# Invest or Game Play ?



## lonewolf (Jun 12, 2012)

There can only be one best of anything. To make money in the market is it best to view the market as a game or an investment.

Should the name of this forum be changed to game playing from investing ? The majority gets it wrong when it comes to the market, the majority view it as investing.


I just love this game it allows me to come in contact with that which I value more then money i.e., courage, independent thinking, truth,honesty, confidence.


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## james4beach (Nov 15, 2012)

I agree that investing is hard to distinguish from speculating. Just about everything one does here is speculative. Additionally, the actions of central banks (particularly Greenspan and Bernanke policies) have further pushed every average investor towards being a speculator. Bernanke _wants_ average investors to chase yield, buy over-priced assets, and fear high inflation.

But even leaving aside the horrendous manipulation of the 'investment' landscape by Bernanke, everything is still a speculation.

For instance, buy & hold the stock index? You're gambling that stocks aren't dramatically overvalued, and you're gambling that they will go up long term and not act like Japan.

Hold cash or fixed income? You're gambling that there won't be high inflation in the coming years, or you're gambling on deflation happening.

Invest in "high quality dividend paying stocks"? My favourite ... so widespread on these forums ... you're gambling that it's safe to treat highly volatile equities as some kind of pseudo-bond. You're gambling that volatility stays low, that interest rates stay low, that corporate earnings can support current dividend levels, and that dividend paying stocks aren't overvalued due to the hype of dividends under Bernanke's ZIRP.

There's a more broad theme in current markets. *It's pretty clear now that stocks, bonds, and commodities only rise and fall with expectations that the central bank will print money*. Wow, what a basis for investment! Buying the stock index, or just about anything, has really become a gamble on whether the central bank will keep pumping money into markets and levitating prices. Pure speculation, all of it.


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## dogcom (May 23, 2009)

I agree with the above first of all.

For sure the markets are all about playing a game set up by the Fed, central banks everywhere else and big money players. They know the direction things will go and will direct or extract the cash of the masses so they can buy or sell to the preconceived market direction. Some would say the Fed is rigging the game to recapitalize the banks and have the bail-in conditions in place in case it fails. 

The market is no longer run on fundamentals but instead by technical analysis, central banks, computer trading, massive use of derivatives and so on.


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## lonewolf (Jun 12, 2012)

Hi, James4beach

From your posts you post I get the impression you are wise & have strong understanding it is best in the long run to reduce gambling by lowering risk to put the odds in ones favour for ending up with more money.

I think it was 1980 + or - a year (would have to check chart) that inflation was high & gold topped out @ an important high. Was it expectation of future inflation that topped it out ? The inflation did not keep up with the expectation of the future inflation aprox 20 years latter which might be why gold was lower years latter.


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## dogcom (May 23, 2009)

Lonewolf Volcker shot interest rates and the cost of money so high that it broke the back of inflation. I don't believe the gold market at the time thought they could do such a thing and was caught extremely overpriced.


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## lonewolf (Jun 12, 2012)

Dogcom my friend

The identity of an entity must act in accordance with its nature & can not act other wise i.e., a thing is what it is & can not be something differnt @ the same time & in the same respect.

If the fed thinks it can change the nature of the market perhaps it is an egotistical pig ?

The laws of nature remain constant, through understanding man can harness thier power & use them to his benifit. The fed can not change the laws of nature. When the dow touches the upper line of the jaws of death pattern perhaps kisses it a few times it is check mate for the powers that be. The fed is just part of the structure of the exsistance that exsists & is not more powerfull to control exsistance that exsists.

Does anyone really believe the fed is more powerfull then mass physoclogy ? Well Iam like the little boy that saw the emporer with no clothes on & I see what I see not that which the herd sees. Galelio used his own telescope i.e., his own eyes


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## dogcom (May 23, 2009)

The Fed can't change the laws of nature forever, but with the help of the printing presses and big friends who own the media they can do a lot. They have kept this thing afloat since 2009 so they can affect things for a long time, but not forever.


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## Echo (Apr 1, 2011)

We can't predict the future, but we can look to the past for reasonable assurance of how best to grow our savings (rather than stuffing it under your mattress).

http://www.getsmarteraboutmoney.ca/...esting-chart/interactive-investing-chart.html


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## Belguy (May 24, 2010)

When all is said and done, which of the following retirement plans do you find the most realistic?

