Do you think US treasuries are still safe?

[Texas Proud]

I think they *do* enrich themselves with their own advice. All of their newsletter writers (that I know of anyway) appear to be pretty well-off. Of course that could be window-dressing.

I think you miss Nord's point.... why SHARE these gems of making money instead of pushing it to the hilt and becoming a multi billionaire... I guarantee if I had a great way of making money IN THE MARKET, I would not share it with anybody else because that would dilute that way of making money... and subscription fees are small potatoes to what I could do investing a few mill that I leveraged for my can't miss investing...


And who says they are not well off from subscription fees and not investing...

 

[GaryInCO]

I can't speak for their motivations. They may be nefarious and larcenous, or they may just be looking for something interesting to do instead of spending all their time on the golf course. It's also entirely possible that these guys use the newsletter as a form of enforced discipline to keep them doing the analysis they need to do for their own accounts. Trading tends to get pretty boring after a while so it's too easy to let it slide if you don't have a deadline.

I can only speak from my own experience. 10 years ago I *DID* have a great way of making money in the market. I ended up opening a commodity fund and trading that approach for clients. In my situation I was cash-starved (long sordid story) so I didn't have enough capital to make big profits with my own account. 100%+/yr profits are not too exciting if you've only got $20k to work with. The client fees enabled me to increase my income far beyond what I could have done with my own funds.

These newsletter writers obviously don't have the leverage that I got from trading OPM. But this is an example of when someone *might* use their great market juju for something besides their own account.

 

[Texas Proud]

I can't speak for their motivations. They may be nefarious and larcenous, or they may just be looking for something interesting to do instead of spending all their time on the golf course. It's also entirely possible that these guys use the newsletter as a form of enforced discipline to keep them doing the analysis they need to do for their own accounts. Trading tends to get pretty boring after a while so it's too easy to let it slide if you don't have a deadline.

I can only speak from my own experience. 10 years ago I *DID* have a great way of making money in the market. I ended up opening a commodity fund and trading that approach for clients. In my situation I was cash-starved (long sordid story) so I didn't have enough capital to make big profits with my own account. 100%+/yr profits are not too exciting if you've only got $20k to work with. The client fees enabled me to increase my income far beyond what I could have done with my own funds.

These newsletter writers obviously don't have the leverage that I got from trading OPM. But this is an example of when someone *might* use their great market juju for something besides their own account.

Let's see... just using 100% (and assume that the + pays for the taxes)...

Start at $20K
1st year $40
2nd $80
3rd $160
4th $320
5th $640
6th $1,280
7th $2,560
8th $5,120
9th $10,240
10th $20,480,000..... or over $20 MILLION by now...


Sound like something that would keep me interested... and if I could show that kind of gain each year... I think I could borrow some more money to get it even higher... heck, borrow at 10% and make 100% is a good deal.. And just think, I would be in line to make $20 million this next year


Another thing is do they post their personal returns If someone is wanting ME to pay THEM for their advice, I want to see their results with their money.... if it does not match their advice I would want to know why....

Thats just me... I am sure that other disagree.... I am sure you do...

 

[GaryInCO]

Let's see... just using 100% (and assume that the + pays for the taxes)...

You are neglecting to consider the DW who insisted on bleeding off every cent of profit for household expenses, since I was doing this full-time. (Even though she was earning enough to fully support the family while I built up the account. She couldn't tolerate me making money and not immediately dumping it into the family coffers. She just refused to understand the "eating your seed corn" concept. That's part of the long sordid story.)

There's also the little problem that just as I started to roll this thing into some big profits, 9/11 happened, and that blew a hole in the market dynamics I relied upon.

Stuff happens. Those pretty "X%/yr and by next week you own Australia" examples don't often work out in reality.

Another thing is do they post their personal returns If someone is wanting ME to pay THEM for their advice, I want to see their results with their money.... if it does not match their advice I would want to know why....

I don't know anybody who does that in the newsletter business. I did it with my fund because MY account was the track record we used to attract clients.

 

[Texas Proud]

You are neglecting to consider the DW who insisted on bleeding off every cent of profit for household expenses, since I was doing this full-time. (Even though she was earning enough to fully support the family while I built up the account. She couldn't tolerate me making money and not immediately dumping it into the family coffers. She just refused to understand the "eating your seed corn" concept. That's part of the long sordid story.)

