Investors often suffer from home-team syndrome. US investors are particularly guilty of looking at only the stocks located in their home markets and ignoring the rest of the world.
The truth is that while something on the order of 11,000 stocks trade here in the United States, shares of more than 50,000 companies trade around the world. More than 1,800 companies trade on one of the various US exchanges, giving us unprecedented access to foreign securities.
As value becomes harder to find in the domestic markets, it makes a certain amount of sense to cast your eyes on the international markets in search of long-term returns.
The banks in Cyprus will reopen tomorrow and let account holders pull up to 300 Euros out a day. I don't know about you, but I'm pretty certain that if I lived in Cyprus I would want to get all on my money out of the bank as soon as I could. We thought we would ask our readers.....
Please leave a comment along with your vote. We would love to hear what you think about the banks in Cyprus.
Cyprus has imposed limits on money transfers and hired extra security guards to prepare for the reopening of its banks, which have been shut for almost two weeks to avoid a run during the country's financial drama.
A banking official said Wednesday that new controls will include restrictions on large-scale transfers from the country's two largest and most troubled lenders, Bank of Cyprus and Laiki, when they reopen Thursday. Both are being restructured and big depositors face losses of as much as 40 percent.
Authorities are looking to increase the daily withdrawal limit from 100 euros to 300 euros (from $130 to $386), while payroll payments will be allowed in order to help businesses, which saw a huge slump as people cut down on their spending amid the uncertainty swirling about the banks. Continue reading "Banks preparing for reopening in Cyprus"→
The above quote is from William Gouge, commenting on the Panic of 1819. The panic had been caused when the First Bank of the United States had first expanded the money supply dramatically by offering loans, then contracted the money supply by tightening its requirements for new loans, causing a crash.
This is a useful quote, as, in its simplicity, it states the very nature of crashes brought on by irresponsible banking practices. In every case in which this occurs, it is possible through the complicity of the government of the day.
The origin of this syndrome goes back to Mayer Rothschild, a very clever fellow who, in the late 18th century, offered financial benefits to politicians in Germany in trade for political support for whatever activities his bank might practice. Rothschild was a long-term thinker; his method involved the offering of regular emoluments to politicians without their having to provide him with anything immediately. Then, when he needed a large favour, he would call it in.
Movie buffs may see a similarity between Rothschild's method and the deals made by Don Corleone in The Godfather. "Some day - and that day may never come - I'll call upon you to do a service for me."
Hello traders everywhere, Adam Hewison here co-founder of MarketClub with your 1 p.m. market update for Monday the 22th of August.
Forget the news, if you want to trade successfully.
Many news stories, particularly when it comes to the markets, are basically fed to reporters by folks who have a vested interest in that particular market. I've seen this happen time and time again, when information is given to an online anchor or someone else who is on air and reading the latest news. The information that they report, may be not accurate. In the competitive rush to get news online, and be the 1st to break a story, very few stories are ever checked and triple checked.
So we wake up this morning with the potential conflict in Libya over, and Libya's Colonel Qaddafi's 42-year reign of insanity has maybe come to an end. Based on that news, the Dow rallies up over 200 points. Let's see, that little conflict cost the US about 1 trillion dollars, money we don't have. How could that be good for the market? Now we are tying the news in Libya to the markets here and the terrible economic conditions that exist - it is a stretch by anyone's imagination. The truth is, that the markets probably rallied based on a short covering. Many active traders went home with short positions over the weekend. When the markets did not follow through to the downside they quickly covered their short positions and pushed the market higher.
So here's my advice, do not pay too much attention to the news. Let the market, and the price action give you all the direction you need. Market action is the # 1 item to watch to be a successful trader.