We were back on Federal Reserve watch today, as investors waited
for commentary from the two-day meeting this afternoon. The market
was certainly content with the message as chairman Ben Bernanke
stuck to his "do whatever it takes" stance on spurring the economy.
With that, the indices gained back a bit of yesterday's big
Quite a few earnings reports this morning affected big-name
stocks. MasterCard (
jumped higher on its strong earnings beat this
. The company's dividend yield is minimal, so the stock is only
suited for the most aggressive investors. The credit card giant
also helped competitors' shares move up, including Visa (
), American Express (
), and Capital One Financial (
Also trading higher on earnings results were shares of EOG
), Pioneer Natural Resources (
), and CF Industries (
). Again, these are all high-beta low-dividend-yield stocks that
tend to be bought by active traders.
A couple of stocks did move lower following disappointing
earnings results, including Time Warner (
) and Molson Coors (
The Cowboy Mentality and Wall Street
The MF Global debacle continues to unfold, as news broke
yesterday that the firm cannot account for a good portion of
clients' money. Apparently, the firm had been co-mingling client
funds along with its own assets, which is a big no-no. As of Aug.
31, the firm had $7.3 billion in customer assets and was the
eighth-largest U.S. futures broker, sporting a big presence in
commodity markets worldwide.
I've often talked about how dangerous commodity, currency, and
futures markets can be, despite the numerous commercials
glamorizing how sexy and profitable those markets supposedly are.
This kind of trading is the height of gambling in the financial
markets, but yet, many are lured into it, despite the velocity of
how things can turn against one's positions.
MF Global had employed around 3,000 people according to the
latest reports. With the company declaring bankruptcy, it's a near
certainty that most of those jobs will disappear.
These headlines will not do anything to ease the tension on Wall
Street, which has been targeted recently by citizen protests. Much
of the public continues to wonder what exactly the big Wall Street
firms are contributing to the overall economy. Hundreds of billions
in bailouts have undoubtedly been damaging not only to the economy,
but to the overall sentiment of investors.
Regardless of how much money you have, your best strategy is to
keep your investment style as simple as possible. Remember, the
more complex you make your investments, the greater the odds you
And be careful who you trust when it comes to your money. How
many athletes and celebrities have been scammed into bad
investments in recent years? As I always say, no one will ever take
better care of your money than you. If you keep things simple,
you'll be well-positioned for solid returns - and be able to sleep
Reaching the Pinnacle
I recently watched a clip of former NBA star and "bad boy"
Dennis Rodman's Hall of Fame Induction speech. It had the usual
thank-you's and props to his former teammates and coaches. But
things took a bit of a turn when he reflected on his road of
His wife and kids were in attendance with him. Many may not have
even realized he'd been married with children for many years,
considering how frequently he'd been featured in tabloids, which
reported alleged affairs with many well-known celebrities. As
Rodman stood at the podium, it was easy to see the weight of his
confession that he wasn't exactly the best husband or father. He
even admitted to hating his mom (who was also in the audience) for
being as tough as she was on him, but that he was understanding and
grateful for her sacrifices in working and raising the family on
her own. Many of us will never be in such a public spotlight, but
many will travel a rocky road to attain the success we always
In our desire to reach our own mountain top, let us keep in mind
the actions we take will always remain as evidence of how we got
there. Having those special people in our lives to reflect with
later in life will be what you remember the most. In Mr. Rodman's
case, his family was there by his side to in a sense forgive his
past transgressions, and pay honor to someone who did reach the
hardest of accolades in sports, induction into the Hall of
I have often heard stories about hospice nurses that have
listened to many regrets from those that are dying. The two biggest
takeaways from those stories were regretting not having the courage
to go after their dreams, and more importantly, understanding that
happiness is a choice. Remember these things as you think about
where you are in your life. You can often control your own destiny
more than you think.
We can all fuss about the size of our bank accounts, our job
that is making us miserable, or whatever else that could be holding
us back. Or, we can make the changes necessary to improve our
"luck." Ultimately, your current luck in life is built upon the
actions you've taken long before.
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Thanks for reading everybody. I'll see you tomorrow!
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