Stock Market!

I am widely recognized as a leading expert in the stock market and especially at teaching you how to become your neighbor's millionaire next door. I didn't start out as knowledgeable and skilled as I am now. I started out knowing nearly nothing. I was so inexperienced in my early twenties that I could only stand by when a full service stock broker stole $85,000 from my eighty year old grandmother. I watched the nationwide stock brokerage protect the interests of the full service broker and my grandmother lost everything.

The pain of this was so intense that it drove me to complete my Ph.D. in finance � less than a hundred of us graduate in this degree worldwide annually because it is so mathematically difficult. My frustration and anger at the big rich forces behind Wall Street drove me to become a modern day master of money. This is what you have to do � wake up!!! Wake up to the fact that you can make it as a stock investor. Wake up to the fact that you control your destiny and that you can stop handing all of the control over to the Wall Street machine that could absolutely care less about your financial future. This is the first step � take full responsibility for you earnings, savings and investment.


I learned years ago from a friend of mine, Dr. Van Tharp, Ph.D., that if I didn't take full responsibility for my investing that I would never progress � I would simply break the fragile feedback loop that allows all of us to learn from our mistakes. Any time you blame anyone for a financial mistake you destroy the opportunity to learn and thrive from the situation. The simple decision you must make is to deeply, totally, firmly, and finally, say to your self, "I am the master of my universe � I am in control � Wall Street has no power over my mind" is the key critical change you must make in your thinking.

Some people will think that you are arrogant but just blow them off and laugh all the way to the bank. Stop listening to people � are these nosy little bug a bugs in your life that so quickly nay say your investment dreams paying your bills or giving you money to move ahead � no so blow them off! They just want to give you bad advice so that you fall into their same financial loser traps. In terms of investing become an island unto yourself and very carefully cultivate relationships with people who really do know what they are doing in investing. This is exactly what I did. I started seeking out people who really understand the markets. I found them over time and I asked them lots of questions.

The 1% rule � Stock Market Insiders Are Richer than European Royalty!

I was watching Oprah the other night. She was covering the reality of the crappy lie called the American Dream that says just work hard and everything will be Peachey keen in the land of the free and the home of the brave. She pointed out that 1% of the U.S. population now control 40% of the all American wealth. If you are not born into that 1% today, she pointed out, then it is much harder today to work your way into it. You have to work a lot more hours for a lot less pay and your extra hours are just making the 1% richer. Meanwhile if you have the right connections � especially if you are able to enter that special band of thieves called corporate insiders and play your corporate politics right � then you are instantly propelled to the top. Today with our hideously corrupt corporate governance system supported by divisions of corporate attorneys serving insiders and paid by unwitting public Joe shareholders membership pops you right into Oprah's 1%.

So what can you do if you weren't born into the Johnson & Johnson family and don't have a "richer than God" old money American dream trust fund? The answer is you have to learn to buy very low and sell very high like the robber barons did in the 1800s. I know times are tough on the American middle class but there are ways for you to get ahead. First of all you have to stop chasing pipe dreams. Ignore the get rich schemes like multilevel marketing, derivatives, and real estate short selling junk people will bring your way � all endorsed by some major public figure that make the con artist at the top rich to suck you in.

Learn to take your financial future in your own to hands and make the market pay you. How do you do this? Well, first you have to stop thinking like a cow. Most people in the public make all of their opinions based on what the group has decided is right. You have to stop doing this and take the attitude that the public as a group is a pretty stupid mass of livestock heading up the cattle chute into the inside corporate executives financial slaughter house. Right now the chute is closed because the stock market has recently crashed making stocks cheap �insiders are loading up while the media is strangely bereft of "stock market rags to riches dreams" it hyped up to suck people in to the market in 2000 when insiders were dumping on the public.

Learn to get really excited about the market when everyone hates it. Right now the stock market has crashed and you don't hear any good news out there. Ever wonder why? The big forces behind Wall Street, the secret buying consortiums, the inside corporate executives, and the experienced individual investors who are smart enough to know to buy, buy, buy when stock prices are extremely low and the Wall Street media machine is strangely quiet. There are a lot of really good companies out there at extremely low prices ripe for you to buy, buy, buy!!!

Should I Incorporate Fundamental Analysis When Trading a System?

There's a common misconception about "Fundamental Analysis": People tend to think that the market should react in a certain way to news. Example: "Unemployment Rate goes down", which means that the economy is doing better, therefore companies should make more profits and stock prices will move up. Conclusion: If the unemployment report is positive, the market moves up.

But in reality the markets are driven by greed and fear, and not by supply and demand or anything like this. A report itself is meaningless: It's the traders reaction to the report that moves the market.

Here's a perfect example: On Friday, April 7th 2006 the unemployment rate for March was published. The market expected an unemployment rate of 4.8%, and the numbers came in better than expected: Only 4.7% (for details see http://biz.yahoo.com/c/ec/200614.html). That's good news, isn't it? The market should move up, right?

WRONG! On that day the e-mini S&P dropped 20 points. Why?

