Posts Tagged ‘Great Depression’

How to level the playing field at the stock market?


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Back in the day when RedHat was going public, many of the people who gave their time and talent to making free software and linux were named and shares were reserved for them at the IPO price of each. Most of them were NOT allowed to purchase the shares since they had no history of trading. Within a week of the IPO, RedHat stock was selling at /share.

But the people who helped build it were left out in the cold.

Nowadays, some wealthy person can make shattering amounts of money whenever the stock market is weak by a marathon session of selling short, driving the market down in the process, and gaining great amounts of money from the 401(k)’s of folk like you and me.

In the Great Depression, Franklin Roosevelt grabbed one of the most unscrupulous traders of the time and shanghaied him into writing regulations to prevent the abuses that he knew about. Perhaps we need to do something like that again, because the relative wealth of some folk make it almost impossible for each of us to come out winners.

But who? We are out of rich Kennedys who know the market.

Perhaps Ivan Boesky?

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i need help with a couple more ECON questions?


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i have four more of them

7.identify the gains in consumption and production effiency from trade, with emphasis on the main products and changing geographic patterns of twentieth-century trade among countries in the western hemisphere

8.compare the reasons for teh effects of trade restrictions during the great depression compared with present-day arguments among labor, buisness, and political leaders over the effects of free trade on the economic and social intrests of various groups of americans

9.understand the changing role of international political borders and territorial sovereignty in a global economy.

10.explain foreign exchange, the manner in which exchange rates are determined, and the effects of the dollar’s gaining (or losing) value relative to other currencies.

thanks again!!

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How To Make Money Investing In Stocks During Recession


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good stocks in a recessionThe 2008 recession and stock market crash is the worst financial and economic crisis since the great depression. By Feb 2009, the Dow has dropped almost 50%, erasing all its gains since 1998. In terms of absolute points, the Dow has dropped over 7000 points, which is more than the entire Dow index before 1998. Without doubt, this stock market crash has rendered many traders and investors helpless in search for profit.

Even though profiting during such market condition is a really tough thing to do, traders and investors still bought stocks in hope of a recovery only to be disappointed again and again leaving a bunch of stocks in deep losses in their account. When money is used this way, what it really does is to rob investors and traders of cash for investing when the real recovery starts.

Discover The Day Trading Robot

So, is there a way to place those bets with very little money and limit your losses to negligible amounts if your bet is wrong as it had been so many times in this stock market crash so far? Yes, the answer can be found in stock options trading.

Everyone knows that stock options trading is risky and that you could potentially lose all your money. What everyone failed to recognize is the fact that stock options trading is also a risk limited way of trading for big profits while controlling potential losses to negligible amounts!

Stock options investing are contracts that allow you to buy a stock at a specific price no matter how high the price of that stock is in the future (Call Options) or sell the stock at a specific price no matter how low the price of the stock is in the future (Put Options).

By replacing the buying of the stock with buying its call options, you will be able to control the profits on a stock using just a small amount of money. If the stock goes up, you simply sell the call options for the same profit as you would as if you bought the stocks. If the stock goes down, you lose nothing more than the small amount of money you paid for the call option contract. See where I am going with this? If you had bought only the call options of those stocks that you have bought all of last year, you would have lost only a small fraction of the losses that you would already have incurred through buying the stocks.

Let’s look at an example.

John and Peter have $15000 to invest with each and they both decided to buy shares of Apple Inc, AAPL, after it has dropped to $141 in October 2008, expecting a rebound. Peter decided to buy 100 shares with $14,100 and John decided to play it conservative and bought 1 contract of AAPL’s call options with strike price of $140 which was asking at $10.20 for a total price of $1020. 1 contract of call options allows you to control the profit of 100 shares of the underlying stock. In this case, John totally replaced the buying of 100 shares of AAPL with buying 1 contract of its call options. 2 weeks later, AAPL fell all the way to $85 as the recession deepened. Peter lost over $5600 while John lost only the $1020 that he spent buying the call options.

Assuming both Peter and John were right about AAPL and the stock rallies to $200. Peter would have made $5900 in profit while John would have made the same $5900 less the amount of $1020 that he paid for the call options.

See how buying stock options rather than the stock itself in this volatile condition allow you to make a few bets for a rebound without risking all your money? In the above example, Peter would only be able to make one bet once on AAPL with $15,000 while John would have been able to make those same bets more than 10 times at strategic support levels. Who would have a better chance of winning?

By replacing the purchase of stocks with controlling the same number of shares of that stock through its call options, you would definitely have a better chance of survival in this recessionary market condition. Be warned however, that you fully expect to lose the entire amount of money paid on the call options should the stock continue to go down, which is why you NEVER use all your money in a single trade.

Go Here To Discover The Day Trading Robot Now!

By: Master J - Founder, MastersoEquity.com

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Investment Tips during A Recession

Financial gurus will actually make money during a recession. In fact, the current economic situations should have no significant impact on your personal finances as long as you think smart and plan ahead of every investing decision you make. Even if you usually tolerate medium- or high-risk investments, a recession is the time to scale back. While you do want to continue making money from investing, high-risk behavior is going to be your worst enemy.

Crash To The Past

No, the title is not about another stock market crash - it’s about crashes in the past. This one is a one-pager about the Nikkei Index collapse that began in the early 1990s. I remember being in college at that time, and the Japanese [...]

Economic Collapse

I am also aware that at any time a stock market crash may happen and that it is time to be ready for it. The VIX index which tracks fear is very low and this is an indication that a crash will not happen soon however.

Jason Ng is the Founder and Chief Option Strategist of Masters ‘O’ Equity Asset Management ( MastersoEquity.com ) and author of an Options Trading education site, Optiontradingpedia.com. He is a fund manager specializing in options trading and his revolutionary Star Trading System has helped thousands.

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