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Thomas H. Kee Jr., is President and CEO of Stock Traders Daily. The Stock of the Week Strategy offered by Stock Traders Daily may be the best performing strategy on the market since December, 2007 (before the credit crisis), and "The Investment Rate" is arguably the best measure of the... More
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  • Macroeconomic Conditions Set To Deteriorate

    Real Net Stimulus in the US Economy ended on April 1, 2014, and the economy is now positioned to revert back to its normalized condition. The natural state of the economy is defined by looking at the natural forces that drive economic cycles, and that means people. The way people spend, and also invest money are the governing forces behind long term economic cycles, but interestingly, spending patterns do not actually influence longer term economic cycles as some might think.

    Instead, it is the investment patterns of people within our economy that has been proven to determine longer term economic cycles. Those investment patterns are influenced by simple societal norms that may seem initially uncorrelated to the naked eye, but have material influence over our investment decisions during our lifetime and new money infusions into the economy accordingly. We grow up, go to school, get a job, get married, buy a house, have kids, retire, and die.

    Extrapolated to include the entire country, we can use societal norms to determine lifetime investment patterns, and then determine the rate of change in these investment patterns year over year, and unless society changes, well into the future as well. There are no signs that society is changing in terms of those societal norms mentioned above, but still, those people who influence our current economy were exposed to societal norms that have already been defined anyway, so we can measure them.

    This measure is called The Investment Rate, and it defines the rate of change in the natural investment patterns in our economy, which in turn have also defined every major longer term economic cycle in US History since 1900. This measure pinpointed the start of the Great Depression, Stagflation, and the start of the Credit Crisis, based on simple observations of the core of all economies, people.

    The Investment Rate defines the economic conditions that exist today without stimulus, and shed light on what the economy will look like when stimulus is removed. This also has a direct influence on our investments in all asset classes, including the stock market, our retirement plans, real estate, private businesses, and any other asset class that relies on new money to grow.

    Given the end of net real stimulus that has already happened, investors must understand the natural condition of our economy, so on Tuesday during Market hours we will host a special webinar discussing this exact point. We will define net real stimulus and the exaggeration FOMC policy has caused, and therefore quantify the risks in the asset classes mentioned above as a result.

    In addition to the Webinar, we have the transcript and summary for this webinar available in our member's area right now for anyone who cannot attend the webinar. Webinar Transcript

    Please join us:

    Title:

    Profiting from the Stock Market without Stimulus

      

    Date:

    Tuesday, April 29, 2014

    Time:

    10:00 AM - 11:00 AM PDT

    After registering you will receive a confirmation email containing information about joining the Webinar.

    System Requirements
    PC-based attendees
    Required: Windows® 8, 7, Vista, XP or 2003 Server

     

    Mac®-based attendees
    Required: Mac OS® X 10.6 or newer

     

    Mobile attendees
    Required: iPhone®, iPad®, Android™ phone or Android tablet

     

    Space is limited.
    Reserve your Webinar seat now at:
    https://www1.gotomeeting.com/register/544665857

    Disclosure: I have no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours.

    Business relationship disclosure: By Thomas H. Kee Jr. for Stock Traders Daily and neither receives compensation from the publicly traded companies listed herein for writing this article.

    Tags: economy
    Apr 28 9:04 AM | Link | Comment!
  • Profit Without Stimulus: Webinar On Tuesday

    Macroeconomics: Due to its popularity and significant importance, this is the second time we are hosting this webinar. We are hosting this at a different time, one that may better accommodate those who were not able to attend last time. However, the transcript is already available for your review on our website in our Special Reports section for those who cannot attend this time either

    Join us for a Webinar on April 8

    In this webinar we will talk about the influence of stimulus, and prove what the economy and stock market will look like without stimulus. We will also prove when stimulus will actually end (that's not when the infusions equal $0) This will conclude with investment ideas designed to profit from the change in Fed Policy as that impacts the economy and stock market. If we know what is coming we can profit handsomely; that is the goal of this webinar.

