If you don\’t know where you are going any road will get there. After you get there you might not like where you ended up. You must plan ahead for your trip.

Do you know where you are going with your retirement portfolio? Do you have a plan mapped out? Do you know what to do if your plan starts hemorrhaging money like a stuck pig? Remember 2000? Of course that will never happen again, will it? I\’m glad you are so confident. I\’m not.

Every professional trader has a plan. Wait a minute. You say you are not a professional trader and you wouldn\’t trade like they do anyway. Well let me let you in on a little secret. If you don\’t learn to invest like a pro you are going to give him all (or most) of your money whether you like it or not.

What is it like to trade like a pro?

You won\’t like it and your broker and financial planner will like it even less. It is simple. The road to success is the road that has an exit ramp, in fact, several. It is like doing the Baja Road Race and carrying many spare tires. Without several tires you are not going to make it. Where are those exits? Why so many spare tires? Because without them you will be off the road in a ditch and unable to carry on.

The exits and the tires are your protection against becoming lost or broken down on your way to a comfortable retirement goal. To get where you are going in any vehicle you must not be stopped so you have to find an exit ramp when everyone else stays on the stagnating highway. That spare tire is one of your stocks or mutual funds that has gone flat and must be replaced. You are going to make it. The poor (sic) people who have no plan will remain mired on the highway to nowhere.

There is a secret to being a successful investor and it is one word – SELLING. Yes, any fool can buy, but it is the wise man who knows how to sell. That is called an exit strategy. If you do not have one you are doomed to lose money. During the long term bull market from 1982 to 2000 everyone became a financial genius. Now that we are in a long term bear market (that history shows us lasts an equal length of time) many of those financial geniuses are back in kindergarten and may not have time to graduate.

As the current stock market becomes more dangerous it is time to get out your road map to see where the exits are. It is time to realize that some of your tires could be wearing thin and may need to be replaced. No one is going to do this for you. Not your broker or your financial planner. You are the driver and a successful conclusion to this journey is completely up to you.

Al Thomas\’ book, \”If It Doesn\’t Go Up, Don\’t Buy
It!\” has helped thousands of people make money
and keep their profits with his simple 2-step
method. Read the first chapter at
http://www.mutualfundmagic.com
and discover why he\’s the man that Wall Street
does not want you to know.

Copyright 2005

Writen By : Al Thomas

Tags: 401k, finances, funds, investments, ira, mutual funds, portfolios, retirement, retirement investments, stocks

Congress recently passed another new law that is supposed to outlaw financial crime. Corporate officers will be sent to jail for ?cooking the books? as it is called. Among other things it is taking the stockholders money and paying themselves huge bonuses for nonperformance. These guys are even worse than mutual fund managers who do the same thing ? get paid big salaries yet continue to lose your money.

I can remember many years ago (I?ve got a few years on me) when they started building very fancy prisons with nice cells and tennis courts and nothing but a tiny fence around them. The story was these were being built for government officials who might get caught with their hand in the till and I have no reason to doubt it.

Today we have the new Sarbanes-Oxley Act that makes it a federal crime to commit financial fraud of various kinds. This new piece of legislation is going to be about as effective as the Brady Bill was in eliminating crimes committed with a gun. A crook is a crook is a crook. With or without a gun.

It seems that most of these high-priced executives that were convicted have been going to halfway houses. No bars, no fences, no cells. About 50% of inmates (?) in these ?prisons? are those convicted of financial crimes. Most of the others are drug addicts and single moms. They can even get weekend passes to visit their palatial estates. Attorney General Ashcroft wants them to get the maximum sentences is a regular jail, but a group called the Sentencing Commission wants a lenient standard. I don?t know who is behind this group, but it seems to be in line with my motto of ?follow the money?. The more money you steal the shorter the jail time will be.

We recently had Merrill Lynch and other major brokers fined $1.4 billion (yes, that?s a B) for their lying to stockholders by giving out false information generated by their ?analysts?, read salesmen. Not one penny of this is going to the people who were cheated and none of the brokerage company executives will get any jail time.

Almost none of the individual company executives have been ordered to make even partial restitution to stockholders. Unless something is done this lenient policy will go into effect in the first week in January. If you have lost any money in the stock market these past 3 years I think it would be a good idea to let your Congressman know that you want those bums kept in jail until they give back as much as they have stolen or at least until they are as broke as their shareholders.

Many will agree that the punishment should fit the crime. Letting them serve their terms in halfway houses without repayment is not my idea of that. Maybe Washington should hear from you.

Al Thomas

Author of \”If It Doesn\’t Go Up, Don\’t Buy It!\”

Never lose money in the stock market again.

http://www.mutualfundmagic.com

Writen By : Al Thomas

Tags: 401k, finances, funds, investments, ira, mutual funds, portfolios, retirement, retirement investments, stocks

Quick, look out the window. It?s raining. No, the sun?s out. No, it?s cloudy. Wait a second, it is changing again, but I can?t tell what it is going to do.

Kinds like the stock market. Up one day, down the next, then goes sideways. That stock I bought is not acting right. Maybe I should sell it, but I?ll wait another day. My broker (the weatherman) says it will go back up.

At the beginning of every year we hear stock market forecast (whether we want to or not) and every one of the ?experts? is about as accurate as our TV weatherman. Be sure to take your umbrella. Every year the Wall Street Journal surveys more than 50 economists and every year about 1/3rd of them are right. A weatherman can do better than that. The analysis of these birds seems impeccable and when you hear them speak so confidently you are sure they are right. He must be right ? he?s a broker/economist/financial planner and they know everything. Well, at least a lot more than I do ? maybe.

Having owned a brokerage company and hired about 300 brokers I can assure you they don?t know any more than you do. It just sounds that way. The one question you should always ask any broker before you give him your money is if he had a winning year last year. The market was down overall about 25%. If he lost more than 5% you don?t want to know him. And if he says he made a bundle you had better question him carefully and ask for proof.

For the last 3 years almost everyone lost money. But this year it will be different. My broker said so. Only once before did it ever go down 4 years in a row and the odds of it?s happening again are astronomical. Now that?s logic for you. If you want to know what the weather is you look out the window. This same logic goes for the stock market. It is going down except for brief periods. As long as the major trend continues it would be wise NOT to buy anything.

Now that President Bush has given us his ?stimulus? package and the Democrats have countered with theirs I wonder how long they are going to fight over how much and who gets what. It could be months before we see anything definitive from Washington. And that means you and I won?t be getting any relief until then.

Tell those guys in the Beltway that it?s raining and we need an umbrella ? NOW!

Al Thomas

Author of \”If It Doesn\’t Go Up, Don\’t Buy It!\”

Never lose money in the stock market again.

http://www.mutualfundmagic.com

Writen By : Al Thomas

Tags: 401k, finances, funds, investments, ira, mutual funds, portfolios, retirement, retirement investments, stocks