A: A RRSP invested in equities

B: Government Pensions

C: The lottery or Texas Hold'em


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## none (Jan 15, 2013)

Echo said:


> We can't predict the future, but we can look to the past for reasonable assurance of how best to grow our savings (rather than stuffing it under your mattress).
> 
> http://www.getsmarteraboutmoney.ca/...esting-chart/interactive-investing-chart.html


I think you just contradicted yourself.


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## dogcom (May 23, 2009)

The mattress is of course the worst place because of inflation and robbers. Of course the Fed is the same thing but at least there is the chance to beat inflation and the Fed usually will rob you over time rather then right away like a robber.

The past doesn't tell us everything is fine either as there were depressions, hyper inflations and all sorts of disasters all over the world.


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## Belguy (May 24, 2010)

Oh yes, and market crashes from which it could take years to recover.:hopelessness::cower::eek2::grief:


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## james4beach (Nov 15, 2012)

Markets do seem to crash surprisingly often ... 2000, 2008, then flash crash of 2010

@lonewolf: gold topped when Volcker at the Fed surprised everyone by actually fighting inflation with high interest rates. The period of high interest rates that followed probably flushed out all the inflation, and excesses, and set up America for one of the greatest bull runs in the world's history.

Unfortunately such a thing would be impossible for the Federal Reserve today, because both consumers and government are totally dependent on low interest rates. Raising rates is off the table, because it would bankrupt all consumers and also bankrupt the USA due to the cost to finance its debt.


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## lonewolf (Jun 12, 2012)

James

Does it really matter that consumers & goverment are dependent on low interest rates for interest rates to stay low ? 
Who has the power the market or the fed ? If the market has the power it does not matter what the fed wants, If the markets demand higher rates it will get them. 

Volker did he just simply raise interest rates as interest rates rose as baby boomers felt confident & borrowed money to buy homes. The baby boomers are past thier peak spending years & dont want take on debt as they get ready for retirement.

Then their is another view it is just cycles & there can be a bogus fundamental reason for interest rates to rise or fall. The 30 year cycle has bottomed or close to it so perhaps the fundamental reason will be higher rates for increased risk as interest rates rise.


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## james4beach (Nov 15, 2012)

OK you're right that bond market interest rates are going to do their own thing, whether the Federal Reserve wants it or not. I agree that if the market demands higher rates, it's going to happen.

The overnight fed funds rate / Bank of Canada rate is the one they will keep low.


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## Rusty O'Toole (Feb 1, 2012)

There are a million guys who regard the stock market as a game and play to win. Out of the million,there will be about 10 who end up rich (without cheating) and a few thousand more ( the .1%) who win by cheating.

There are a few hundred guys who regard the stock market as a place to shop for bargains. Their leader is Warren Buffet who defines his investment philosophy as buying dollar bills for 50 cents. Practically all of them do well, and make above average returns with low risk. Buffet himself has said that he doesn't know anybody who has lost a significant amount of money over time, following the value stock philosophy.

This is no secret. What I just wrote has been common knowledge since the 70s if not earlier. So why does everyone thrill to the idea of grabbing a zippy micro cap and watching it go to the moon while buying a big old grandaddy company with billions in the bank for half price is a snooze. Go figure human nature.

What I am driving at is this. If you regard the stock market as an arena where you are competing to beat the other guy's brains out and stack the biggest pile of cash you are sure to lose. Even if you are the one in a million with hot dice you still lose because there is always somebody else with a bigger stack.

But if you regard it as a market where you buy investments, and where sometimes they are very cheap and sometimes they are very expensive, you will not only make more money you will sleep better as well.


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## dogcom (May 23, 2009)

What is value? It is hard for us to really know unless we do a lot of homework. Many times value is best left to the experts on value or bargains to sniff it out for us. Even then it takes a lot of patience and continued paper losses before the value is realized. 

Many times what looks like true value or a bargain is really a bunch of crap and lies dished out by executives or CEO's until the wheels really come off the cart.


