I am a retired American psychologist investor making around 25% capital gain per year for the last 15 years. I wrote 2 books on the psychology of investing. The books are not selling well because people believe that you need to know economics more than psychology to make money. Let me show you the main points about making money in the stock market: It’s psychology, not economics!
- Focus on making money your way only but pretend you listen to others, that means pick up only the right company, buy its shares low and sell high, that’s it! For example, as soon as I watched the movie Toy Story with my wife in 1998 I checked out a tiny company called Pixar that filmed it and an unknown CEO called Steve Jobs that bought it from Lucas from Star Wars and bought shares low! I connected the dots!
- Focus on selecting the best CEO (read my books or study personalities of CEO’s), your CEO’s great decisions are the only reason to buy the shares low! For example, as soon as CEO Bezos started Amazon I studied his personality and bought his shares, turned out a winner!
- Great decisions are behavioral and probabilistic, not what you fast think about but what you slow feel about, say and do! Great decisions are called System 2 analysis, not System 1 heuristics. Read Daniel Kahneman’s book “Thinking Fast and Slow.”
- Focus on building a positive relationship with money. A relationship with anything is a set of 10 sacred rules you adopt about that thing. For example, be more careful with your money if you come from a poor family!You tend to lose it and get back to your familiar expectations.
- Poor decision-making by the CEO is the only reason to avoid buying shares in his company. Simplify life!
I taught Transformation and reversibility for 27 years in college and when I retired no one in my department took to it, why? May be psychologists don’t like to teach about the top 1% of the best ideas in the world lest they lose their credibility with the weird stuff. I don’t care. It is a fact that people in general don’t like to talk about the top 10% of the information in their lives that could make a real difference. It looks weird. This 10% Rule is mentioned in all my blogs and books (even in my case study how to reverse cancer, delivered at the University of Berlin last year!). People just stay away from what is important to know in their lives because it makes no sense, Period: Don’t ask me why deeper, I don’t really know. I am one of the very few lucky ones who seek out the 10% information that is on Google that no one else even looks at. That is how I cured my cancer with Dendritic cell therapy, that is how I have one of the most beautiful homes in Canada, top friends, 4 kids, a fantastic wife and top money. Yes, very few brave visitors go through my blogs to find the 5-6 articles on the 10% Rule. People just don’t believe anymore that the answer in just in front of them – on Google! And, if I told you that these rules come from Freud, Piaget and Skinner, you’d get turned off and won’t ever bother to read my blogs.
Transformation and reversibility is not just in the 10% Rule, it’s in the 1% Rule! Top of all tops info from the 25th century!! The rule was discovered by Dr. Piaget, the Father of European Education that no one listen to either. He asked a 6-year-old kid;
‘Jimmy, do you have a brother?”
“What’s his name?”
“Does Bill have a brother?”
Jimmy didn’t transform (reverse) yet. If you have a kid that would answer “yes” at age 4 to the above question, you have genius! So, you see that if you master the 1% Rule concept you could apply it to anything you want to change big time! Take making money. You buy shares in a company like Apple that offer shares before they transform upward, that is, when the graph hits the support level 2-3 times and wouldn’t break down through (don’t try it before taking courses on Transformation and Reversibility). I know stupid people who buy shares when the price hit the resistance level trice and reverses downwards. Learn Transformation, you’ll be soooo happy and successful!
It’s about AAPL. Some of you bought a 1000 shares at $7.00 15 years ago and are now RRF (rich retired folks). Your strategy is to sell 100 shares every December and add about $100,000.00 to your retirement income. Smart guys! Look at the AAPL chart starting from today every day with one question, When should I sell? I have about 2 weeks to decide. Apple has reached its support level of $105.76 today. That means that it may go up on Monday, but not by much although its resistance level is at $121.06. Why? Because its secondary resistance level is at $119.03. That means that it if Apple shares go up on Monday they may end at Friday’s daily range of $109.5. I’d wait a little longer. Why? Because of Christmas. The pessimist (sell) vs. Optimist (buy) mood for the last few days of the 2015 year will depend on what happens during the holiday, 1) The flight to see relative (smooth/ anxious), 2) Christmas period (joy/painful), 3) The relatives (enjoyable. anxious), 4) Did a good analysis of the stocks/or were too busy, 5) Needed to sell for tax reasons, 6) Dividends considerations, and 7) Investor personality excellence (IPE). This one is simply record of decision-making success in the past. Mine is 8/10. Any 7/10 is very good! Good luck, Merry Christmas, life is good (LG). Good news if you own an LG appliance, you may have the skill of selecting what works!