    • Title:Profiting from the Stock Market without Stimulus
    • Date:Tuesday, April 8, 2014
    • Time:5:00 PM - 6:00 PM PDT

    After registering you will receive a confirmation email containing information about joining the Webinar.

    System Requirements

    PC-based attendees

    Required: Windows® 8, 7, Vista, XP or 2003 Server

    Mac®-based attendees

    Required: Mac OS® X 10.6 or newer

    Mobile attendees

    Required: iPhone®, iPad®, Android™ phone or Android tablet

    Space is limited.

    Reserve your Webinar seat now at:
    https://www1.gotomeeting.com/register/632311000

    Disclosure: I have no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours.

    Apr 06 4:15 PM | Link | Comment!
  • Stock Traders Daily Advised Clients To Buy AMZN

    Stock Traders Daily recently recommended Amazon (NASDAQ:AMZN) as a buy to its clients, this article will include the conditions upon which that was recommended, but in addition this article will attempt to reveal facets of this business that are often overlooked by individual investors. The goal, in addition to discussing the call to buy Amazon particularly, is to help individual investors find opportunities like this on a regular basis. They say if you can teach a man to fish, you have fed him forever.

    First, I have been widely publicized as a critic of Amazon based on valuation. I criticized earnings and price appreciation in particular, but until recently Amazon was a darling. In recent months, the perception has changed, but that also may be cyclical because its busiest season, the holiday season, is almost a year away. Like other retailers, Amazon goes through cycles, and if there's no compelling reason to buy the stock it may come under pressure. Because the holiday season from last year is behind us, some investors might consider Amazon to be in a state of limbo.

    When this happens, it can create opportunity, even for critics like myself. In order for that to be true, however, the critic must first remove his bias. The objective needs to be determined before the observation is made. In this particular case, our objective was to make money. It was not to own Amazon because we believed Amazon was a great company, or that we like Jeff Besos, it was only to make money. Because our objective was as simple as that, our approach to determining proper entry levels for this investment was also very simple.

    The problem most investors face is that they fall in love with one stock, and they tend to not look beyond what they are in love with. Usually, that comes on the heels of a successful trade. Many people have that feeling today with Facebook, because Facebook (NASDAQ:FB) recently increased aggressively. They are falling in love with it, and instead of looking for other stocks that have the opportunity to increase aggressively, investors tend to have blinders on after successful trades.

    I remember my uncle having this exact problem because we made about 200% in laser eye surgery stocks back in the 1990s. We had a great run, but he would not let it go. He kept buying these laser vision companies, and they soon went out of favor. He did this because he fell in love with the trade, but love is an emotion, and there is no place for that in this business.

    Without a doubt, I'm not in love with Amazon at all. We're in this to make money, nothing more, and according to our correlation filters Amazon triggered based on a test of longer term support as that is defined in our real time trading report for Amazon. Our recommendation to clients was based on price, given that test of support, not on the valuation metrics or our appreciation of management.

    By focusing on price, we also effectively remove golden handcuffs like those some investors might currently have bound to them after investing in Facebook, and like my uncle did back in the 1990s with laser vision stocks. Golden handcuffs can be the worst thing for individual investors, and interestingly those are usually the direct result of a successful trade.

    In order to make money consistently, individual investors should avoid the temptation of falling in love with any particular company. In our situation with Amazon, I am still a critic, but because the stock tested our longer term support level we were buyers, and we intend to hold that position until such time as the stock tests our longer-term resistance level, or profit stops are hit.

    Lastly, according to our real time trading report for AMZN, we do see upside potential in the stock, but we prefer to buy near tests of longer term support because by doing that we also have clearly defined risk controls. Trading in the middle of the trading channel is not advised because risk controls widen considerably when mid-channel trades are made.

    Disclosure: I have no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours.

    Business relationship disclosure: By Thomas H. Kee Jr. for Stock Traders Daily and neither receive compensation from the publicly traded companies listed herein for writing this article.

    Additional disclosure: AMZN was recommended as a buy to clients of Stock Traders Daily.

    Mar 05 1:11 PM | Link | Comment!
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