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## richard (Jun 20, 2013)

If you mean looking at the market as a game in a casino, I'm not into that although I know some are. There are some great comments above that explain why.

If you mean not getting upset when the market goes down, then I fully buy into that. That's partly because I've arranged things so it's not a disaster for me if the market doesn't rise in the short term, and partly because the future is a very long time for most of us and we don't exactly know what will happen next. If you have that mindset and you enjoy watching things moving around, then it is like a game


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## lonewolf (Jun 12, 2012)

I think all investing is based on value investing. (not everyone has same values) It is best done with a powerfull mind that understands that which is thinking so one sows that which they love.

Emotions are automated "VALUE" responses issued by the subconscious with in the contect of an individual knowledge is "for" or "against him." 
The mind is so constituted it can not keep all of its knowledge in its focal awareness yet in order to survive it must be able to make instantanious apprasials without any lengthy thought process i.e., if a pedestrian precieves a truck traveling @ break next speeds in his direction rather thern carry out a lengthy thought process, the subconscious provides the conscious mind with lightening quick apprasial causing the pedestrian to lung to safety well by passing any lengthy thought process.

Every emotion has a kenetic element. Love is an emotional response to that which one "VALUES" most highly. It causes one to act to come in contact or possesion of that which they "VALUE"

Fear on the other hand is an emotional response to that which treatens ones values & causes action to avoid that which causes the fear.



If the pedestrians mind has a junk heap of invalid theories one of them thinking a truck could run him over & not effect that which he values his life or if he valued death over life he would not lung to safety.

A strong commitment to reason builds a powerfull weapon (mind) to come in contact with that which it values. Emotions are not the enemy when investing but are a friend of those with a powerfull mind built on concepts based in truth & a strong value system.

Understanding the function of emotions & values have on investing helps to build a powerfull mind that accepts the truth as their friend.


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## lonewolf (Jun 12, 2012)

If you mean not getting upset when the market goes down, then I fully buy into that. That's partly because I've arranged things so it's not a disaster for me if the market doesn't rise in the short term, and partly because the future is a very long time for most of us and we don't exactly know what will happen next. If you have that mindset and you enjoy watching things moving around, then it is like a game [/QUOTE]

Hi, Richard

The only way I have found to not get upset when the market goes down is to hedge instead of speculate. There is a reason the commercials beats the pants of the speculators.

Fear will cause one to sell if selling is a emotional response to that which threatens that which one values.

The way to eliminate this is simple program your method so buying, selling, holding is based on fear this is done by developing a method that gives the investor an edge & not following the method would cause more fear then following the method because the method hedges or protects that which one values. Since no method is perfect bet size must be kept small enough so if bet blows up it does not put the system @ risk


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## Eclectic12 (Oct 20, 2010)

lonewolf said:


> There can only be one best of anything. To make money in the market is it best to view the market as a game or an investment.


Is being the best in one way required?

To use an analogy - one does not have to be the best auto mechanic, accounts payable specialist and marketing person to have a successful/profitable garage business.

The goal is to make money so as long as one knows enough to limit their risks & avoid the worst of mistakes - IMO, there are many different ways. I've made money using value, long term, leverage, short term swings etc. I still have options to learn about. Learning new ways & identifying when plus how to use them keeps it interesting.




lonewolf said:


> Should the name of this forum be changed to game playing from investing ? The majority gets it wrong when it comes to the market, the majority view it as investing.


I suspect that based on what the individual is doing, some have it right, some are so/so and some are wrong.


Cheers


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## Belguy (May 24, 2010)

Isn't investing a long term proposition while active trading could be considered more like game playing?


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## dogcom (May 23, 2009)

Lonewolf I would like to ask you about the extreme gold and silver manipulation and when the laws of nature will topple the Fed in this matter or help the Fed as it takes the gold from weak hands onto itself or its bankster friends. We all know that physical gold is in a extreme bull market of buying that doesn't in any way reflect the paper bear market. We also know that huge volumes are sold at the worst time in asian trading something any normal person would never do if they wanted the best price possible for their position. This was the best example of manipulation I could think of and I am interested in your comments here.


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## lonewolf (Jun 12, 2012)

dogcom

From experience you have differnt knowledge & understanding then me as I have differnt knowledge & understanding then you. It is best to see the world through your own eyes.