At first I tought president Obama was kidding, but then I thought that I got it. He was talking about Solar City that jumped 34% today. I got happy because I bought shares of Elon’s company last month, but then it became delusion. Obama was talking about carbon emission, stupid! At the end it was just a stupid president for 8 years, a kid who likes to play in Paris who doesn’t understand global priorities. Then, as a very successful investor, I realized the potential in Elon Mask in 2015 that I saw in Steven Jobs in 2000. You can call me a psycho-economist, may be that is why I can connect the incredible dots like I did when Steve reigned supreme. Can you imagine buying AAPL at $14, today it’s energy at $30. I won’t tell you what to really buy, why should I help you get lazy? I will tell you only an imaginary scenario. Carbon made energy died today, clean energy was born this morning. People don’t load because they just see a kid. It’s like when Google was born, people didn’t buy because they saw 2 kids. I bought Solar City because Elon Mask has a 200 IQ and a Type A personality, 2 factors out of 100 smart and rare traits that he brought from SA. His Solar City went up today by 34%, all the other 10 clean energy solar companies averaged 10% only. I am not even talking about Tesla or Space X. The guy is a genius. If you buy his stocks and you are not very smart yourself – you’d lose. This is not gambling game at all. This business of the future is too smart for a social simpleton like Obama. The Saudis are shifting from earthy energy to sun energy. Millions will starve because they don’t even understand what I’m talking about. The earth is changing from costly energy to free energy. 2016 will be like surfing, someone will catch the big Hawaiian Wave. The rest will play it safe with air pollution. Earth is losing the logic. A losing country will encourage savings and austerity like Japan did or the EU does now. A winning country will encourage investing from age 10 on and teach it RIGHT in school (because economists don’t design a stupid curriculum anymore). It’s not a global warming, stupid, it’s your political orientation that matter to the standard of L! You don’t understand economics. I am talking to you, PhD’s from the University of Chicago! Change! Smith was wrong!
National Post, Tuesday, December 1, 2015, Financial Post section (FP$):
Loonie not weak enough to effect change: Report by John Shmuel. Loonie dropped by 13% in 2015.
I, an American psychologist who retired to Canada is all smiles today with the money news. I retired as a college professor and moved from Los Angeles to Vancouver in 2000 and became an Exchange Junky, checking out the curve from WS every day, like many Americans living in Canada do. I gave a speech at Simon Frazer University on parapsychology and taught the nurses about a Near Death Experience (NDE) at Langara college and told my Canadian wife, “Vancouver is my place, honey, I love the people, the environment and the Exchange Rate.” That started my life long relationship with the US/CAN Exchange rate. Man, I was so “hot” then trying to master the trend. I went back 20 years checking the graph to find the business cycles of the 2 countries. There were times during Canadian boom that I got less loonies for my US checks and had to tighten the belt while there were times during Canadian bust that I got more loonies for my US checks and started building a house.
Bonanza: In 2015 the loonie dropped by 13% as John Shmuel says in his article. I got $7,000.00 more for a $25,000.00 US check! Hurrah! My appetite for loonies got wet, I love this country of “low energy” as Trump would say. “I expect the Canadian dollar to drop even more in 2016 untill the Canadian industry finds itself. More accurately, find its footing during the drop in oil prices and fracking (you may need Elon Mask the electric car immigrant to open a factory in Canada). There is no balance between exports and imports to the US, between low oil and high fracking. An expert economist named Hui expects the loonie to drop to 72.46 cents US. I will tell you why I think the loonie may drop even more. Can you imagine getting $40,000.00 CAN for $25,000.00 US next year?
The reasons are, 1) Trudeau was elected: Let’s face it, Canadians love their big government. The new prime minister of Canada is a sweet cooperating liberal, the opposite of Trump, who is a mean, competitive conservative (the loonie will get weaker). Canadian liberals are like American democrats. They believe in saving money, not investing. They like mutual funds, not individual stocks (I see it as ‘misery loves company’). They relay on oil and big taxes for gov income, not capital gain and profits. They love government services. Poor industrial production and low oil prices will make the loonie unattractive to exchange for US dollars. You may have to spend $1.40 CAN to get one US buck for your business. 2016 is shaping up to be a great year for residents or vacationing Americans in Victoria, 2) Trump may be elected. I think he is noisy and too competitive, almost nationalistic for most nice Canadians. If Trump becomes president and the American dollar ears a higher interest rate as expected in 2016, US productivity will zoom and you Canadians may have to part with $1.5 CAN to get one $1.00 US. (it happened in 2001). As I said in my last posting…life is good!
