Same here mate.

I understand, and I think at this point, we're just on a side tangent. I think you address the root of your position well at the end of the post.

The inability that many have ... to be content. I'm not talking about complacent. Nor am I saying that it is wrong to garner 'more' for oneself. I'm talking about being content with what we have. When new wealth comes into being - content with the portion that our work has provided for us. Therein lay the key. Because new wealth is created.

In order to live and breathe? We move our economies forward by working. Therefore, wealth, as I see it - is a natural by-product of simply working. Of an economies existence. For an economy to exist, wealth is created. But more on this later.

When the wealth is created, and we gain more than we once had? Many people have an inherent need for more. I call it worshipping the God of "More". And not simply more. Because wealth is created. It has to happen. It's a by-product of an economy. But the problem is the lack of contentment with wealth, and the need to have more than others. That, is the fundamental problem.

I think the economic segregation that occurs is a natural by-product of people who need to have something, for no other reason than their neighbor has it, and they lack contentment.

True enough. However, you look at men like Rick Wogner of GM, and then someone like Jim Senigal of COSTCO. Complete and utter polar opposites. Jim is an absoluting fascinating CEO, and I do believe that the U.S. needs more CEO's like him.

I used to work at the GM World Headquarters (Before I got sick of my taskmasters, ). The extravagence. The waste that I witnessed was stunning. The bonuses of the CEO's and executives. Whereas you take someone like "Jim" of COSTCO? Who is a very wealthy man, and doesn't understand why he needs to be more than a very wealthy man. As you yourself said: At a certain point? It becomes redundant. He still makes a lot of money each year. But he doesn't make 600 times more than the lowest paid worker, as do many CEO's. It think it averages out that Jim makes about 12 times more than the lowest paid worker. The dichotomy between CEO's and the lowest paid employees? That's what I see as the problem.

So to answer your question - I would compare the other men I know who are wealthy? To Jim Senigal of COSTCO, than your Rick Wogner's of GM.

. Well, then it depends if you have a Rick Wogoner for a boss? Or a Jim Senigal?

I would state: How it has evolved. Not how it needs to be. It's interesting to note that COSTCO has some of the highest paid, entry-level employees out there.

I agree ... sort of.

Ahh, here we arrive at the root of the matter. I would agree that would be true, if any economy was a zero sum process. But economies are not zero sum. Resources are used, and the opposite of zero sum occurs. Wealth is created where wealth did not exist before.

True, but only when I'm trading. When I'm investing (I'm also a Dividend / DRIP Investor) - then it's not zero sum. My wealth is then created through stock splits, dividends, and DRIP programs based on market multiples. No one lost. I'm sharing in the profits of a company that has literally created wealth where wealth did not exist before.

No, I think actually, quite the opposite, and therein lay the problem. Wealth gets created, and unfairly distributed. I'm no socialist by god, - but I do adhere to the old Semetic proverb: "The Workman is worthy of his wages". When CEO's are making 600 times the lowest paid employee with the new wealth that's out there? And the wages of your average American remain flat? There's a problem.

Wealth and economies are not zero sum. Wealth comes into existence where it did not exist before. I think we'll agree that this concept is as old, as well ... any economy out there. We once lived in castles or on farmlands. Now we have societies that are much wealthier. We have A/C, heat, video games, vehicles and so on. That process continues on, and will continue on as long as mankind is working. The problem, is what my father called the 'uber' rich, are using the cloak of "Free Market Capitalism" to disguise the fact that they are nothing more than rich Socialists, who are still paid exhorbant amounts when they do not produce. They are being paid, much more than they are worth, and garnering an unfair percentage of the wealth - even when they fail to produce well for the economy. This dichotomy is how the evil of Communism and Socialism continues to prosper. Because instead of addressing the root problem? That those at the top economic strata are continuing to be rewarded for failing to produce? And rewarded an exhorbenant amount of money for failing? Then the gullible hear about something like Communism, and because of a natural injustice? The lunacy of Marxist thought makes sense to them (I call Marx a "parasite of injustice")

True enough. Although I would state that learning about the value of material contentment has assisted me financially.