This is my understanding which will be distorted if we put differnt meaning into words & or there are no words to explain.

Mans biological distinguihable trait is reason ( ability to think using senory evidence) The fed are men & thier only weapon is thier mind if they fail to stay true to thier nature they will fail. I stay true to my biological distinguihable trait "reason" by using "commitment to reason" as my standard for gauging my esteam. Esteam is a value judgement (it is best to use an appropriate standard for gauging esteam which from experience is mans bilogical distinguihable trait "reason") which is an omni present physcological need in everyone. It entails that one is committed to that which is true, good capeable & worthy of living.

The fed has no mystical powers, The mood of the masses can bend the thinking of the most advanced of intellect. It does not matter how much knowledge or how intelligent the fed is. It will be thier commitment to reason that matters.

The fed I think is also a bull market figure. The mood of the masses wll obliviate the fed when the mood & or time is right. Just like certain music, art, movies styles are popular @ differnt points as the masses swing back & forth between optimism & pessimism @ differnt degrees. So will the mood of having a fed & not having the fed & or the amount of faith people will put into the fed. (I try to have no faith which is the antithisis of reason the blind accaptance of ideas without any sensory evidence)

The fed does not dictate the masses, the masses dictate when the fed will & will not exsist. 

As for gold the 9yr cycle last bottomed in 08 & has always topped in the 3rd or 4th year of the 9 year cycle except the last 9 year cycle. The odds based on cycles have gold in a bear market till the bottom of the 9 yr cycle.


On gold seek radio a year or so ago they tried to sell a once gold coin to the puplic for $5 @ a beach & noone would buy it because everyone thought it was not real.

If the currencies fall apart those holding gold could be taxed to death. Maybe holding some in Switzerland might be valuable @ some point. For barter I think the old silver coins are a little more practical then gold would be more transactions could be made & might be more recognizable then chunks of gold.

check out equity clock for some plays on gold stocks in the Sept maybe a little bit of August time period. cant think of the names of 2 that are a good play.


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## lonewolf (Jun 12, 2012)

Eclectic12 said:


> Is being the best in one way required?
> 
> In a poker game the money will work its way to the strongest player.


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## Eclectic12 (Oct 20, 2010)

^^^^

... which suggests the label of "game" is not appropriate as the poker game is not a good analogy. 

For the poker game, there's only one winner per game. 

For the market, the individual investor can win, lose or breakeven & the next investor to buy the same investment can have a completely different result. 

Further - for the individual investor, there can be many different results for a given investment (ex. make money on RIM four times, lose a fraction of the total on RIM once for a net gain).


Cheers


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## cannew (Jun 19, 2011)

Belguy said:


> Isn't investing a long term proposition while active trading could be considered more like game playing?


Fully agree! Find good companies with a long history of returning a share of their earnings to their shareholders. They may not provide the best possible gains, but they have demonstrated they can manage good and bad times. Slow and steady usually wins the race or at least finish close to the top.


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## dogcom (May 23, 2009)

Thanks lonewolf I do believe in cycles and the Fed would naturally find its way into the position it finds itself and will do short term things to delay or to help the banks until it can do no more. Printing money, squeezing the shorts, using the media, language, busting stops and trading at times when the market volume is low are some of the many tools it will use to buy time. I know it doesn't directly use all these tools but it has entities to do just that.


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## Belguy (May 24, 2010)

This might be of interest to some:

http://pragcap.com/is-the-stock-market-a-zero-sum-game

Also, by Googling 'the stock market game', I note that there are some on-line investing games for your entertainment.

Let us know if you come across a good one.


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## gibor365 (Apr 1, 2011)

Belguy said:


> This might be of interest to some:
> 
> http://pragcap.com/is-the-stock-market-a-zero-sum-game
> 
> ...