Well. here are some comments I got from a news-service:

"Not surprisingly, Friday's equity trade was dictated by the March employment report. More specifically, it was the Treasury market's reaction to it that set the stage for stocks." ...
"A lack of negative surprise caused the stock market to breathe a sigh of relief."...
"The Treasury market had a very divergent reaction to the data, and it took the stock market down with it. For Treasury traders, the in-line data essentially provided no evidence that the Fed will be inclined to soon end its monetary tightening cycle."

Oups. So the stock traders thought it's good news and the market was moving up, but the treasury trader in the other room thought it's bad data. So treasury instruments were rallying, causing the stock market to drop like a rock. But don't stocks lead the treasuries? Or do treasuries lead stocks? ...

As I am writing these lines another news hits the ticker: Oil prices trading above $69 per barrel. But what does it mean? Should the stock market move up or down? Here's a discussion that I heard this morning: "As crude oil prices continue to plug higher the debate over what it all really means will begin again. The questions that will be batted back & forth are "Are sky-high oil prices indicative of a coming economic slowdown or looming inflation?" And more important: How will the Fed react? Will they cease increasing interest rates or even lower the rates again? This would provide a boost for the stock market. Or will traders fear that there's an economic slowdown which might result in lower company earnings? This would move the market down.

As you can see, it's not the news that move the market; it's the reaction of the traders to news that let prices jump up and down.

Now, how should a computer model take these emotions into consideration?
In my opinion there's no way, and I haven't seen any models (incl. artificial intelligence) that is coming somewhat close to this (sometimes really weird) human behavior.

That's why I for one don't incorporate Fundamental Analysis into my trading systems.

The Sky Is Rising � Buy Stocks Low Now!

Back in 1998 I wrote an article warning people that the stock market was extremely overpriced. I was seeing obvious signs of idiocy in the stock market. The first big sign was a rampant hype of how great the big stock opportunity was in the popular press. I was seeing new investing shows pop up on TV. I was seeing young attractive women that look fresh out of am MBA program and dumb as dirt � CNBC's "Money Honey" Maria Baritomo on the floor of the NYSE gave a daily blow by blow account of how everyone in the public was going to get rich if they just bought in.

It all reminded my of Bernard Baruch's account of why he sold out at the top of the market in 1929. On his way to work he stopped to have his shoes polished. The shoeshine boy said, "Mister, let me tell you a bout a great stock I just bought� I ain't gonna be shining shoes for long." Baruch immediately went to his office and sold all of his stock. Later he told a reporter that when an inexperienced stock market idiot of a shoe shine boy is giving recommendations it is time to get out. In 1998 airline stewardesses were bragging about their stock buys and counting the days to quit their job.

Nothing could have been farther from the truth. The inside corporate executive controlled media firms were pumping investment sewage into the minds of the public. Why were they doing this? Because they had enormous holdings of employee optioned stocks that they needed to dump on the public. That is exactly what they did and public investors jumped onto the insider Punji stakes. In late 1999 and early 2000 just six months before the great stock market crash every time a greedy inexperienced idiot in the public bought into the great American rip off and bought stock an insider sold out for extraordinary profits. The vast majority of all inside corporate executives sold out their holdings on a stupid, greedy, public whipped into a buying frenzy buy the U.S. media that is controlled and operated from behind the scenes by large U.S. corporate insiders.

I just read an article in Business Week entitled "Blue Chip Blues." The article discusses the fact that the companies that comprise the S&P 100 have had a stellar 200%+ increase in earnings but share prices have increased less than one percent. This says that the public is not paying any attention whatsoever to the market. It is kind of like in high school where most of the kids paid attention to the cool kids even if they were stupid and wrong and can barely hold a job as adults.

We know in financial economics that the public is right in the middle of a major market move where all you have to do is buy and hold on tight � no brain required. The public is dumb as dirt at the bottom and the top of the market however. We are at the bottom right now. I know this because of the articles I am seeing about how much the stock market sucks right now. I was treated like Chicken Little in 1998 when I told everyone to get out as I ran around screaming "the sky is falling!" I was right. Now I am running around screaming the sky has crashed so buy, buy, buy! Yes folks right now is the time to buy and the sky is about to rise again. Chicken Little is always right in the end!

Tattle Tale

When I was in grade three I had this odious teacher that hated kids who squealed on other kids, regardless of the issue. It didn't matter if you complained about someone stealing an eraser, cheating on a test, taking your lunch money, or socking you in the mouth...she didn't want to have to deal with it. To her, integrity was found in silence.
If you were affronted by a fellow student and happened to mention it to her, she would respond by a) disregarding you, and b) pinning a long donkey's tail fashioned out of construction on your behind with the words "tattle tail" emblazoned on it.(you had to wear it for the remainder of the day). I tried to make it look fashionable


Personally, I'd like to think that the lessons we learned in elementary school help us out later on in life. If so, I'm certainly glad that Sherron S. Watkins wasn't in my class.
As you may, or may not know, Sherron S. Watkins was the Vice President of Corporate Development at Enron who told then CEO Ken Lay in a now-famous August 2001 memo that financial fraud could destroy the energy trading firm. She said his response was to launch a "bogus" probe and try to have her fired.

