Posts tagged ‘cash’

Stock Market Analysis Began with Rice in 18th Century Japan

The past few years have proven that the world economy lives and dies on the success of major financial markets around the world.

Traders use sophisticated software to analyze trends, make predictions and purchases. There is one legendary trader, who made billions of dollars analyzing market trends.

His name was Munehisa Homma and the only thing he traded was rice. His billions in earnings are in today’s dollars and he may have known more about market analysis in the 1700s than our smartest people do now.

He began trading rice in Osaka, where the rice market was very sophisticated, it even traded rice futures. Coupons were sold that promised the delivery of rice at a specific price in the future. Homma was believed to have created a personal network of 100 men located about 6km apart from each other to move market information between Osaka and Sakata.

He wrote the first book on market psychology in 1755, The fountain of Gold – The Three Monkey Record of Money. I have no idea what the title means, hopefully somebody is working on a movie adaptation and we can see it in 3D. Maybe it could be a prequel to 12 Monkeys?

Seriously though, Homma was a genius. He invented the candlestick chart, which is still used by traders today.

This handy chart combines four pieces of data into each plot point on a date axis. For example, you can look at a single day of trading of a specific stock and see the open and close price of the stock on that day (the candle body), along with a low and high range of prices at which it traded throughout the day (the candle wick). The candle body is solid when the open price is represented by the top line and the close price is the bottom line. It is hollow when it’s the opposite, indicating whether the price increased or decreased that day.

For a single date, this gives the reader a lot of information. But, it becomes a fountain of gold when you put multiple days together — that’s when patterns can be spotted. The great master could read the chart and predict how the market would behave in the future. Understanding these patterns is how he made his billions.

Charles Dow recognized the value of candlestick charts around 1900 and included them in his studies. You may have heard of him, he’s the guy who co-founded Dow Jones & Company, The Dow Jones Industrial Average and The Wall Street Journal.

He was obviously a brilliant man, but it was the research of Steve Nison in the early 1990s that popularized candlestick charts in North America. If you want to know more about these charts, you should look at his work.

Homma is still recognized as the greatest trader of all time. It is believed that he made more than $100 billion (today’s dollars). He once said, when all are bearish, there is cause for prices to rise.

Broken Secrets | By: Chad Upton

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Sources: Trader’s Log, Candlestick Forum, Wikipedia (Candlestick, Charles Dow, Homma Muneshisa)

Images:  Wikipedia (Candlestick Chart, Candlestick Definition)

June 23, 2010 at 5:00 am Leave a comment

Increase Your Income With Your Credit Card

There are two ways to get rich(er): spend less money and earn more money. Both can be tough, but here’s an easy way to start earning more money immediately.

Credit cards are a real life game and depending on how you play, you can win or lose real money.

When you lose, your credit card issuer wins big. When you win, your card issuer still wins, just not as much as when you lose. So, if you’re going to use a credit card, then you better be winning.

Some people have lost and decided not to play the game anymore, they cut up their credit cards and swear off credit forever. Depending on your lifestyle this may or may not work. In many cases, you need a credit card to rent cars, reserve hotel rooms, book flights and buy online.

Credit card issuers make it easy for you to lose the game. When you apply for their card, they ask you what your income is. Once they know they can trust you, they increase your credit limit beyond what they know you can afford to pay back each month. If you take the bait, they start lining their pockets with your hard earned money. If you carry a balance, you instantly lose the game — if you want to be a winner, be sure you pay your bill in full every month.

That’s the first step to winning. The second step is to switch your card to a high dividend credit (or debit) card. Dividend cards pay you a cash reward for using your card, usually 2-5% of how much you spend. This might not sound like a lot, but many people can make over $1000 per year with this. (more…)

May 24, 2010 at 5:00 am 14 comments

Keeping Secrets Safe at Home

You probably have things in your home that you want to keep safe: cash, checks, credit cards, jewelry, computer data, documents and other valuables.

In case of fire or theft, the best place to put them is in a fireproof safe. This might sound like overkill, but affordable models start around $30.

Safes are an obvious place to put valuables, so you want a bolt-down model — thieves don’t usually have time to open a safe during a robbery but they’ll want to take it with them and open it later.

If you’re looking for a less obvious hiding place, there are many options. You can buy “diversion safes” that look like everyday objects such as: canned food, bleach, candles, books, clocks and many other items.

If you’re going to use one of these safes then you should store it with other similar items; it doesn’t work well if there is a can of fruit in your sock drawer.

The fake bleach container and candle are both good since there are many places you might find those in your house. The bleach container could make a good hiding spot for the spare key in your garage.

The other thing about these “safes” is that they’re not always that safe. For example, they’re not fireproof and they’re very easy to get into, but they can be useful for storing a bit of spare cash when thin-mint go on sale.

If you don’t want to buy a diversion safe, you can make your own. Pringles cans work well.

Sometimes, it just comes down to location. Reader’s Digest interviewed a number of convicted burglars to find out their secrets to successful home robberies and among other things, the robbers revealed that they rarely ever go into kids rooms. Simply putting stuff in your kids rooms may be secure enough, although you may never find it again either.

The same interviews revealed that robbers don’t go near your house if they see a flickering TV or hear a radio because that’s a sure sign that somebody is home. You can buy a small device that emulates a flickering TV and it’s much cheaper to buy and operate on a timer than a real TV.

Although these hiding places would be great for an Easter egg hunt, they shouldn’t be used for really valuable items. The best place for that stuff is in a proper safe, safety deposit box or federally insured instrument such as a bank account.

Broken Secrets | Written By: Chad Upton

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Sources: Reader’s Digest, Reader’s Digest, FakeTV.com

April 28, 2010 at 12:31 am Leave a comment


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