Nope, but I think in the case that I mentioned earlier? What he distributed more than paid for the seminar. As he was trading - did it come from the loses someone else had? Yeup. But he was also performing a vital economic need for the rest of society - in that a) he was providing liquidity for commerical interests of the commodities he was trading with fair price arbitration, and b) providing liquidity for the investors (such as myself at times) of the stocks he was trading.

No problem. I enjoy the interchange.

__________________
Investing and Trading Blog, with education for the low funded trader ...
Investing and Trading Video Blog (Vlog) at YouTube

Let me start by welcoming Airelon to the discussion whose thoughts I am always pleased to hear and secondly by saying that while I have thought long and hard about this subject, my thoughts are still developing so I am enjoying this opportunity to assist in that process.

It is interesting that you mention Microsoft here as I think the company is a great example of how the greatest profits can come from those who help others profit..

I say this because early on I think most people will agree that it was Microsoft's openness with its platform that allowed it to trump Apple, who I think many will also agree actually had the superior platform at the time. Where Apple closed off its system to outside developers and still to this day does everything in house, Microsoft opened up many aspects of its platform to outside developers and offered to license its system to whomever wanted to use it (most famously IBM).

So most if not all of Microsofts success up to this point with its Window's operating system is in my opinion due to the fact that they created the largest tide to lift all boats which was essentially:

1. They allowed computer companies such as IBM, Compaq, Dell, etc to flourish using their operating system when they could have kept it proprietary like Apple did.

2. They opened their platform up to outside development so that pretty much anyone who wanted to could develop applications to run on the Window's operating system, unlike Apple who kept everything proprietary.

As a result there are more computers running Windows (and more computer companies and everything that comes with that making profits) and more applications which users of Windows have access to (and more development companies who are making money as a result) which also benifits the end user with a platform that runs the most devices and has the most programs to do the most things.

No, as I believe the above example shows, this does not go against everything I know about how to grow a profitable business. As another example take Amazon, which pretty much dominates ecommerce. While I think it is pretty obvious that they still could be a leading player in the online space had they not done this, would they hold such a dominating postion had they simply sold their own products and not offered the ability for people to purchase from 1000's of other online stores that also sell products online and are therefore direct competition to Amazon?

So in short, the reason to split out profits with 10 people instead of buying them out or suffocating them is because often times (not every time but often times) the pie is so much biggger when 10 people in the same place partner together and then take a small piece of a big pie rather than a big slice of a small pie.

Back to you.

Best Regards,
Dave

__________________
Disclaimer: Trading is risky and can result in substantial financial loss. As always my posts are simply one traders opinion and should not be taken as trading advice. I am not a financial adviser so everyone please do their own analysis and take responsibility for their own trades.

In my view as a new trader, I think it is very helpful to learn from people who have been there and done it right. I know trading is a competition of sorts and I know it involves alot of money, but sharing your edge won't ruin your success. In my view, just because you tell others what you do, won't make everyone a great trader because great traders have a special gift that has been crafted over time. You can tell me the best strategy in the world, but I guarantee you that I won't execute it with the same precision as you. Why? Because I am relatively new to this and have not mastered even some of what you may consider basic. I like to think of trading like sports because that is another passion of mine. We watch the guys in Division 1A or the NFL or whatever and see all the spectacular things that they can do, but we couldn't go out there and do what they do without a ton of practice and the same gifts.

Very good point, but you also have to consider that those men have learned from watching pro's all their lives. I wonder if Jordan or Favre would have even ever become athletes had they never seen how a pro basketball player handles the ball, or how quarterback legends find the hole all the time. Becuase of their greatness they have inspired many to play their game, and over time helped bring about their own competition. This is not a problem in sports becuase by the time the next group of talent comes in it is time for the greats to retire. Traders don't retire @ 45. So if we all make our systems known we are planting seeds for people to exploit our system. It may not happen right away, but eventually, if your system works, people are going to see that it works and begin to increasingly utilize it. Yes it's true, no one will instantly become a great trader upon recieving information about how to be a good trader. It takes time and energy to achieve this goal. The truth is, I became profitable only after I started studying under a professional who knew what it took to become a great trader. One of the things he frequently talks about is not telling everyone exactly how you achieve success in the markets. This could be becuase of his CME trading floor experience. In that setting you would be more likely to feel it when someone mimicks your system, but why wouldn't that same principle translate into the wider market?