It was less than four months before Enron collapsed into bankruptcy at a cost of thousands of jobs and billions of dollars of stock-market wealth.

Enron's downfall sparked a federal investigation that resulted in the multiple fraud and conspiracy charges for which Lay, 63, and Skilling, 52, are now on trial. The two face decades in prison if convicted.


Did anything positive come out of the Enron debacle? I think we can finger two silvery-gray lined clouds. First, it's all about integrity. Ordinary people matter. Determination matters. Honesty matters. Diligence matters. There is a place for Truth.
Secondly...the Sarbanes-Oxley Act. The Sarbane Oxley Act of 2002 is considered to be one of the most significant changes to federal securities law. It came in the wake of a series of corporate financial scandals, including those affecting Enron, Arthur Andersen, and WorldCom.

Among the major provisions of the act are: criminal and civil penalties for securities violations, auditor independence / certification of internal audit work by external auditors and increased disclosure regarding executive compensation, insider trading and financial statements.

In the world of publicly traded companies, there is a lot at stake. Not only are the companies responsible for their staff, clients, partners, and customers, they're also responsible to the every-day, well intentioned, share holder who has chosen, rightly or wrongly, to believe that what the company says is true...is actually True.

We need to be able to trust the people in charge. Whenever a company does something noteworthy, the CEO is often the first one to step into the limelight and take the credit along with a big fat bonus. (Lay raked in $150 million in income, bonuses and stock packages. He still sleeps soundly every night in one of his several mansions.) But, when things are bleak, some CEO's seem to disappear into a world of meetings.


Integrity, honor and truthfulness aren't just virtues meant for the third grade. They're qualities for life...and what a better place the stock market (and society at large) would be if everyone lived these virtues more often.
While the stock market is still full of inherent risks...it may be just a little safer than it use to be. So hats off to Whistle Blowers like Sherron S. Watkins...and leave the donkey tails at home.

Read more investments and penny stocks
at www.peterleeds.com

Introduction and Overview of Forex Trading

Forex involves the trading of currencies. It is the largest financial market in the world and has an estimated daily turnover of 1.9 trillion dollars. This turnover is larger than all the worlds' stock market on any given day.

The forex market does not have a fixed exchange. The forex market is considered an over-the-counter (OTC) market. The forex market is completely electronic and trades are executed over the phone or on the Internet. Until 10 years ago the forex market was the preserve of large financial institutions. Now an ever-increasing amount of individual traders thanks to the advent of the Internet and an increasing amount of online forex brokers are trading forex.

Currencies are always traded in pairs. A typical pair would be EUR/USD (Euro over US dollars). The first currency is the base. The second currency is the counter currency. The pair can be viewed, as the amount of the secondary currency that is needed to buy 1 unit of the first currency. If you were to buy the above pair you would buy Euro and simultaneously selling US dollars. If the pair were sold the reverse would happen you would sell the Euro and buy the US dollar. This might sound confusing but simply think of the pair as one item and you are buying or selling one item. If you think the Euro will go up against the US dollar you buy the EUR/USD pair. If you think the EUR will decrease against the US dollar you sell the EUR/USD pair.

When you see forex quotes you will see two numbers. If we use the EUR/USD as an example you might see 1.2350/1.2355 the first number 1.2350 is the bid price and is the price traders are prepared to buy euros against the US dollar. The second number 1.2355 is the offer price and is the price traders are prepared to sell the EURO against the US dollar. The difference between the bid and the offer price is the called the spread. The spread for the major currencies is usually 3 to 5 pips (explained later).

The most common increment of currencies is the pip. If the EUR/USD moves from 1.2350 to 1.2351 that is one pip. A pip is the last decimal point of quotation. Most currencies are quoted to 4 decimal points. The exception is the Yen, which is quoted to 2 decimal points eg 139.41. The term pip is just forex lingo so if a forex trader says the EURO has gone up 20 pips against the US dollar add 0.0020 to decimal part of EUR/USD pair.

Forex is traditionally traded in lots also referred to as contracts. The standard size for a lot is $100,000. In the last few years a mini lot size of 10,000 dollars has been introduced and this has become increasing popular. Forex trading is leveraged with most forex brokers offering 1% margins. This means you can control one standard lot of $100000 with $1000. Typically you would need a minium of $2500 to open a standard size forex account.

A mini account can be opened with $300 with most forex brokers. To trade a one mini lot you need a margin of $100, which in turn controls $10000 of currency. If the currency goes up 1% and if you traded one mini lot of $10000 you would make $100 dollars or 100% of your original margin. Forex trading is a very lucrative market to get into and it is suggested that traders new to forex trading trade a mini account for an extended amount of time. Trading a mini account is a low cost entry to the forex market, as only $300 is required to open an account. You can still make money while you become more experienced in forex trading. You can trade one mini lot until you have made your first $100 dollars then start trading 2 mini lots. As you gain more experience you can trade standard sized lots.