A few years ago my friend Peter and his professor wife, lived in San Francisco and taught at Berkeley University while owning an old house near the BC legislature in Victoria, BC. One day, near retirement time, they made a decision to sell their second home in Victoria because of financial reasons. They sold the small house in my town and moved to San Francisco (I miss them). They call me from San Francisco and said, “Elior, we finally sold the cute house. We now have half a million dollars in our saving account at Van City credit union. You are an investor, what would you do with the money in such a situation? I thought for a minute and said, “I would spend a few hours on Google, study the exchange graph between Canada and the US for the last 10 years, do my calculations, find the pattern and project the period I could get at least $1.02 US for every $1.00 Canadian in the Exchange market. (don’t forget to ask the clerk to call headquarters to get a favorable exchange rate for amounts greater than 25 grand). They got $510,000.00 US for their $500,000.00 CAN. They called and thanked me. They are still my close friends, now retired. Let’s say they miss Victoria in 2015 want to buy a nice apartment in Victoria. They said many times in the last 6 years that they would like to live in both countries and they love Victoria for its friendly people and beauty. If they took out their money from the San Francisco credit Union and wrote a check for their account at Van City, they would get today $663,000.00 CAN, not bad for making $163,000.00 CAN for moving around!
But, there is a catch. You don’t need a PhD to learn how to make money living in any 2 countries. What you need is more love of making money than fear of trying. I can give you the basic rule but I can’t erase your fear/love ratio if it’s bad. Even worse if you have a belief that playing the exchange rate risk or a gamble. It isn’t either, it’s a challenge to a smart person! Here is what I told Peter (rule as applied to US/Canada), “If a Canadian government is a confident, assertive right-wing conservative entity that likes to invest and do business with the US and others, wait for the exchange rate to start climbing in the direction of $.98 CAN = $1.02 US. If a Canadian government is an insecure, lazy left-wing liberal entity that likes to save for a rainy day and make its money by selling Canada’s natural resources, wait for the exchange rate to start moving in the direction of $1.o2 CAN = $.98 US. (do a similar analysis for an US government!).
Both Harper and Trudeau are lazy dudes. In the last few years Canada sold mostly oil to the US and earned very little industrial income money. This trend will intensify with Trudeau’s liberals. $1.02 CAN = $.98 US has already kicked in big into $1.33=$.77, in fact today’s $25,000.00 US will get you almost $34,000.00 CAN at Van City. American tourists love Victoria praying that Trudeau stays and even get reelected!
Life is good if you read my blog! You sure know stuff, my friend!
A few books and investing magazines lately came out with views how to invest and make money big time. They are like the republican candidates during the debate, except for trump, People like to rehash old stuff that looks like new and believe it will work this time.. Take Bush, for example, he gets 4-5% of the voters just for talking. Look, these magazines and books on money have very little to offer because you have heard their ideas about making money before, all the same, so what else is new, you’d ask. Then Trump shows up and turn over the tables at the Temple like Jesus did. That is me. I am sorry to say that none of the books on investing except mine, in my opinion, make sense big time! But they are more interesting to read. Mine is work! I make sense to make money for me. It is expected that all companies that advertize a “system” how to advance financially do it for themselves trying to write in such a way that you would think it’s for you. They actually show graphs and rules that worked for them at about 10%.
How do you write to show smart people how to make money for themselves? First, you have to show that your income is not dependent on selling your ‘stuff.’ Second, You have to see NEW rules, rules that are different from what you heard before, logic you never heard of, ideas that standard investors will reject, and so on. I wrote 2 books on money, new rules to try to follow and make money. Let me give you my first rule only for fun: Pick up a company in Wall Street that you feel for. Ignore the board completely. Study the founder CEO only, if you want him or her as your parent, mentor, main guide or best friend, that is your first pick. If he dominates the board, that is even better, If he is married and has kids, great wife and wonderful family, that is it!!!
I won’t give you more rules. If you are smart you will find your way to riches from here. If you are stupid you will continue to do what you did before believing that you have definitely changed! Good luck, Charley.