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There are a zillion different ways people use
to try and buy and sell stocks at a profit. I want to begin
here by explaining to you two of them that are as opposite as
opposites can be. What I'm talking about is people who invest
for the long term and people who are extremely
short term investors.

Long
Term Investors: These people, in my opinion, have got to
be almost brain dead. Let's say you want to assemble a nice
portfolio of solid, blue chip stocks that... 20 years from
now... you can cash in to pay for your child's college
education. How could you even begin to make an intelligent
selection of companies to…

Do you realize how different the world is now
from what it was 20 years ago? Or 10 years ago? Or 6 months
ago? Or, how much the world has changed just since yesterday?

Ten years ago, the most coveted piece of
office equipment in the world was an IBM Selectric Typewriter.
Nowadays, you couldn't give them away as…

Speaking of IBM, for years it was thought of
as the bluest of the blue chips. In January of 1987 you could
have bought it for around $87.00 a share. Six and a half years
later, in June of 1993, it was down to under $20.00. That must
have been a gut-wrenching feeling for all those long…

Today, you can buy IBM for about $104.00 per
share. So, I guess it's a "safe" blue chip again,
right? Heck, IBM's heavy into technology and... since
technology changes so slowly these days... how could it
now drop to $20.00 like it did five years ago... or... even
fall to $43.00 like where it was…

BUT, KNOW THIS: Things are not just
changing fast now, they are changing almost at the speed of
light. Making ANY long term investment in the stock market is
truly a "sucker's play."

Who could have predicted Russia would now be a
capitalist country? Would, 10 years ago, you have ever
believed network television would broadcast a steady barrage of jokes about
the shape of the penis of the President
of the United States of America? Who could've possibly
believed O.J. Simpson would be found "not guilty."
(I still can't…

How many companies considered "blue chip" 20
years ago are totally unknown today?

Some people have invested for the long term
and have profited from that endeavor. Perhaps a "buy and
hold" mentality was viable 20 years ago. But now, as they
say, "change is the
only constant." In fact, today it is not just change
that is constant, it…

Blitzkrieg "Paradigm" Change!

Anyway, if you are a "buy and hold"
"invest for the long term" type of investor, you and
I are definitely NOT on the same page.

Extremely
Short Term Investors: At the other end of the spectrum are
the "day traders." These guys stay glued to every
tick of the market... and... are often in and out…

6:45 a.m.

Alarm goes off. He gets out of bed.

6:45-7:20 a.m.

Showers and shaves. Used to have a little pager that
gave him market quotes 24-hours a day which he would put next
to the mirror so he could watch the prices while he was
shaving. His shrink convinced him this was…

7:20-7:30 a.m.

Cleans out his plumbing. His grandfather taught him
nobody is ready to start the day until they have cleaned out
their plumbing twice. "Try taking a crap in an outhouse in the dead of winter and you'll
always appreciate indoor plumbing. I do, twice a day."
(That's a little more than I…

7:30-7:40 a.m.

Breakfast. Bowl of Kellogg's Oat Bran, a glass of
Blood's fresh-squeezed orange juice, and two pieces of
Pepperidge Farm whole wheat toast. Says he eats to loosen up,
not to fill up. Reads the "Sports" section of the New York Times while breakfasting.

7:40-8:00 a.m.

At his desk collating all the faxes he's received while
sleeping. Gets 30 page account from Bear Stearns, his clearing
firm, listing the P&L of all his trades from the previous
day. Also, gets sheets from his different commodity brokers.
Makes sure everything is just right so he can begin each new…

8:00-8:10 a.m.

Quote: "This
is when I fly through the Wall Street Journal.

8:10-8:15 a.m.

Cleans out his plumbing again. According to Grampa,
he's now ready to start his day.

8:15-8:20 a.m.

Calls his bond brokers and gets support and resistance
levels for bonds for the day…

8:20-8:30 a.m.

Trades some bonds because it's a good way to loosen up.
Says most important news on bonds seems to come from
government at 8:30 on Friday mornings. Resents this because if
those announcements were made earlier in the week, he and his
fellow senior citizens would still be semi-fresh. (Maybe it…

8:30-8:45 a.m.

Might trade more bonds. Might not. Never trades when
there's this thing the futures exchanges calls a "fast
market" which is signaled by an "F" popping up
on the screen of one of his machines.

8:45-9:27 a.m.

Tons of faxes start to roll in. Matches this info with
opinions he's written the night before and taped to his quote
machine.

9:28 a.m.

Reviews his checklist which is laminated and taped to
the right hand corner of his desk. One item: "Is the MTO (Magic T Oscillator) in positive…

9:29 a.m.

On the phone to the S&P pit. Gets violent if this
sacred time is violated.

9:30 am-12:30
p.m

Stock market opens. Trades, keeps track of trades and
looks for patterns. "Pattern
recognition," he says, "is
my karma."

12:30-1:00 p.m.

Orders a number four to go from Seaside Superette.
Posts charts at his desk while eating his number four.

1:00-4:00
p.m.

More trading, keeping track of trading and looking for
patterns.

4:00-4:15 p.m.

Hey, now this is interesting! He says, "There's
a fifteen-minute flurry when the stock market's closed, but
the S&Ps are still trading. This is when you can really
get clobbered. The premium level will rise or fall based on
the orders for the close and the psychological setup for the…