Forex trading is becoming increasing popular with traders of other financial products. It can be traded in amounts a lot smaller than other financial products, which makes learning forex trading safer than other markets. Forex trading can be a very lucrative market, which no trader can dismiss.

How to buy brand name guitars on the cheap

Music buffs and specifically guitar lovers are always seeking best prices on both new and used guitars. Especially prevalent

since the movement of guitars is pretty fluid, evidenced by the large number of guitar stores found in any mid-size town in

America. Guitarists are forever upgrading or enhancing - and yes sometimes even downsizing or simply giving up! - there

musical instruments.
There is a web site (link below) which lists some of the finest brand name guitars and monitors there pricing on a minute by

minute basis. The best place to find a huge guitar market in undoubtedly eBay. So this listing is made up by polling eBay on

a regular continuous basis, and collecting some vital 'insider' statistics that can help you make much more informed buys.
With a large volume of guitars being traded everyday, this is the ideal near efficient market. One can study the dynamics of

this micro-market and determine some useful buying rules. With a little more information than the rest of the marketplace,

one can almost certainly make some intelligent buying opportunities. This article focuses on how to identify these gaps and

often purchase brand name guitars for nearly 50% below retail.
This article should be read together with my longer piece and a web site, which produces the information required to identify

buying nuggets. Find the links and URLs to these two sites at the bottom of this article. Here is a small sample of some of

the brands it searches each day;
Hamer Guitars, Ibanez, Italia Guitars, Jackson, Johnson Musical Instruments, Kramer, Line 6, Michael Kelly, OLP Guitars,

Parker Guitar.
There is one more aspect that makes this site useful. That is it holds information that is often more difficult for the buyer

to obtain. With this information in hand buyers can often make more informed and better decisions and therefore avoid bidding

wars and outsmart other bidders to a high degree.
Most information on eBay focuses on the selling element, i.e. how to sell your guitar. I have tended to specialize on the

buying end and trying to identify market opportunities and price in-efficiencies to really capture excellent deals. To do

this we need to understand the dynamics of the eBay market place. Like any other market it is supply demand driven, and like

a large flee-market if a buyer has knowledge of how many items are for sale at what prices and how many other buyers are in

the market, then that buyer can capture the upper hand. Lets focus a little more on supply.
The eBay supply dynamic is a little different in that supply of an item must be seen at a point in time. In other words,

because auctions end at different times, one needs to grasp the number of auctions ending in close proximity for the same

item. This gives you a feel for the supply of items or in our case cameras. What makes this interesting is that today there

could be a large amount of auctions ending for a particular model, but next week there could be very few. This is one element

driving the price.
The demand side is slightly more complex and hidden from the average eBay buyer. This is where that the web site I refer to

at below has some useful data. Demand in eBay terms is measured (by sellers) as a number of factors - how many people view my

auction, how many people ask questions, how many people place me on their watch page, and how many people actually bid.

Obviously as we progress down this list the data become more reliable as an indication of demand. Page views are not easy to

obtain, although some sellers place a publicly viewable counter on their auction pages. Questions and watchers are available

to sellers, and the special web site mentioned below will expose this information. Number of bids is available for all to

see.
Now if we happened to produce a graph as the auction progresses of the changes in the number of questions, watchers and bids

one can easily see how the demand is changing as time progresses. Typically if questions are high and watchers are high, but

bids are low, this may indicate some confusion (for example a spelling mistake in a model number) and a possible buy

opportunity. If watchers are very high and climbing, but bids are low, this can point to a last minute bidding war, and a

stay out indicator.
Armed with this information and also a quick summary of other similar auctions ending soon, plus a quick feel for the skill

set of the seller and the current highest bidder, one can see a picture very different from the average eBay buyer. Soon the

trained eye will observe some nice buying opportunities. Guitar musicians, relish the opportunity to get a one up on our fellow buyers. Look carefully at the data presented, after a

little practice opportunities will leap out at you. The premise is simple, a buyer with more market information will always

pay lower prices than the rest of the market. In stock market terms it caller insider trading, and its illegal. In our case

its quite above board and simply assists you in better understanding the supply demand curve for that BC Rich Floyd Rose

http://brandnameguitarbargains.com/eb/BC-Rich/ for your next gig.

Resources;
How to buy brand name guitars at a

discount
Brand name guitar bargains listings

Trading Software - Profit Machines or Losers?

Thousands of people every day trade on the worlds stock markets, with the majority now using software to aid them, but does it help them make more money?

This software is known as a �bot', short for robot, but it is only ever as good as the user. If the user does not know how to trade successfully on his own in the first place then he is unlikely to get instant profit from a bot. New users have to understand that it will take weeks to learn how to use a bot correctly.