In ancient times when a new king was enthroned he would have his soldiers murder the families of the previous kings royal court. Why? What could the little sons and daughters do to him? It wasn't today he was worried about, it was 20 years from now when they were grown up and could remember how their father was "unjustly" overthrown.

I would percieve revealing my system as a threat for another reason as well. I have heard the argument several times that just because you tell someone how to trade properly doesn't mean they will be able to implement it properly. While this is true, I think this is worth considering; Trading profitably is an EXTREMELY simple endeavor. Anyone who is profitable knows this. When I first experienced the system I use now I was amazed at its simplicity. I will tell you this, and some might laugh, I don't use a single indicator other than volume and price. No macd, no fibonocci, no stochastics, nothing. Heres another gasper, I don't use a single conventional chart pattern. yes that's right, no triangles, no hanging mans, no bullish engulfing patterns, and no ( this one is my favorite to laugh at) cup and handles. As the saying goes, even a broken clock is right twice a day. If you look for these patterns long enough you are bound to find a few that work out as expected. The method I use is so simple that a child could do it if I showed him what to look for. So maybe this will help you guys understand why I don't wish to reveal all of my methodology. I often think of my methodology as a 4 digit bike lock. A 5 year old can remember 4 digits and open the lock, but If I tossed the lock over to Einstein and told him to open it he would be lost without the combination.

Just another thought..... Not to bash this site, because actually this is one of my favorite sites and I think Dave does an amazing job technically as well as intellectually maintianing it, I often like to come to this site and take a gander @ people asking all of the wrong questions. It reminds me that dumb money is pouring into our markets at breakneck speeds. I hear people asking about techincal indicators and oscillators, fundamentals and economic announcements, and I just think to myself..." Keep the BS coming." There are not many better things for my trading account than an army of greedy, illequipped wanna be traders........Save when they gang up on me and run price to where it is way out of balance.

Hi there shootanappleoffmyhead i have stopped entering the thread for a while but now i saw your last post and i guess it worths replying to
looks like you like to show off your trading skills and laugh at new traders which is unethical to do so..... as if you can remember i didn't think you were born with your trading knoweldge that you say you have now and as i think you were -sorry to say that i mean no offense- as dumb as new traders are now and as i think too you learned from a proffessional trader who gave away his knowledge and imagine your self without these proffessional traders you learned trading from how would you be now ....
just wanted to say that as you had the chance to be at where you are now another traders will have this chance somethings are secrets i know and everyone has a secret but we aren't gonna give secrets we are gonna help
developing good traders...i mean just imagine that all the proffessional traders stopped teaching other traders and there were a note on every market that says : ONLY FOR PROFFESSIONAL TRADERS NEW TRADES KEEP OUT.. what would happen to these market if all the proffessional traders die.... markets will shut down ,go broke there would be no foreign exchange market no stock market no nothing ....
this is my opinion after all...
just want you to remember how you were before....we have a saying here that says : (no matter how high the bird rise someday it will fall the way it rised) so keep out and try to learn from others experiences so you don't fall too
best luck
Houssam...

Hello Houssam,
Thanks for the reply. Yes, I do agree that showing off trading skills while laughing at those who do not have them is unethical. However I do not think that is what I was doing. What I was trying to point out though is that there is a 9:1 sucker ratio in the markets which is good news, thats all.

