You Can Profit From the Current Economy
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The current economy is in bad shape – at least that’s what all of the pundits tell us. The conventional wisdom in times like these is to put stop loss orders on everything, put everything you can into blue chips, or settle for the safe, low returns of Treasury securities.
I’m here to tell you that the conventional wisdom is foolish.
In the first place, the conventional wisdom is contradictory. You can’t have automatic trades to comply with stop loss orders going on constantly and maintain major holdings in blue chips. Even the blue chips – maybe especially the blue chips – are subject to market volatility. When the economy is bad, inflation becomes a major concern, and the market starts requiring a higher return on investment. At the same time, the bad economy drives sales downward, reducing corporate incomes and, by extension, return on stockholders’ investment. The result is market dissonance that exacerbates existing
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