I use the �new' bots on the block on a daily basis. Any professional trader should at least be aware of the existence of betting exchanges, and the fact they can turn over $Millions per horse race within a few minutes, and with the betting exchange allowing you to back (buy), and lay (sell) a horses odds, many new traders are springing up to take advantage of this with the use of betting bots. And the best thing is, you do not need any knowledge of the sport you are trading in. You can also trade on the majority of the worlds financial markets, such as the FTSE, NASDQ, etc, as well as currencies.

So are these new bots a license to print money? Depending on which one you use, as some are useless, and will see you lose money faster than if you were using a pin, but others stand out, and are put together by professional stock market traders. It is these bots that have the potential to make you money, and if handled correctly, plenty of it.

Most of the bots on sale focus on one aspect, whether it is trading, arbing, hedging or dutching, but there are a small number that focus on them all, and compared to the single function bots, are much better value for money. These multi-function bots allow you to find your niche in a competitive market, without emptying your bank balance.

It is also a misconception that you will start making a lot of money instantly. Even if the bot produced profits on a daily basis (which by the way, will never happen), you still have to limit trades to a fixed percentage of your betting bank, otherwise you will find yourself having no control over trading stakes. It is always best to start small, get the mistakes out of the way while it is cheap to do so, and when your stakes increase, you will have learnt enough from your mistakes to save money.

Some people click with trading straight away, others it can take weeks of staring at the graphs on the screen until the penny drops. Those that stick with it though, usually succeed, and a bot makes life so much easier.

So if you have the capabilities to profit from trading, then a betting bot may be for you, if you are looking for a quick buck, forget it.

The Trading Teacher

When I studied the principles of investing in university, I was taught that the price of a share reflected the value of the company. With fundamental analysis, there are many methods on how one can analyse the financial statements of companies to find out whether a share is a good or a bad investment. You can conduct horizontal and vertical analyses on standardised financial statements, which are just fancy terms for comparing numbers. You can calculate certain financial ratios to get a better understanding of a company's liquidity, working capital management, its ability to remain in business over the long term, and its profitability.

I applied these concepts when I started trading the stock market. Soon I found that if I wanted to trade shares in a timeframe of less than three months, decisions based on these analyses were not useful. I did not want to buy shares only to receive dividends. I wanted to trade for capital gains.

I was dissatisfied with my knowledge, the tools and the methods that I had to trade the markets. With my desire to trade a timeframe shorter than three months and my strengthening belief that emotions greatly impact on trading, I began to search for different approaches to buying and selling shares.

I went back to one of my textbooks in university. I wanted to know how else I could analyse the markets. From the passage I read, I learned that one can analyse the markets in one of two ways: fundamental analysis and technical analysis.

I bumped into a newspaper ad one day for a trading seminar. While reading through the ad I saw the words: technical analysis. An expert trader was going to speak on the exact topic I was interested in learning. It was a free seminar and everybody was welcome to come along. So I called a friend of mine and I asked if he would be interested in attending this trading seminar. He was.

The seminar was organised by a business selling trading courses: courses to instruct people on how to trade the share market. When we arrived, we were led into a small room. There were about thirty people. The spokesman was apparently a veteran trader who wrote two books on trading. Let's call him Bauer for the purpose of this article. Bauer had a very strong presence. He was a huge, tall man with a clean-shaven head.

I was on the front row seat trying to listen and understand every word this man said. It was his teachings that planted the seeds of how I eventually grew as a trader over the years. Many times, I heard his voice in my head, reminding me of the lessons I learnt from his books and the lessons I learnt from him that day. I will try to enumerate the lessons I learnt from this man to help you the way they helped me.

This man had my attention from the very beginning. "The share market is a game where people try to steal money from other people. That is the objective of the game and it is legal", he began. I wondered what the professionals in Wall Street would have thought about that statement if they heard it. I smiled. I liked him already.

He continued: "If you are going to join this game, you are essentially given permission to steal money from other people and in exchange, you are okay with them stealing your money also. Some of the brightest people in the world will be playing with you. Therefore, if you are going to war and fight an army with real weapons, you better make sure you do not go there with a plastic gun."

He said that people rush to the markets to lose their money. It sounded laughable but I guess it was the only conclusion one can draw from the fact that most people begin trading without sufficiently preparing and educating themselves. Of course, most of us do not put on a trade with the hope of losing our money; however, that is what we are effectively doing when we trade without adequate preparation.

"They just cannot wait to lose their money. They do not bother learning about the market first. They think it is easy. Most people know that they need training before they can fly a plane or perform surgery, but I do not know why they think it is easy to make money trading", he exclaimed. He was quite emotional about it.

"Trading is hard", he declared. Only about 5% of people know how to trade profitably. And so the probability of finding someone else who knows what they are doing is very, very small. "Do not rely solely on the advice of your brokers, your fund managers or whoever else. Your best hope for success is to educate yourself. The sooner you do that, the better off you'll be."

"When it comes to buying and selling shares, there is no such thing as investing. What people normally refer to as investing means long-term trading to me". When people hold on to their investments for five or more years with the intention to sell later, then all they are effectively doing is trading�just with a longer time frame.

