Point and Figure Charts Paint A Better Picture Than The Media

by | Jan 17, 2009 | Asset Management, Point and Figure

Here is WHY so many think the stock market is bad.

And, why is the economy so bad?

As many of you know, I use charts to help me manage the risk in your investments.

Not just any chart…but point and figure charts.

Why?  Because, in my experience, these charts clearly indicate action points…when to buy, when to sell, when to hedge.

Also…when to be nervous.

But something these charts do not tell us — is WHY.
Why is this stock going down (when everyone tells me it should not be)?
Why is the market going down (when everyone tells me it should not be)?
Why is this sector in favor (when everyone tells me it should not be)?

The charts never tell us why.  They tell us when to act.

Shoot first, ask questions later.  If you wait for the “reason why,” you will be dead.

If you waited for the answer to “Why is Bear Stearns dropping?” or “Why are all these financial stocks falling?” to take action, you were destroyed.

The answer to “why” questions usually come with a personal response.  Think about it.
Why is ________ happening (fill in the blank)?

Because the government is out to get us all. (focus: get US)
Because we are in a recession. (focus: WE)
Because I have no money. (focus: I)
Because my job is on the line. (focus: my)

The answer to “why” questions are often returned with a personal spin…think of it as your own personal editorial.

So…who is telling us the stock market — and the economy — is bad?

The Media.

Newspaper and news sources are getting destroyed by the internet.  Their very livelihood/existence is being threatened.  The Chicago Tribune.  The Seattle Post Intelligencer.  Even the New York Times.  These publications are on the ropes.  Some other “newspapers” have stopped printing and are online only: the Kansas City Kansan and Hoy Nueva York, The Christian Science Monitor and The Capital Times (Wisconsin) are already “online only.”

The Pew Research Center announced last week that over the past year, the internet, as a news source has surpassed print (newspapers) as a news source for the first time.  Of course, The New York Times reports that the change “does not represent a decline in the popularity of newspapers,” but rather a “near-doubling” of the number of people that name the Internet as their primary news source.  Newspapers actually gained a percentage point in popularity over the last year.

Wake up.  That’s spin reporting (or, simpler, “denial”) at it’s finest.

Newspapers, and that entire business model are on their way to becoming dinosaurs, facing extinction.  Are you listening New York Times and the Wall Street Journal?  I single them out because they still believe their business model (charging premium prices for “news”) is truly not working.

So when the messenger’s job (the newspapers/media) is on the ropes…do you think they will inject their own personal spin on the news? Of course the sky is falling to them…their next paycheck may be their LAST.

And it’s not limited to print media.  Why do think news channels always have “breaking news” at the bottom of their screen?  Here’s some real breaking news: their advertising revenues are crashing, and their jobs are on the ropes.  Film at 11.

The messenger is experiencing a life-threatening recession, and some of them may not make it.  Especially the ones that cling to their old business models.

It doesn’t mean you have to live through their recession.

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