There's also the little problem that just as I started to roll this thing into some big profits, 9/11 happened, and that blew a hole in the market dynamics I relied upon.

Stuff happens. Those pretty "X%/yr and by next week you own Australia" examples don't often work out in reality.


I don't know anybody who does that in the newsletter business. I did it with my fund because MY account was the track record we used to attract clients.

Yes... the wife can put a big hole in savings

I also agree about the 'owning Australia'..... that is why I put it down... heck, a few years ago I was able to increase my mom's play account by 60% in one year.... then the crisis hit and it went down by 80%.... stuff happens which is why most 'systems' do not work in the long run...

An on publishing returns.... why do they NOT put down their returns To me that is a big red flag... and with the new rules about saying if you are long or short in a position you recommend on TV etc.... I am struck by how few of the talking heads actually OWN any of the stock they tell you to buy... but I do not watch them very much so I could be wrong in this view....

 

[GaryInCO]

Actually I think there are regulations that *prohibit* them from owning the stocks they recommend, so they can't buy them, talk them up in their show/newsletter, then sell them for a quick easy profit when all their followers pile in. I know the Stansberry analysts are specifically prohibited from owning anything they recommend, or so they say. They can own other similar stocks in the same industry but not the ones they write about.

When I first figured out my trading system, I took a $27k account to $188k in 6 months. (That was before SWMBO got insistent.) Then the dotcom bubble popped, and things slowed down considerably, but I continued to make good money. At conservative leverage levels we returned about 35% for our clients, after all fees, in 2001. I didn't hit a really bad spell until after 9/11.

 

[Texas Proud]

Actually I think there are regulations that *prohibit* them from owning the stocks they recommend, so they can't buy them, talk them up in their show/newsletter, then sell them for a quick easy profit when all their followers pile in. I know the Stansberry analysts are specifically prohibited from owning anything they recommend, or so they say. They can own other similar stocks in the same industry but not the ones they write about.

When I first figured out my trading system, I took a $27k account to $188k in 6 months. (That was before SWMBO got insistent.) Then the dotcom bubble popped, and things slowed down considerably, but I continued to make good money. At conservative leverage levels we returned about 35% for our clients, after all fees, in 2001. I didn't hit a really bad spell until after 9/11.

I thought they could own anything, but just had to disclose their positions... either long or short... anybody know what law this falls under I actually do not know and could not find anything on my quick look.


If your system was with the dot coms.... then IMO it was not a system but running with the bubble... if it was not in the dot coms, then why would it have disappeared? IOW, a 6 month huge gain is not a system. I am not knocking what you did at all, but a 'system' works in good times and bad times and over many years.... or it is not a system, but luck...

 

[GaryInCO]

Nothing works all the time. Nothing. MANY things that worked for decades have stopped working in the last 10 years. You find something that works, and you ride it until it doesn't work any more. Then you find something else that works. That's the way this game works.

My system worked from the time I first developed it in early 1998, through the end of 2001 and the sea change that happened after 9/11. I just wasn't smart enough to follow it until late 1999 -- if I had, I probably would have retired years ago.

It was not based on the dotcoms per se, but ran on the ND100 index futures. It churned out money like crazy while the dotcom bubble was roaring -- though 40% of those $27k-to-$188k profits were on the SHORT side, so it wasn't just "buy anything and ride it up." It still worked after the bubble burst and the market headed down, just not quite as crazy as before. It worked until the whole market psychology changed after 9/11. Almost everyone I knew of suffered similar problems after 9/11. It changed the game pretty fundamentally, and broke almost everything.

 

[traineeinvestor]

The depression I don't have a handy one for, but a fascinating book about the history of speculation would fit the bill for the 1920s: "Devil Take the Hindmost," by Edward Chancellor.

You could try "The Great Crash" by JK Galbraith for a look at the 1929 crash and subsequent depression.

David Cannadine's biography of Andrew Mellon also covers the period on either side of the 1929 crash in some detail and gives an interesting perspective.

For the hyperinflation which gripped Germany (and other parts of Europe) in the early 1920s, Adam Fergusson's "When Money Dies" is well worth a read.