"Do not buy shares solely for the dividend payments. They offer you measly rewards", he said. "Do trade only with the purpose of making money from capital gains. Buy low, sell high and that's how you should make your profit."

At the time, I was juggling between the concepts of short-term trading or investing for the long-term. I did not know whether I was taking the right approach by attempting to make short-term profits. He made his stance on the matter strongly.

He asked us if we knew what drove prices up or down. Remembering what my lecturer said in university, I responded, "the price moves up and down close to the intrinsic value of the share".

He turned his attention to me and asked, "What share are you trading?"

"XYZ (I changed the name for the purpose of this article)", I replied quite happily. Perhaps I could squeeze a tip or two from him about the stock.

"Do you know what the intrinsic value of XYZ Company is", he asked.

I nodded my head sideways and muttered, "no".

"I'll tell you what the value of XYZ is� it is zero!" He barked.

I was taken aback by his response. Zero? Then what are we paying money for when we buy a share? I thought. Then he clarified himself.

"Price is only a perception � it is people's perception of what they think the value of the share price is".

"The key to success in trading is psychology", he continued. Psychology? I thought. How did psychology get involved in this? "The stock market is like an opinion poll. It is a measure of what people think is going to happen. If they think the price will go up, you will see an upward movement on the chart because there are more buyers so the sellers increase their price because some of these buyers are willing to buy at higher prices", he explained.

He then used an example to explain a typical trader's behaviour when he trades without a system. As he explained it, I recognised my own behaviour in his demonstration.

This was all a revelation for me. When I was buying and selling shares I wondered what type of people were on the other side of the trade because collectively, they were pretty smart. Now I know. It was people like Bauer who were on the other side of those transactions, doing the exact opposite of what I was doing, using similar methods like the ones he was using. They were looking at the share market with a philosophy and an approach that were completely alien to me. Traders like him were making all the money and traders like me were losing.

I shook my head in disbelief that other people saw things the way they did. I felt excited knowing that there was another alternative, another approach in analysing the markets.

"What you need, is to develop your own trading system." He exclaimed to everybody in the entire room. "Without a trading system, you will fail. I guarantee you. This trading system must be something that is suited for you and you only. Even if I give you my trading system I am certain that you will fail to make money, because my system is not designed for you. It is designed for me. That is why you need to learn how to use the tools and acquire the skills needed to be a trader".

I accepted his advice without fully understanding this concept of matching a trading system to suit the trader's own personality. It lingered in my mind for a long time. The wisdom of his advice became apparent to me as I slowly learnt more about the nature of trading.

Bauer diverted our attention to the charts on the screen projected from his laptop. All I saw were lines, curves, rectangular boxes and more squiggly lines. The tools of a professional trader: I thought. I was being shown the tools that my market �adversaries' have been using to �clobber' me with all this time. My heart was beating faster than usual. I was in awe. I wanted those tools.

I asked Bauer what program he used to analyse the markets. He told me. I also asked him how many indicators he used. I had read enough about technical analysis by that time to know that technical analysts use indicators to analyse share prices. There are many indicators to choose from so I wanted to know how many of those are used by professional traders. He started counting his fingers. �Seven', he said.

I think many people there had not really read up on technical analysis but I had done my homework and by that time, I was pretty much the only person in dialog with him, asking him questions. I wanted to gain as much knowledge and wisdom he was willing to give me.

Then I heard one of the most important lessons I've learnt which minimised my losses during my early years of trading: "Trade so small that it is almost a waste of your time. Assume the next trade is going to be the first out of a thousand trades you are going to be making in your life. Even though your profits are smaller, your losses are smaller too. There is no need to rush. Do not worry about getting rich too quickly."

He was suggesting that novices like me should trade using small position sizes. That means to buy small number of shares at the start. I was intrigued. I did not know a person should trade that �small'.

Eventually, the seminar ended. I grabbed the booklets and brochures given out by some of the staff. In one of these brochures was the name of the program he uses. They were selling the software with the courses they were offering. I could not afford the entire package but I knew I had to buy the same charting software Bauer used. I decided to learn as much as I could about how to use charts and graphs to analyse the market. I needed to develop my own trading system.

As for my friend, he said he had a car loan to take care of first. He would look into trading shares later when he had a little more money to set aside.

A couple of days later, I got a call from the organiser of the seminar, telling me that based from the questions I had been asking that night, I was the type of person that would most benefit from their education package. Bauer was asked to demonstrate the need for trading education because he traded the markets. In the process, he was selling the courses well. Bauer seemed knowledgeable and experienced. He has enlightened me and probably several other people in that room about how much there was to learn. I was sold. I just could not afford the courses at the time but I wanted them so badly that I asked the sales person on the other end of the line if I could work for them in exchange for the course.

I did not get to do the course but I bought the software from a different distributor at a cheaper price. I also bought the two books Bauer wrote. I figured that I could acquire the skills and wisdom through self-education. I learnt a lot from those two books and from using the software. Having that opportunity to attend that seminar was a �gift from the heavens', as far as I was concerned. Wherever you are, Bauer, I thank you. You � and others like you -- have made me recognize the value of passing on knowledge and experience for others to follow.


