RunawayTrader

Adventure Travel Meets Online Stock Trading

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Banks and Credit Cards—I Hate ‘em

February 26th, 2010 · Stock Trading

Not too long ago I ranted about the chintzy interest rate I was receiving on some cash I stashed at my longtime financial larcenists, USBank. Now I’m being assailed (yes, assailed), by the folks you love to hate—the credit card companies.

Let me quickly regurgitate the savings bank gripe.

I opened a savings account at US Bank, just to tuck away a few rainy day bucks—just in case. My thinking was that, although I knew I’d get a better rate from the online banks (like Ing, Ally, etc.). But if I needed the cash in an emergency, I didn’t want to wait a couple of days before those bucks had miraculously gurgled through the ACH pipeline from their bank to mine and downloadable at my local ATM.

I knew the interest rate was lousy. I knew going in it would only amount to a half-percent but it didn’t look so bad—until I got my first statement. Then I was in for a shocker. I earned a lousy 69-cents. Crapola, that’s not even enough to buy a Big Mac, for crissakes.

I added another 5-grand and now, wowie-zowie, I accrued a grand total of $2.48 on $10,000 for, like, 4-5 months.

So here’s the complaint. These inglourious basterds are paying me a lousy half-a-percent on my money, then they’re loaning my cash to some other poor soul and charging them 15%, 20% or more interest for the privilege. Not a bad scam, huh?

Of course, it’s not just US Bank. Most all of the banks are paying next to nothing on savings accounts, CDs, money-markets, and the like.

And Now to Those IB’s at the Credit Card Companies.

First, a confession. I am what is known in the argot of the credit card empire as a “dead beat.” That is, I charge what I like, but ALWAYS pay my balance in full every month. I haven’t paid an interest charge in years.

But it’s obvious that credit card companies don’t like schlubs like me and couldn’t care less to keep my business. Why else would they keep jacking up my interest rate if I had a credit balance?

Check this out: I used to have a Providian (Washington Mutual) credit card. My interest rate was about 13%-14%/ Then along comes Chase Bank who buys the company. The first thing they did was raise my rate to 15.24% and this past month it zoomed to 27.24%. Doesn’t that make you feel all cozy and warm about Chase Bank?

Again, let me remind you, I pay this bill off in full every month. I have NEVER been late paying this or any other account. My FICO score is consistently in the 800s. And yet they practically double the interest rate. So guess who’s first in line to be cancelled when they try hitting me up for an annual fee or hobble me with some other charge?

But it gets worse.

I also have a Citibank credit card. At the close of business a year ago, my interest rate was 5.49%. Then, when the Credit Card Act was passed, Citicards quickly hit me with a $30 annual fee AND raised the interest rate to 14.99%.

I suppose I shouldn’t care. After all, I don’t pay any interest fee. But it is irritating as hell. You’d like to think that if you scrupulously maintain a decent credit profile you’d get matching low rates. But not anymore.

And I know that there are millions of others whose financial situations don’t allow them to pay off their balances each month and they’re getting gouged like hell by these turds. And we’re all getting ripped off to cover their financial mistakes  made in an arrogant rush to make more money.

It’s really quite shameful, is what it is. And some of these are the same A-holes we taxpayers bailed out not so many months ago. So much for reciprocity.They can all rot in hell, for all I care.

And you can tell them I said so.,

Charlie, the Runaway Trader

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Time to Load up on Precious Metals

February 5th, 2010 · Uncategorized

What with the horrendous meltdown of stocks today I took advantage of the freefall and bought more metal.
This time I voted for palladium since I am new to this metal.
Got in at like $435 an ounce. Maybe by the time it reaches my mailbox it will be worth that price.
More later.

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When Trading—Be Careful What You Wish For

January 21st, 2010 · Runaway Trading, Stock Trading

Ok. I relished Wednesday’s pullback in the market. It was just the opportunity I wanted to buy more shares of some stocks I wanted. But, and this is a big but, I certainly didn’t want or wish for the calamity that hit the market today.