Shootanappleoffmyhead, I feel that your response sounded a little cocky. You were not a great trader your whole life as the other guy said. Have you ever heard of pay it forward? That is how I try to live my life. I have skills that I can share with the world and i intend on sharing them. Who cares if you share your "secret sauce" and if it helps others to realize their dreams as well. I seriously doubt that you sharing your knowledge will sabotage your account. Money seems to totally corrupt people and their minds. Think about all of the teachers out there in all walks of life saying, Nope I'm not gonna teach anyone what I know. I'm gonna hoard it all to myself.

Hi Tigerman,
If my response sounded cocky to you thats ok with me. I don't see where you're going with that. Unless indeed you are the thought police. If so by all means cuff me. It is completely up to me whether or not I share my strategy or not. I encourage you to read most of the previous threads to get an idea of my stance as well as the stance of others on this matter.

Sharing trading ideas is a matter somewhat different than other knowledge. In business, it is widely accepted that one should not give away trade secrets. This is the whole idea behind patents and copyrights. What we are trying to do in this thread is compare and contrast how trading sizes up against this thinking. If you have any thoughts on this we would like to hear them, but please, let's not turn this into a pissing contest. Emotions never translate well over Halvetica.

Hey Dave,
I am falling more and more in love with the idea of lifting all boats. I feel I understand where you are coming from regarding a business plan approach as well as a philosophy of business.

As usual, I do have some questions and thoughts about the differences between where this method would prove useful as opposed to where it would fall into the charity category.

Microsoft's approach was borne out of lunacy, and grew up to become a genius, made possible by sheer opportunity, and documented in the annuls of greatness. Though this approach did do well for others on a very wide scale, wouldn't you say that the priorities of the company remained profit bound? Self interested? It just so happened others would profit as well. Basically MSFT succeeded in placing themselves in the slot of biggest middle man in the history of middlemen by offering themselves as a subcontractor for computer companies with a near monopoly on OS's. Looking back it is amazing that AAPL did survive, and it occurred to me that the only way this could have happened is if their OS was superior in quality.

MSFT and AMZN are both great examples of empires for the people, and the unique demographic of not just people, but people on computers, made this possible for both companies. This gives rise to my inquiry.

Does trading fit well into the corporatacratic structure?
Isn't it a whole different animal?
Does a market setting foster the dynamics of tides that lift all boats?

Thanks for listening.

I find these statements very interesting along with the more philosophical parts of this thread. It is impressive that a professional trader was able to teach shootanapple how to trade successfully without telling him exactly how to do it. I thought this website was trying to do that, without hype.

If we novice traders are able to gain from the knowledge on this site then it becomes one of our tools along with our chosen software. If Dave Waring gains in some way from imparting his knowledge then one of his tools is his computer software and operating system, the manufacturers of which will profit in turn. There is no limit to wealth, number of successful traders etc.

I don't think anyone has ever helped anyone else with anything other than fundamentally selfish desires, even if it is just in order to feel good.

Regarding trading as a beginner, I understand that if I truly follow sound money management this will be the key to possible success. Thanks Dave and Airelon for hammering that one in. I was a bit thick getting it to start with but I am just beginning to understand the importance of not only a system that works a certain amount of the time (still "honing" that!) but the potential profit versus loss on the trades.

If I never risk more than 2% on a trade and I blow my account out, then I am doing something very wrong. I don't mind admitting it took a few days for me to even be able to quickly work out what my risk reward ratios were on trades. Next I have to learn to discipline against trades that look good according to my system but don't offer the correct risk reward ratio.

If the day comes that I am making money and have a working system and overall strategy maybe, kowing me, I will be so pleased with myself that I would like to show off a bit. I might also want to help other people achieve what I achieved free of charge, like I do at work if I find a better way of doing something - it certainly doesn't hurt my reputation or working relations. And if I got carried away I might reveal my incredible secret formula. And anyone who wanted to improve their trading skills would do well to listen to all of it, no matter what I stood to gain.

By the way I completely agree that ardent players of the lottery aren't showing much intelligence. The possibility of a big win can be overwhelming however, even to someone who understands their likelihood of winning. It's the same with trading, I suppose.