- END OF ARTICLE -

Please activate all hyperlinks and include the paragraph below if you are republishing this article online or in print.

How to buy brand name gadgets for bargains on the dollar

Don't you love gadgets, especially the new finagled ones. If you are like me

and you strive to take ownership of the latest and greatest, then this article

is for you - because I will save you a bunch of money which can then be safely

applied to ... even more gadgets. From satellite receivers to universal

remotes, there is a constant barrage of new releases. Now any self respecting

gadget addict will understand that yesterdays gizmo's is destined for the trash

heap as soon as release 3.0 hits the streets.

Of course for the savvy shopper release 2.0 offers unique buying opportunities.

Purchasing the one generation before often yields even more fun and

stimulation. Since bugs have been removed, geeky hacks have been introduced and

generally you can have more fun and be rather more ruthless with the little

device.

Now a market exists for both state of the generation and one, two and even

three back versions. Its eBay of course that I am referring too. With a large

volume of most electronics being traded everyday, this is the ideal near

efficient market. One can study the dynamics of this micro-market and determine

some useful buying rules. With a little more information than the rest of the

marketplace, one can almost certainly make some intelligent buying

opportunities. This article focuses on how to identify these gaps and often

purchase many electronic gadgets for 20-100% below retail.

This article should be read together with my longer piece and a web site, which

produces the information required to identify buying nuggets. Find the links

and URLs to these two sites at the bottom of this article. There exists a

little web site that polls data from eBay throughout the day. Now what makes

this different you may ask? Well firstly it only focuses on well know in demand

electronic gadgets. On the left panel you will find categories for things like

Wide screen Notebooks, Digital Cameras, Simple Surround Sound, XBOX 360, Apple

iPOod Tunes Video, HDTV, ESPN Phone, etc. etc.

There is one more aspect that makes this site useful. That is it holds

information that is often more difficult for the buyer to obtain. With this

information in hand buyers can often make more informed and better decisions

and therefore avoid bidding wars and outsmart other bidders to a high degree.

Most information on eBay focuses on the selling element, i.e. how to sell your

clubs. I have tended to specialize on the buying end and trying to identify

market opportunities and price in-efficiencies to really capture excellent

deals. To do this we need to understand the dynamics of the eBay market place.

Like any other market it is supply demand driven, and like a large flee-market

if a buyer has knowledge of how many items are for sale at what prices and how

many other buyers are in the market, then that buyer can capture the upper

hand. Lets focus a little more on supply.

The eBay supply dynamic is a little different in that supply of an item must be

seen at a point in time. In other words, because auctions end at different

times, one needs to grasp the number of auctions ending in close proximity for

the same item. This gives you a feel for the supply of items or in our case

cameras. What makes this interesting is that today there could be a large

amount of auctions ending for a particular model, but next week there could be

very few. This is one element driving the price.

The demand side is slightly more complex and hidden from the average eBay

buyer. This is where that the web site I refer to at below has some useful

data. Demand in eBay terms is measured (by sellers) as a number of factors -

how many people view my auction, how many people ask questions, how many people

place me on their watch page, and how many people actually bid. Obviously as we

progress down this list the data become more reliable as an indication of

demand. Page views are not easy to obtain, although some sellers place a

publicly viewable counter on their auction pages. Questions and watchers are

available to sellers, and the special web site mentioned below will expose this

information. Number of bids is available for all to see.

Now if we happened to produce a graph as the auction progresses of the changes

in the number of questions, watchers and bids one can easily see how the demand

is changing as time progresses. Typically if questions are high and watchers

are high, but bids are low, this may indicate some confusion (for example a

spelling mistake in a model number) and a possible buy opportunity. If watchers

are very high and climbing, but bids are low, this can point to a last minute

bidding war, and a stay out indicator.

Armed with this information and also a quick summary of other similar auctions

ending soon, plus a quick feel for the skill set of the seller and the current

highest bidder, one can see a picture very different from the average eBay

buyer. Soon the trained eye will observe some nice buying opportunities.

Electronics gadget nut cases like me, relish the opportunity to get a one up on

our fellow buyers. Look carefully at the data presented, after a little

practice opportunities will leap out at you. The premise is simple, a buyer

with more market information will always pay lower prices than the rest of the

market. In stock market terms it caller insider trading, and its illegal. In

our case its quite above board and simply assists you in better understanding

the supply demand curve for that yummy flat panel TV you had you eye on last

Christmas.

Resources;

How to buy electronics

gadgets at a discount
Brand name gadget bargains

listings

An Investor's View of The Fair Tax: A Resolution

The vast majority of Americans are investors, although many don't realize it. The vast majority of Americans are creative with their 1040 numbers, although most won't admit it. The majority of Americans would agree that investing, retirement planning, and estate preservation would be easier to manage if the Internal Revenue Code was comprehensible. A landslide of American voters would elect any candidate championing IRC replacement surgery.