And I feel there’s more heartache on the way tomorrow.

If you’ve been following the rants, and they’ve been wall-to-wall on CNBC tonight, you’d probably have to agree that Obama has gone way to far in the wrong direction and we (use shareholders) are doing to pay for his wrong-headed speech today.

I’m not even going to go into the huge outpouring of angst that is captivating the economic press today, but here’s a sample from the Wall Street Journal. It’s a good article, but there are scads more out there that carry the same theme. It’s like Larry Kudlow & Company writ not just large, but everywhere.


I’m thinking the market will be shattered again tomorrow, I guessing
another 125 points will be lopped off the Dow and who knows what’s going to happen next week? I’ve already been taken to the woodshed and given a sound whoopin’. I even sold off my FITB after the runfup today with thoughts of buying it cheaper tomorrow or next week. Yet, like a fool, I’m still hold Citigroup bigtime. Wake me up in the year 2015 when this turd recovers (if, in fact, it does).

Well, like I said yesterday, easy come, easy go. I’m still banking on AAPL next week. I think they’ll revive the market on Monday for a bit of a bounceback. Here’s hoping it brings my WYNN shares back, too.

Meantime, I’m laying low until the coast is clear and Obama has figured out who (and what) are the true villains of the economic meltdown, and taken the appropriate regulatory action. So far, I almost wish I had voted for McCain.

Charlie, the RT

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Don’t You Just Love Market Meltdowns?

January 20th, 2010 · Uncategorized

So long as you were not holding a bushel of stocks, today is a great day for traders since it opens the door to some easy money. When good, solid stocks crater because the overall market is falling, it’s as terrific times to start buying?

So what should you buy so you’re prepared for runup before the week’s over? Well, I’m picking on a couple of my old favorites.

Wynn Casino

Try to get into WYNN at less than 68 today (Wednesday) and ride this up to 71+ within the next few trading days. Maybe more.

Why Wynn? Because it will likely make a big bounce (4%+) since its beta is 2.9, meaning it behaves like a Wham-O superball bouncing higher (or lower) than the indexes, like the Dow. That is, 2.9 times higher than say the Dow might rise.

Moreover, it’s been behaving with a volatility that makes traders’ hearts beat faster than if they were cuddled up with their favorite hunk, male or female.

My prediction is: Buy at the close; sell when it reaches 71 and change.

Apple: The Everyman’s Digital Device Maker

My second choice is AAPL. Actually, I’ve already jumped into this trade at 210 and change and don’t expect it to close much lower than my point of entry. Why will this stock bounce back? Well, it hit 215 today and I expect, at minimum, it to return to that level when the indexes right themselves. Actually, I’m looking for AAPL to storm past it when earnings are announced Monday. But beware, my friends. Although I’m expecting a nice pop for earnings I’m getting out (or reducing my holdings) before they announce their iSlate or iTablet, or whatever they dub this new product they’ve been leaking information about for months.

That announce comes Wednesday, if I’m not mistaken. I’m guessing this new device will be little more than a glorified netbook at double or triple the cost and will draw polite applause at the Wednesday meeting. Share price, on the other hand, is likely to fall (buy on the rumor; sell on the news).

Anyway, let’s see if you can earn a few thousand bucks. Perhaps enough to runaway to Europe (Yikes! The Euro is less than $1.41) for a week or so.

In any event, buying today will position you for smaller losses, whatever the outcome. But my guess is you’ll be able to clean up and then take a few days off to bum around Europe. Is that OK?

Charlie the RT

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Did You Buy Platinum Like I Told You?

January 19th, 2010 · Stock Trading

In my most recent post, I wrote (well, bragged maybe) about how I caught the wave on platinum prices and watch my holdings swell $450 an ounce from my point of entry. So what. Did you buy any?

