Turn Off Your TV!
All the financial networks are the same…
You have the never-ending ticker scrolling across the bottom of the screen while the pundits scream at each other. But they never seem to offer any specific ideas on how to profit from what they’re yelling about.
Here’s the truth: the mission of financial television isn’t to help you make money.
For most, the financial networks are simply a distraction from the discipline needed to be successful.
Infotainment on CNBC, Bloomberg, and Fox Business is big business as the major players raise the emotion to epic levels on even mundane market developments.
Think about it — when was the last time a TV contributor or guest told you what, when, and at what price to buy or sell?
Instead, all we see are “breaking news” alerts to keep viewers engaged and fearful that they will miss crucial developments. It makes sense. After all, the network needs your eyes glued to their advertisements in order to pay their bills — regardless of what’s happening in the markets.
News is often noise as it is more times than not factored into price. Unless the information is different than expectations, the impact on markets is minimal. But the networks will continue to build up every report as a can’t-miss event. Meanwhile, the talking heads talk their book or opine about ideology. Of course, those positions and politics should have little impact on any individual investment decision.
Then there are the incessant crash callers and their daily predictions of a market meltdown. Like guessing dates and places of earthquakes, calling market breakdowns is an equally inexact science. Yet this crash chatter always attracts unfounded attention — no matter how long the pundits have been dead wrong.
The solution? Turn off the TV!
The strength to tune out the financial network noise is often a function of confidence. An investor with a plan is not subject to the bulls, bears, dreamers or believers that are on our airways.
Discipline is key, and the ability to block out the never-ending nonsense and noise from the magic picture box.
Keep it In the Money,
Chart of the Day: The reality of the “round trip”
I think this might be the last installment of the GameStop short-squeeze saga.
The trade is dying – and I fear thousands of ill-informed speculators have lost everything. Yes, they might have enjoyed the paper profits as GME shares launched to gains north of 1,000% during the final weeks of January.
But this group of rogue traders became drunk on gains (and power!). Instead of taking money off the table, they convinced each other that they were on a crusade to stick it to the suits on Wall Street.
Sure, they might have disrupted a couple of hedge funds that poorly managed their risk. But I don’t think a majority of “the suits” felt much pain at all. The worst outcome for the Big Boys was the fact that many of them decided to raise some cash just in case they were squeezed out of other positions.
It’s not clear that they have weathered the storm. Meanwhile, the bag holders are probably looking at a round-trip move…
GME bounced Friday morning. But it’s clear this trade is well on its way to a total unwind… all the way back down into the 20s where it first started to squeeze last month.
I hope many speculators were able to at least take some profits along the way during the early days of the squeeze. But if not, they market has taught them some valuable lessons that you only get from the experience of losing everything…
— Greg Guenthner