All of us aspire to some degree of economic security and none of us would be so critical of the wealthy if we had a shot at joining their ranks. One side of the legislative mouth encourages savings and investment while the other treats it with totally "unearned" disrespect. One wealthy political party wants us to hate anyone with indoor plumbing while the other (wealthier) one spends most of its time trying to protect its diminishing turf and powerful cronies. All levels of government view businesses small and large as their all-purpose Reserve Accounts and, as a result, both prices and taxes suffer from a terminal case of "downward stickiness". Not surprisingly, in a DC crowded with 10,000 combative fiefdoms, nowhere can a PhD in dot connecting be found. We can change this!


It is likely that most of you are more familiar with the controversial Fair Tax Legislation than I am, but what I have found most shocking is just how thoroughly The Act's refreshingly new ideas have been swept under the congressional carpet. Neither political party really wants to change the sacred IRC, and why are our media heroes keeping their heads in the sand on this one? Let's squeeze some meaningful change out of the next administration. From an Investor's point of view, implementation of just three elements of the Fair Tax would be an outstanding starting point, even without the more sweeping changes that the Bill addresses.


[The Fair Tax Act of 2003 was authored by Representative John Lindner and co-sponsored by 54 others. Its purpose is: To promote freedom, fairness, and economic opportunity by repealing the income tax and other taxes, abolishing the Internal Revenue Service, and enacting a national sales tax to be administered primarily by the States.]


Now this is pretty heady stuff, for sure, but every bit as easy to implement as real Social Security reform would be. The three changes reviewed briefly below would be an excellent Phase One.


1) Eliminate the Corporate Income Tax, and all other nuisance fees and taxes that businesses must pay just for existing. Whatever any business is charged in fees, taxes, and mandatory assessments is translated into higher prices for goods and services� and at more than a 1/1 ratio. Governments need to look at businesses as employers and wealth generators, not as rateables. Lower expenses should result in lower prices and higher profits, and this would be comparatively easy to monitor for compliance.


Corporations would have more incentive to control their general expenses if such savings would actually make it to a bottom line that could be used to grow the business, compensate owners, and reward employees. More, higher paid, employees and more spendable (untaxed) corporate dividends are good for the economy. How many billions in lobbyist fees would be removed from corporate pricing formulae? With no income taxes or mandated charges to fork over, corporations could focus on growth and innovation. Investors would own more viable companies, selling more competitive products, to a more affluent population. Additionally, fewer jobs would be exported, more foreign companies would invest in the US of A, and GNP would rise at a faster pace. Rising profits would increase dividend payouts, stock repurchases, debt retirement, and employment opportunities.


2) Eliminate the Capital Gains Tax: I've often referred to taxes (or tax avoidance decisions) as one of two "Tails" that "Wag the Investment Dog". Every year, millions of people go out of their way (with professional encouragement) to lose money on perfectly good securities. Those who take profits too soon are punished severely and those whose behavior is tax-wise may severely damage their investment portfolios' future. Although it is clear that the Capital Gains Tax was originally designed to pick the pockets of those terrible folk wealthy enough to play the stock market for profit, it now inflicts considerable pain on all of us� particularly those who foolishly subscribe to the archaic Buy 'n Hold investment (mismanagement) strategy. Times have changed, and the average investor is now a pretty average guy indeed, willing to build a future if Uncle will let him.


A Government that bemoans the population's low savings and investment rates has only itself to blame, and Wall Street Institutions are happy to exacerbate the problem with their own financial pandemic of products, strategies, and tax deferral/avoidance schemes. Fair Tax advocates estimate that Billions of Dollars, Hours, and Antacids could be allocated more productively every year, just from eliminating this portion of the tax form preparation process� not to mention the trees.


3) Eliminate taxation on all forms of investment and Retirement income: Dividends, Interest, Rents, Royalties, Social Security, Pension, IRA, 401(k), etc. It just makes abundant sense, doesn't it? Without taxation, interest rates, rents, and professional's fees, just to name a few, could fall. Personal disposable income would rise and a much larger number of retirees would be able to live comfortably. Isn't this what periodic IRC tinkering is all about? Wouldn't it be cool if all of those different IRAs and self directed plans could be combined and relabeled: "My Untouchable Retirement Plan"? We would all save more and spend more if we had more to deal with.


No one expects a hundred million taxpayers to agree 100% on the final plan. I have problems with taxing education and health care spending, for example, and there is no doubt that displaced IRS bureaucrats will populate new compliance entities that monitor corporate operations. And most would agree that three separate sales taxes would be unacceptable. But real win/win/win change is in sight. We just need a positive leader with some�


Here's my proposed 2006 (and beyond) Voting Resolution for anyone with even the smallest start-up IRA account: "I promise to never, ever, cast my vote for any incumbent, at any level of government and from any political party, that has not clearly demonstrated that the repeal and replacement of the existing IRC is at the very top of his or her political agenda." It's time to reinvent this wheel!