Probably not. Because that’s not the way most traders treat the stuff they read on various blogs and web sites. I should know. I treat most of the crap I read the same way. Most of what I read goes in one ear and out my butt. Why? Because I learned my lesson.

If I act on a tip I saw on Fast Money, I get burned. If I put any confidence whatsoever in Cramer, I’m toast. Same with that worst rag of them all, The Motley Fool.

This Virginia-based group was founded by brothers David and Tom Gardner,


and Erik Rydholm, who has since left. They employ around 200 people to help crank out an endless stream of blather that is usually paraded by the puppy dog eyes of newbie traders  under a headline with numbers in it: e.g. “The Five Stocks You Simply Must Own in 2010.” I ragged about the Fool in a post about a year or so ago. Nowdays, I purposefully avoid their missives since I know it’s virtually never about the stock that they used to suck me into clicking, and even if it is, it’s useless.

All of which brings me back to platinum. Now, I know you didn’t buy platinum like I told you. But if you had, you would have picked up $50 an ounce—since last Wednesday. That’s not bad. Obviously, the EFTs that track platinum, PALL, PPLT, etc., made similar gains, so you didn’t have to own the metal; you could have used the leverage of margin trading to pick up nearly 10% on your money. Since Wednesday.

Well, easy come, easy go I always say. I could have lost it all with the shares of Citigroup I’m holding. Fortunately, the gods ignored their earnings report announced today and the stock actually gained a penny or two and sent the indexes skyward.

Did you Short BIDU?

That silly runup on BIDU last week when Google implied it was leaving the China Internet market fooled nobody who’s been around. I shorted this turkey last week and was paid back today with more than 30 points.

Don’t bother writing. I know it was a good call. Who knows? Maybe you made it, too.

Charlie, the RT

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What’s Up with Platinum?

January 14th, 2010 · Runaway Trading, Stock Trading

Some months back, I mused about my growing positions in precious metals, particularly gold, silver, and platinum. My reasoning was simple: I wanted to put some of my portfolio in metals—just in case the stock market falls apart on a more devastating level than on 9/11.

The bottom line was I wanted my metals inventory to keep pace with the lousy rates banks are paying on CDs, money markets, and savings. It’s done that and much, much more.

Having said all that, I didn’t expect metals to surge to the degree they have. And platinum has been going gangbusters lately for reasons, I confess, I just don’t know. Maybe the Russians  (they’re the biggest producers of this stuff) are cutting back production. Maybe platinum is the new gee-whiz in the jewelry market. I don’t know.

In case you haven’t been following metals lately,  take a look at this chart I swiped from Kitco. Platinum is up nearly $450 an ounce since mid-July. That’s almost 40 percent. In fact, it’s up $36 today alone!

No, I wasn’t smart enough to buy platinum when it was $1,150, but I did buy some 1 oz. bars at $1,198 and more around $1,300. You do the math. It’s a nice runup in six months, and a better rate of return that US Bank, which I recently bitched about when they paid me a lousy 79-cents interest on something like $10,000. You might just as well put your cash under the mattress at rates like that.

Other Metals Doing Well

My other metals purchases are still doing well, too. I bought gold (Krugerrands) at an average of $773. With spot gold at $1,138 the Krugerrands are now worth $1,152. And the silver ingots I purchased last March at $14.63 an ounce are now up to $18.63.

Still, platinum is doing best of all, and I expect it to inch higher. Why? Well, other than jewelry, the primary use of platinum is in auto catalytic converters and when auto production ramps up, I expect platinum demand will rise with it. Expecially when you think about the huge auto demand growing in China.

Perhaps not like the rocket-trip it took back in 2008, but higher, nonetheless. Bloomberg seems to agree. Here’s what they wrote in an article yesterday, an opus which probably had something to do with the huge runup today.

So where to from here? Well, just because I like pretty things, I placed an order with Apmex for the 2010 Silver American Eagles. Not to be confused with that crap that they so often sell on TV and on some Internet sites, these are brilliant uncirculated coins which will be released by the mint (yeah, the real one) sometime this month or next.They look a lot like the old walking liberty half-dollars. Beautiful coin.

