Why you lose Money

harrytrader · Dec 27, 2003

The Wall Street Gang.
by Richard. Ney
http://www.amazon.com/exec/obidos/t...=glance&s=books

"I align myself with the specialist as he seeks to solve his inventory problems. The thrust of all my efforts is to buy when he buys and to sell when he sells."

"It is impossible to look solely at the tape as it passes in review and hope to determine longer-term trends in the market. One can understand the tape and decipher its code of communication only when experience is shaped through memory - or through the use of charts. â¦In the final analysis, we need both in order to make financially rational decisions"

"This is dangerous since the need to use existing investor techniques to mislead compels the specialist to change the trend in some way if he is to gain the element of surprise needed to make his manipulations "pay off." As he moves from one phase or price level to another, however, his inventory objectives begin to reveal themselves in terms of specific trends. "

"It is no accident that most investors lose money in the stock market. Their losses are an inevitable by-product of their ignorance of how little they know about the invisible world of the Stock Exchange. Like machines dominated by external influences, they are capable only of mechanical action.
Regrettably, the arrangements that exist to preserve the traditions and legalize the frauds of the security industry are inseparable from the general organization of a society controlled by the financial establishment, a society whose laws and principal customs have been contrived to serve the special interests of the financial community. Thus, although the Stock Exchange's most profitable practices clearly compromise the freedoms granted others by the constitution, Exchange Insiders are granted immunity from the legal obligations and penalties that should be imposed on them."

ig0r · Dec 27, 2003

Quote from harrytrader:

The Wall Street Gang.
by Richard. Ney
http://www.amazon.com/exec/obidos/t...=glance&s=books

"I align myself with the specialist as he seeks to solve his inventory problems. The thrust of all my efforts is to buy when he buys and to sell when he sells."

"It is impossible to look solely at the tape as it passes in review and hope to determine longer-term trends in the market. One can understand the tape and decipher its code of communication only when experience is shaped through memory - or through the use of charts. â¦In the final analysis, we need both in order to make financially rational decisions"

"This is dangerous since the need to use existing investor techniques to mislead compels the specialist to change the trend in some way if he is to gain the element of surprise needed to make his manipulations "pay off." As he moves from one phase or price level to another, however, his inventory objectives begin to reveal themselves in terms of specific trends. "

"It is no accident that most investors lose money in the stock market. Their losses are an inevitable by-product of their ignorance of how little they know about the invisible world of the Stock Exchange. Like machines dominated by external influences, they are capable only of mechanical action.
Regrettably, the arrangements that exist to preserve the traditions and legalize the frauds of the security industry are inseparable from the general organization of a society controlled by the financial establishment, a society whose laws and principal customs have been contrived to serve the special interests of the financial community. Thus, although the Stock Exchange's most profitable practices clearly compromise the freedoms granted others by the constitution, Exchange Insiders are granted immunity from the legal obligations and penalties that should be imposed on them."

Do you think NYSE will be getting rid of specialists anytime soon? Do you think they will be replaced by something just as manipulative? How will the character of the NYSE markets change by the removal of specialists? Lookin for views

harrytrader · Dec 27, 2003

They don't need NYSE Specialists anymore thanks to Electronic Market: with electronic manipulation is much easier ... and above all more invisible

. In fact Maurice Allais, economic Nobel Prize has already said that it is thanks to real time that market manipulation is possible. Nevertheless don't worry for the specialists pretty sure they will just change their names into something else

. It is just Marketing Hype as usual when they change regulation it's apparently for the public health but behind it is worse see for example http://www.elitetrader.com/vb/showthread.php?s=&threadid=26104&perpage=6&pagenumber=3

Michael Lewis , whose books include "Liar's Poker," "The New New Thing" and "MoneyBall," is a columnist for Bloomberg News. The opinions expressed are his own.

http://quote.bloomberg.com/apps/new...columnist_lewis

"Echo of Analysts

Enter the regulators, and their post-bubble zeal. If one consequence of the mutual-fund scandal is to drive small investors away from their faith in mutual-fund stock pickers, some good might come of it.

But that isn't likely. What's likely is that the scandal will leave ordinary investors with the impression that the main trouble with their financial institutions is that they are dishonest.

In this respect, the mutual-fund scandal resembles the (phony) Wall Street analyst scandal: It is likely to create the illusion of reform rather than the genuine article.

The settlement with Wall Street firms over their analysts' exuberance for Internet stocks created the illusion that Wall Street research, once tainted by self-interest, is now ``objective'' and therefore reliable. But you'd be as much of a fool to follow Wall Street stock-picking advice today as you would have been three years ago -- and as likely to come out of it well.

The mutual-fund scandal will have the beneficial effect of scaring the bejesus out of mutual-fund managers who survive it. But it won't make them meaningfully more likely to invest capital wisely.

Just the reverse: Larded with even more regulation, more legal costs, more cover-your-butt provisions, mutual funds will see their costs rise. The added costs will be passed along to investors. Mutual-fund returns will be even less likely to justify fees. "

Quote from ig0r:

Do you think NYSE will be getting rid of specialists anytime soon? Do you think they will be replaced by something just as manipulative? How will the character of the NYSE markets change by the removal of specialists? Lookin for views

harrytrader · Dec 27, 2003

Now as speculator this is the game, you have to accept it or it's better not to be a speculator, this is even where the fun is

. On the other hand I think also about all the mass public that will retire (including you and me) ... when their money will have already being pumped. At the moment they substitute real money with more and more credits which are used as sponge, when the sponge will have finished to absorb the real money the dirty and fake money that is credits will then appear under its ugly face and impact real economy.

Quote from harrytrader:

They don't need NYSE Specialists anymore thanks to Electronic Market: with electronic manipulation is much easier ... and above all more invisible . In fact Maurice Allais, economic Nobel Prize has already said that it is thanks to real time that market manipulation is possible. Nevertheless don't worry for the specialists pretty sure they will just change their names into something else . It is just Marketing Hype as usual when they change regulation it's apparently for the public health but behind it is worse see for example http://www.elitetrader.com/vb/showthread.php?s=&threadid=26104&perpage=6&pagenumber=3

Michael Lewis , whose books include "Liar's Poker," "The New New Thing" and "MoneyBall," is a columnist for Bloomberg News. The opinions expressed are his own.

http://quote.bloomberg.com/apps/new...columnist_lewis

"Echo of Analysts

Enter the regulators, and their post-bubble zeal. If one consequence of the mutual-fund scandal is to drive small investors away from their faith in mutual-fund stock pickers, some good might come of it.

But that isn't likely. What's likely is that the scandal will leave ordinary investors with the impression that the main trouble with their financial institutions is that they are dishonest.

In this respect, the mutual-fund scandal resembles the (phony) Wall Street analyst scandal: It is likely to create the illusion of reform rather than the genuine article.

The settlement with Wall Street firms over their analysts' exuberance for Internet stocks created the illusion that Wall Street research, once tainted by self-interest, is now ``objective'' and therefore reliable. But you'd be as much of a fool to follow Wall Street stock-picking advice today as you would have been three years ago -- and as likely to come out of it well.

The mutual-fund scandal will have the beneficial effect of scaring the bejesus out of mutual-fund managers who survive it. But it won't make them meaningfully more likely to invest capital wisely.

Just the reverse: Larded with even more regulation, more legal costs, more cover-your-butt provisions, mutual funds will see their costs rise. The added costs will be passed along to investors. Mutual-fund returns will be even less likely to justify fees. "