Here are excerpts from the memo I sent to clients this evening. It's a summary of the market so far this year and some possibilities going forward: I am very pleased that we survived the first 2 weeks of 2016 with our heavy cash position. The first week of January was the worst 5-day start in the history of the stock market. I was expecting some form of a bounce during the second week, however, the warning signs continued to [...]

I received several emails over the weekend from people who are really struggling and panicking about this market. This is not the end of the world. This a correction, plain and simple! The biggest challenge most people are having with their investments is: Should I just leave everything alone? Or should I cash some out? The reality is that people want the best of both worlds, and that is not very realistic. In other words, [...]

The stock market is a master manipulator. It conditions us to think a certain way over and over and over until we are convinced of a pattern. Then, just when we think we have things figured out, the market magically changes character. Keep in mind that a pattern can continue for a long time before the market eventually changes. The reason I bring this up is because something very interesting happened last week. For the [...]

“In 1923, seven men who had made it to the top of the financial success pyramid met together at the Edgewater Hotel in Chicago. Collectively, they controlled more wealth than the entire United States Treasury, and for years the media had held them up as examples of success. Who were they? Charles M. Schwab, president of the world’s largest steel company; Arthur Cutten, the greatest wheat speculator of his day; Richard Whitney, president of the [...]

I get emails all the time from readers of my blog, but something very interesting happened last week. I received 5 emails in a row all having the same theme: FEAR. Random people wrote to me saying: "I'm horrified of this market," "I'm scared that my stocks will collapse," "How do I overcome my fear?" etc. etc. I would like to discuss what creates this fear and how to possibly overcome it, but first I [...]

One concept many traders struggle with is that their ENTIRE account doesn't have to be invested at ALL times. There are times (like the correction we're going through now) when you should have at least some of your money in cash in order to protect capital and to protect confidence. 1) One of the main reasons I keep a larger than normal cash position during corrective markets is that 4 out of 5 stocks move [...]