I locked in my price at $19 and change a month ago. Apmex is now selling these beauties at about $22. And if you hate the prospect of shopping around, you can also order them from an outfit that calls itself GovMint.com, but you’ll pay $36.95 or $26.95—depending on which is the typo to believe when I last visited the site.  (Maybe you should think about buying them from Apmex and selling them to GovMint!!).

Meantime, I’d like to buy more gold but I think I’ll wait until it drops back below $1000 an ounce. Maybe that’ll happen when I’m on the road. My getaway date draws near.
Charlie, the Runaway Trader

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Need Sex? There’s an App for That!

January 8th, 2010 · Runaway Trading, Stock Trading

Well, not exactly. But trust me. There will be such a carnal cyber-app sometime in the near future.

Don’t believe me? Well, you must have missed Thursday night’s CNBC showing of Planet of the Apps because if you had viewed it, you will come to believe, as I have, that there will eventually be an app for everything, including sexual liaisons.  And if you did miss it, here’s a link to some highlights and don’t worry—CNBC will rebroadcast this thing dozens of times in the coming weeks.

I admit I was slow to arrive on the apps bandwagon and boarded the iPhone rather obliquely because I wanted a more mobile platform from which to trade stocks. If you read last missive on this subject, you’ll know I settled on iStockManager, a terrific app that leads me to believe that in the future, I might not use a laptop, let alone a desktop, to make my trades.

Still, I’ve be adding trading (and other) apps as I go along. Soon I’ll need a filing system just to keep track of them all. I’ve got trading apps, news apps, travel apps, music apps, social networking apps, etc., etc., etc.

The Future of Apps

Where will it stop? Well, obviously, in the next year or so there will be a seismic shakeout in the app landscape and thousands, probably hundreds of thousands of apps will disappear into techno liquefaction. Call it an app “bubble” if you like, but lots of folks (especially app developers) are likely to lose gobs of money as app store shelves buckle under the weight of new, and often redundant, applications.


Even CNBC’s show offered the cautionary tale of one group of developers who spent a half million dollars on their app and related marketing—only to have the Apple “approval” process freeze their app in no-man’s-land with neither approval or disapproval.

In the meantime, you can expect all web URL’s will begin to remake their sites to make them smartphone accessible and friendly. They realize (or should) that the Internet is really going mobile, and the old site designs just don’t cut it. I mean, if my little blog is iPhone accessible (and it is) how long can it be before the world’s websites will be redesigned to follow suit? That’s a bonanza of work for web designers. Still, look for an app sometime soon to help you redesign your site for the smartphone.

Expect corporate sponsors to get more deeply involved in app development. Here I’m not only talking about car makers who’ll add screens and apps to auto dashboards, but companies that manufacture a broad spectrum of products from coffee makers to cash registers to Coke machines to feature apps that enable communications with smartphones.

Actually that app is already here. Bump uses location-based technology and WiFi to exchange contact information between two iPhones or compatibles. Theoretically you can “bump” a cash register terminal and pay for your groceries, your Big Mac and fries, or the front door of your house to unlock it.

My son, Marty, the digital innovation guy for Minneapolis-based Fallon Advertising, is now at the CES convention in Las Vegas drinking in all that’s new, smartphone app and otherwise. I can hardly wait to discover, firsthand, what he’s learned and his predictions of the mobile future. Incidentally, If CES stuff interests you, follow his play-by-play Tweets from the convention floor at this link.

In any event, get ready. There’s a jillion more apps coming to a app store near you—whether you like it or not.

Oh, and one last confession. I wrote this entire piece on my desktop—-but I could have written it on my iPhone because there’s an app for that. And here it is.

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Technology . . . Ain’t it Wonderful?