Actually it will be interesting to do online swing/day trading with virtual money....similar to roulette, but more interesting....
even though, when I play roulette (or blackjack) online with virtual money, I usually win...with real money in casino - mostly lose 

googled what you mention, http://www.wallstreetsurvivor.com/play/portfolio looks interesting


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## Belguy (May 24, 2010)

At the half way point in the year, the TSX Composite Index is down 2.45%.:upset::frown::eek2::grumpy:

Also, is everyone aware of this website:

http://www.etfinsight.ca/


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## lonewolf (Jun 12, 2012)

As for gold the 9yr cycle last bottomed in 08 & has always topped in the 3rd or 4th year of the 9 year cycle except the last 9 year cycle. The odds based on cycles have gold in a bear market till the bottom of the 9 yr cycle.

I made a mistake in wording the above. There is a 9 year cycle in gold that consists of nine seasonal cycles (not fixed cycles but streatch & contract a little) It is the top of the 3rd or 4th seasonal cycle that has been the top of the 9 year cycle except to the 9 year cycle prior to the one started in 08



For barter I think the old silver coins are a little more practical then gold would be more transactions could be made & might be more recognizable then chunks of gold.

The silver coins I meant were the ones that were not 100% silver but had silver in them & were used in the coins made in Canada & the united States something like 45 years ago often refured to as junk silver coins.


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## lonewolf (Jun 12, 2012)

gibor said:


> Actually it will be interesting to do online swing/day trading with virtual money....similar to roulette, but more interesting....
> even though, when I play roulette (or blackjack) online with virtual money, I usually win...with real money in casino - mostly lose
> 
> googled what you mention, http://www.wallstreetsurvivor.com/play/portfolio looks interesting



There is a big difference from paper trading & putting money on the table.
On Wii you can be a star baseball player. with 2 out get dropped down to bat in the 7th game of the secound half of the 9th inning of the world series bases loaded with your team losing by 3 points with 70,000 beer soaked fans yelling your a bum a bum. Do you kinda a think there might be a little difference.

market tuition costs a little more then paper trading. Paper trading can actualy make a trader over confidence in thier ability to play the real game when money is on the table.

Who is right in the debate ?
A) those that say it is best to paper trade for practice
B) never paper trade to avoid playing a virtual game instead of the real thing?

Iam on the side of never learning to paper trade.


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## richard (Jun 20, 2013)

lonewolf said:


> The way to eliminate this is simple program your method so buying, selling, holding is based on fear this is done by developing a method that gives the investor an edge & not following the method would cause more fear then following the method because the method hedges or protects that which one values. Since no method is perfect bet size must be kept small enough so if bet blows up it does not put the system @ risk


That's a great observation. I have a method, which is buying broad indexes when they are cheap. Thus there are only two things that terrify me: buying individual stocks / active mutual funds, and prices rising before I buy. I can only control one of those so I avoid it entirely. It's worked great for me.


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## richard (Jun 20, 2013)

Belguy said:


> At the half way point in the year, the TSX Composite Index is down 2.45%.
> 
> Also, is everyone aware of this website:
> 
> http://www.etfinsight.ca/


Never heard of it, but it looks like one of those sites with articles on "the 6 best ETFs for the second half of 2013". In other words, if you like what they're saying you'll probably want to hear this hot tip about penny stocks too


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## Rusty O'Toole (Feb 1, 2012)

2 things prevented me from looking at that site: winky blinky flashy washy pictures and acronyms. Closed the window in 5 seconds, and am confident I didn't miss anything of value.


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## lonewolf (Jun 12, 2012)

Rusty

By not looking @ the site you never lost anything of value i.e., being strong independent & not joining the herd.

History has shown your moving average system has a good track record.


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## lonewolf (Jun 12, 2012)

How do the computer wizards on this site box in more then one qoute & keep the qoutes seperate ?

In post # 32 I wanted to box in 2 seperate portions of my earlier post. When I have only one quote I want to reproduce then reply. I can get it to come up without box but @ least it says quote. Would be nice to box it though. When I do more then one qoute & eliminate the rest of the post I get no qoute or box come up. If it is a simple procedure how do I get more then one qoute to come up that is boxed


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## CanadianCapitalist (Mar 31, 2009)

lonewolf said:


> How do the computer wizards on this site box in more then one qoute & keep the qoutes seperate ?


Click on the Multi-Quote This Message icon to the right of "Reply with Quote" to quote multiple messages.


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## lonewolf (Jun 12, 2012)

Canadian capitalist

Your a good man, thanks for the info


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