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!

Insuring Your Future By Letting Properties

Buy to let property is a fantastic way to ensure your future. Why are there so many people interested in purchasing properties? Instead of investing your hard earned money in the stock market some people recommend that you buy properties to let because it can be a much safer and stable way to earn money on your investment. In fact, those people that formerly relied on the dividends provided by shares to build up their pensions are now turning to this type of investment.

Michael Flannagan, a property owner explains why everyone is interested in buying property: "I can trust that my properties will be worth something in the future. It's not like shares where I don't have any guarantees and nail biting is common."

People are buying up property as fast as they can because the return on the investment is far more reliable than any other short or long term investment. Becoming a landlord is an excellent way to earn a decent return on your investment�once the mortgage is paid in full, all of the income associated with the property you let will be profit; less tax and the cost of property maintenance of course. If you do things wisely, the money earned from the property you let can actually pay the mortgage. Unlike the price of shares which can fluctuate wildly, the value of property rarely declines. Clearly, the act of letting properties is based on the safety of the investment.

Nevertheless, when you start buying properties to let there are a few things that you will need to consider. First, being a landlord is not always a simple task: at least it is not as simple as it first sounds. As a landlord, you will be legally responsible for the property and will be governed by various legislation that applies to letting properties. The best person to advise you about your rights and obligations as a landlord would be a solicitor�one knowledgeable about properties and property letting.

You will also need to consider that there may be times when the property is vacant between tenants so good accounting needs to be applied. Remember, if you are counting on the money you get for letting the property to pay the mortgage you won't necessarily have the cash immediately available. Clearly, if you begin buying properties with a view to letting them, it would be better that you have a contingency to cover the mortgage during the periods where you will find yourself without a tenant.

Another thing to consider as a landlord is that not every tenant is going to be the perfect tenant. In fact, some tenants may damage the property and you may be forced to make repairs to the property before you are able to let the property again. Again, having a cash reserve for such occasions is warranted in order to be truly prepared for whatever mishap may come your way. Better yet, investing in building and contents insurance is a must if you plan on letting any property�insurance should help you cover some or all of the damage to your property.

When you decide to invest in property you will want to buy in an area that has many resources for the potential tenant. In fact, the more resources available for the potential tenant or tenants the better�resources such as nearby shopping areas, recreational facilities and schools all make the property you plan to let particularly attractive. By purchasing property that is surrounded by resources, you will find that you will have a much easier time in letting the property. This is an important forethought when choosing your property.

Experts also advise that you keep the property you purchase for the long term if you really want to gain better returns from your purchase. Ken Derby, a property agent states it well, "Be prepared to hold on to the property you purchase for the long term. Don't be in a hurry to make a fast turn around and don't panic if the property prices drop suddenly. Property prices will rise again and your investment will be fine if you don't panic."

Don't expect to rake in the cash once you purchase a property. Remember, like shares, purchasing property is an investment in the future, one that can make you a considerable capital profit over time. Only after the mortgage is fully paid off will you begin to see a significant turn around in terms of income but on the other hand, you can establish a regular moderate income by letting properties that are geared correctly�where the rent is more than the mortgage payment�of course, you won't want to set the rent too high as it could deter tenants in a competitive market.

There is money to be made buying properties and letting them as long as you buy the right property and are willing to hold on to your initial investment as well as being properly prepared for the "down" periods. For all intents and purposes, the buy to let trend is replacing the market in shares investment because there are far fewer risks associated and buying a property to let can be a more stable environment for your hard earned cash.