December 23rd, 2009 · Runaway Trading, Uncategorized

One of the pitfalls of reaching, and passing middle-age is the propensity of oldsters to reminisce about “how things used to be,” and their graying recollections are usually colored by tales of trudging through 6-feet of snow to reach a one-room schoolhouse or how they used to ride streetcar trolleys and listen to Gangbusters or Fred Allen on Admiral radios as big as dishwashers.

But not all oldsters are given to such unrequited nostalgia. And while I have no data to back it up, I think today’s pace of change, particularly technological change, almost forces everybody, not only seniors, to stay current.

Case in point. I’ve remarked in a couple of recent blogs that I’ve really grown close to my smartphone, and in addition to be a must-have appliance for runaway traders, it enables me to diddle away my leisure time checking out most any thought that flits into my empty head—whether from a living room easy chair, a restaurant (who was that actor who did the sendup of Linda Tripp on Saturday Night Live and is it available on YouTube?), or in bed.

Last night, for example, I was watching Letterman beneath a cozy comforter when it dawned on me (yes, dawned) that soon, smartphones will enable you to do most anything: start your car when it’s -20 degrees outside and you’re still 3 blocks from the ramp where you parked; buy a bowl of soup from a passing dabbawalla in remote India, or record a TV program back home in Minneapolis while I’m digging for gold with those garimpeiros at right in Brazil’s Serra Pelada.

Not yet–but soon. What specifically dawned on me before I dozed off (talk about flitting ideas) was whether or not WordPress, the software that powers this blog and a jillion others, has caught up with the iPhone. Or vice versa.

Dumb question. Of course it has. And I noted this revelation on my calendar for Tuesday’s “to-do” list. First thing this morning I downloaded a WordPress smartphone plug-in and voilá, the RunawayTrader is now available in an iPhone-friendly format. Check it out. The iPhone version can even display those intrusive Google ads, but it does not contain my other sidebar stuff. Still, it’s a welcome addition for those regulars who simply must follow this home or away (probably in some asylum somewhere).

Ain’t technology wonderful? I hope I’m around to for a hundred years just to see where we’re really headed, or Dec. 21, 2012—whichever comes first.

Charlie, the Runaway Trader

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Mirror, Mirror . . . Who is the Best Online Broker of All?

December 21st, 2009 · Runaway Trading, Uncategorized

A reader of my blog recently asked me which broker I thought was the best. That’s a tough question. Actually, it’s impossible to answer since we are all an experiment of one. And while I’d ordinarily answer this fellow in a private email, I thought I’d respond in a blog, and then the rest of you guys can crap all over my suggestions and offer a few of your own.

First of all, a few confessions are in order. The landscape of online brokers changes frequently, as some firms are victims of mergers, others drop off the radar, and smart new ones join the fray. I say that because my comments are based on brokers I’ve used over the past 15 years and I’ve developed a very narrow trading strategy which does not take full advantage of what many brokers offer. Things change. And my readers are more up-to-date on what other brokers are doing than I am.

Second, and most important, the best broker for you always depends on the kind of trader or investor you are.

For example, I don’t trade Forex and it’s not offered by my broker. But it is offered at Interactive Brokers. See what I mean? If I were really interested in this kind of trading, I’d know where to go.

I also don’t trade a lot of options. Yeah, I trade a few but my broker is fully operational in that area and offers all those straddles and leaps and stuff. But if they didn’t and I was hot on those trades, I’d know to go to Optionetics, or one of the other brokers that specializes in those trades.

From the Beginning

I began trading using Schwab. Actually, that’s not true. I began online trading with a Minneapolils broker whose name I forget. That’s when we made trades by picking up the telephone and calling a broker who’d place my trades. Anyway, when I jumped into cyberspace, I hooked up with Schwab, but quickly abandoned Chuck because his commissions were too high to suit my taste. Still, that was years ago and now Chuck has Cybertrader.com and they’re much more competitive.

Then I moved to Datek. They had a terrible, simply awful reputation back then. Trades often vanished into cyberspace. Others were executed only after lengthy delays—I’m talking a half-hour or more, here. It got so you’d never want to place a trade, especially a market order, with these turds because you’d never know when, and at what price, it would be executed.

