I Eat Bear

Well, if you are expecting a blog about a specific stock, you will get one (and it will be short), but, it will be at the end.

Not the purpose of this one.

OK, for some of you, I am going to whine. Or am I? No, I am going to state the obvious.

If you don't OWN a stock, you should not be allowed to trade it.

Yes, that simple change, could do much to improve the markets.

Ok, for every rule, there is an exception. So, let me cover the one I see, that is most obvious.
Some businesses do need to hedge. Those businesses truly do intend to buy the resource they hedge in. If not at that price, at some price. Yes, much of this concept deals with commodities. Unfortunately, some fool got the idea, it should apply to most stocks too.

So, not only do we have futures trading, we now have options trading on many, too many stocks. No longer do you have to OWN a stock, or have INTENTION to buy the stock, or product, but GAMBLING, has become KING!

Yes, the market today, is NOT about OWNING a stock. It is about selling it short, or buying an option, which you never intend to fulfill anyway.

OK, I favor, the great American system of making money. This has gone too far.

We have hedge funds, that have accumulated vast amounts of cash, and as such, enough stocks to affect price. Was that EVER the INTENT of owning a SPECIFIC stock? Do they have that RIGHT? To some degree maybe, but that right is now being abused.

We have financial institutions, that issue stocks for businesses, and for doing that, get several thousand shares in return? The cost of doing business? Or, is it legal RAPE?
(Yes, grab your ankles for these folks)

First, get the attention of your congress person. Have them stop, in all forms, people that do not own stocks, from making trades in them. Yes, there still should be some "futures" trading, but have them REGISTER, and have them PROVE, they have an INTENT to recieve the item being bought.

Sound absurd? I bet that one change ALONE, would DOUBLE your portfolio,,, within a year.
We might actually go back to prices based on company performance.

And, another recent joke, I found not so funny. The AVERAGE ANALYST is right 6% of the time. And they, control stock prices? Not alone they don't. They need MEDIA support. And, there is another group, that should be hiding heads in shame. They instill PANIC, as they have learned, the public responds more to BAD news.

People, you MUST, put all of this out of your mind. In the long term, good companies, good stocks, and good earnings,,,, can and will,,,,, and MUST prevail.

If we all have to have a congressional revolt,,, well, so be it. Most of them should be unemployed anyway, and I wish that on nobody.

And, if you are an options trader, or a futures trader, I can only say one thing. I don't know when it will happen, but, you will get burnt, and I suspect badly. You too, should be praying for government reform, before you too, pay your come upance. You robbed, stole, and got away with it. But, there is a GOD. With a WICKED, sense of humor. And, you will be tested.

Ok, enough gloom and doom, I promised you a good stock pick,,, and YES, in this market.
Once again, I advise TNH. Terra Nitrogen. The dividend, is too good, especially in this market, to be ignored. Everyone is looking for a safe place, and this is one of the best. Not only do I look for a good dividend, I expect the flight to safety of the rest of the market, to make a significant stock price gains too. And, it is a sound company, in a good market segment (ag)..

So, for the short term, buy TNH. Then waste your time, and write a congressperson. I am not saying it will work. I expect them to IGNORE your request,,,, unless you include several hundred thousand dollars with it. That is what they do. But, it is OUR system, and until we have a better one, it will have to do.

But, we can all dream. If you OWN a stock, well, you take it with it's ups and downs. Do people that NEVER intend to own, have a right to impact ANYTHING about that stock?

And,, good luck, and good investing. Buy TNH,,, not because I own it,,,, and I do,,, but because YOU need to too!

Comments: View Comments |  Saturday September 6, 2008