But Datek was swallowed by Ameritrade and their service and execution grew remarkably better. Trades are about as instantaneous as one can get. And they’ve got all the bells and whistles that I can use: plenty of research, plenty of ratings of stocks and analyses, plus a full range of banking services, and bonds, and mutual funds, etc. etc. And you can move your money around through ACH as often as you like. Plus, they’ve recently added the ThinkorSwim trading platform, but I’ve yet to figure out how to use it.

And one last thing: Ameritrade has a swell iPhone trading platform in iStockManger which, while it isn’t perfect, is pretty damn good. I recently wrote a blog about that. You can almost leave your laptop at home and trade using your 3G. Of course, eTrade offers the same thing, and I’m sure the other big online brokers have, too. But the important thing is, for a runaway trader, the iPhone is a must—and I’d now be lost without mine.

But, I’ve used other brokers as well. I tried e-Trade, but was disappointed. They had lots of bells and whistles, including a bank with check-writing and debit card services, but their trading platform then was clumsy and hard to use. I tried Scottrade, and I was even more disappointed. At that time (probably 4 years ago or more) their rates were low but I couldn’t trade in the pre-market. What the hell were they thinking? Can you imagine holding a stock that’s cratering in the pre-market and be unable to sell it? And that sort of thing happens every day. But, I suspect Scottrade has changed this archaic position. Actually, they probably charge a higher price for extended trading.

So, I now have two accounts with Ameritrade (one for day trading; the other for investing) and I get what I want. And I should point out that I don’t care a gnat’s ass about such things as interest rates (on idle cash), brokerage fees, etc. Yeah, yeah, I know that brokers tout low rates. But all I care about it fast, dependable execution. If the broker screws that up, you could lose thousands of dollars on a single trade so who cares whether the dependable ones charge you a buck, more or less, than the other guys. I should also point out that some trading platforms make such goof-ups easy. I mean, who among us hasn’t entered a buy order when what you really wanted was to short sell?

So what’s my advice?

First, take a look at the type of trading or investor you are. Research their services. Egad, they are dozens of brokerage ratings services online from among the 80-million Google hits for “online brokers”) and choose your poison. If you don’t like what they offer, move on. After all, I’ve used at least a half-dozen and would move on in a New York minute if I thought I could find something better than Ameritrade.

If you know what you’re doing when you trade, you’ll make money. But if you don’t, the best broker in the world isn’t going to help you.

OK. Now you other guys can weigh in. Who IS the best online broker, anyway?

Where Art Thou Going, RunawayTrader?

One last note. Max, the chap who inquired about brokers, also asked about where I am running off to next. Good question. And I admit I’ve been delaying because I’m busy finishing a book editing project which goes to press next month. So the answer is, I’ll leaving on a jet plane the minute its finished.

First stop, Sydney, Australia with side trips to the Great Barrier Reef and New Zealand. Then up to Indonesia, Thailand, and Vietnam. Then I swing eastward to India in time to skip across the border to Kathmandu and that Mt. Everest basecamp trek. Should be gone several months—if I can earn the money trading to make the trip. Otherwise, you’ll find me washing dishes at some deli in Namche Bazaar.

More on that later.

—Charlie, the Runaway Trader

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Gold: Buy High, Sell Low?

November 5th, 2009 · Runaway Trading, Stock Trading

In a former life, I was (among many other things), a marketing communications director for a major Midwest mortgage banker. This was well before the sub-prime mortgage meltdown, and the company I worked for never, so far as I know, got involved in these dicey instruments.

I bring this up today because of a lesson taught to me by the CEO of this corporation. His marketing philosophy was simple: when interest rates are high, mortgages can be a tough sell, in which case you should keep your advertising dollars in reserve. But when mortgage rates are low: damn the torpedoes, full speed ahead. Spend. Spend. Spend.

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