The question behind the question for all online trading and options trading individuals is the status of the credit markets. Will banks start to lend in a meaningful way, or will they still remain afraid of each other.

This new plan sounds a little better than the other, and it might get some credit activity going. It won’t happen overnight, however.

It’s pay attention time for anybody in online stock trading, including the stock broker. But those who are active in trading online can at least work with the market. In today’s world, the old “buy and hold” idea is one few can afford anymore. Things look a little more hopeful with the latest government actions.

With the various governments buying stock in banks, it may make some institutions more rea-dily take a chance.

If that’s the case, and the banks do start to lend to each other, then some businesses might be able to go in and re-establish their lines of credit or unfreeze the one they have.

This is an uncertain time. Waiting is the hardest part.
And waiting is all we do.

We are waiting for the credit markets to loosen.

We are waiting for an election to be determined.

We are waiting to see the damage done to business during this latest alarm and slowdown.

Finally, we are waiting to see if the consumer has anything left.

The last is the lynchpin. Without a committed consumer, or a consumer who is too shell shocked to part with too much cash at once, we will not see a meaningful recovery.

This circumstances are unlike any other panic and then economic slowdown in history. At least in the United States. The consumer is buried in debt, inflation at the household level is high, and taxes on a municipal and local level have increased.

The only bright spot, if it can be called that, is gas decreasing.

And that will only be temporary if demand increases. Then OPEC will restrict output and a nasty cycle starts again.

There is a chance that Joanne Consumer can take any spare cash on hand and pay down debts. This last week has put the fear of Herbert Hoover in many out here.

Now it’s kind of a race. If your small investor sees stocks kind of steady, then they won’t be tempted to sell. If they see a incessant slide in the markets, then all bets are off.

Lots of earnings reports are due out soon. That will have a big effect.

Online trading couldn’t be more critical right now for inves-tors of any size. I’m using all the information accessible at my fin-gertips to decide the future of my portfolio, just like an online broker or online options broker.

My first thing to do is to choose the sector. I think might ride out all the market problems and have some degree of value left when it is all said and done.

I’m taking a really close look at utility stocks. I’m looking at them globally, but my focus will be in the United States primarily. That’s where the biggest allocation of money for that sector is going to go.

I’m a little worried about utility companies that have the most exposure –i.e., the biggest market– in the northeast and mid-west of the United States. While a bitter winter might drive some of the earning up for utilities there, the chill of the economic downturn could change any positive results to the downside.

My first way to examine the companies I was investigating was to look at the Price Earnings Ratio (P/E ratio).

Then, if that was acceptable, I tried using a different metric. I looked a Cash Flow Analysis.

There are a couple of ways to do this. This should be on the first page now of any online stock trading web site.

First, cash is very important. That may sound like an obvious state-ment, as cash even within your household, is very important. But this is — or was– a world that revolves around the free flow of credit. Now, with the credit markets being stretched, it is [/spin]very|extremely[/spin] important to know the cash position of any utility that I may be considering.

One way to do a Cash Flow Analysis is to determine the Price to Cash Flow.

Basically, a company’s cash flow is the net income with depreciation and amortization charges added back in. Why add these expenses back in? Because they don’t truly represent true cash pay outs.

Therefore, the actual cash position is higher than what the net on hand would suggest. Divide the price of the stock by cash flow per share, add the expenses back in, and then you have a good idea of strength of the company.

Another way of calculating Cash Flow Analysis is to examine Free Cash Flow. This method takes the process further in that one-time expenses are added back in. These can include capital expenses, dividend payments, and other non recurring charges.

This is the basis for my assessment of utility stocks. The [spin]good|nice[/spin thing is that many web sites will have a calculator for this, or state this. So all you have to do is pay attention.

Today’s attitude is a bit more fickle.

Online stock trading and online options trading have never been more challenging and more re-warding. Without today’s modern conveniences I’d be in the dark until I came home from work. Or maybe even later.

Instead of reading what happened in the paper the next day, just like the professional stock brokers, I can at least get nearly real time accounting of what’s going on.

Online stock trading is probably helping a lot of people sleep at night. Nothing is worse than not knowing.

As I expected, financial stocks are showing solid to the upside, but consumer driven stocks, like Microsoft are weak. This probably portends that everybody is looking ahead at a soft economy — a recession.

It would be surprising. Trillions of dollars have gone somewhere, and trillions are being spent by the public sector to make banks whole. The trillions lost and the trillions spent have to come from… us.

So, obviously, there will be a slow down in the economy.

Coke is down, too. And I just heard that Pepsi will be laying off people.

I took another look at the tech stocks. Amazon is down in a big way, 5.8%, and it joins Intel and Google and Oracle. Google is looking like a steal at $376 a share. I might load up.

The tech stocks that were up a bit at last check were Apple, IBM, Sun Microsystems, Ebay and Advanced Micro Devices.

It’s obvious on some of these tech stocks as to why they might be up. Ebay, especially. The question is, will their small rally last?

Next, I will take a look at Johnson & Johnson and see how they are fairing. Also 3M.

I’m just wondering if we are beginning to see doubt creep back into the markets. Not so much doubt now about the banks and financial companies, but doubts about what the consumer might do.

Most consumers are strapped. They have no options, being leveraged up to the hilt with credit card debt, home equity loans, car and student loans. There is no end to the consumer issues, and this probably won’t be a consumer led recovery in the recent sense of it.

The past couple of recessions have had the consumer step up, but now, with debt being so high and with so many feeling poorer with losses from their 401(k)’s and diminished housing, it is a real question of what the struggling consumer can do. If anything.

Now the markets might pause to look at that, if they think the banking crisis has been controlled.

Tons of people I know are dropping money in the stock market these days and have no idea why they are losing. Well in the very short term it's been hard to make money with the markets the way they have been, but I hope people don't let that get them down. The stock market is the thing that drives our world. I've been investing since I was 18 years young (over 35 years ago) and these days it's simpler then ever to earn a profit in the markets.

Do I know some big secret? No, of course not. If there was a solution where you never lot money then I wouldn't be telling you ha ha. Can I tell you how to earn money more easily and consistently? Well there defiantly is a way. That's what I'm going to write about now. Something that can help every investor our, regardless of their skill level is stock investing software. I remember the old days when I had to sit down for hours on end (as did other agents at my firm) and do calculations every day. I disliked it. Going through the stock market entirely was imposable for one person, heck, it was hard for hundreds of us. It was hard, boring work and I'm glad that it's not something we have to do in today's world.

Since the advent of stock trading software like tradeoptimizer all you need to do is look up the stock you are interested in and you can find out basically any technical information you want. Some software will scan the whole market for you and tell you what stocks fit your criteria. This saves people literally hundreds of thousands of hours yearly. I can't even fathom the number of hours I would have banked over my lifetime with a calculator on my desk figuring out how much earnings ratios had changed.

online trading can expose market conditions and history for anybody who is paying attention.

It takes a little research, but snap shots of market history and conditions are available.

Probably the most important thing is to recognize the different bubbles that come along. This is where the strength of on-line stock trading and options trading can be front and center. So much data is within our grasps. There is no reason to float up in any bubbles up higher than you want to go. Acting as online stock brokers or online brokers, the data is all at our fingertips.

In the 1990’s, we had the technology stocks bubble. There was to be no end to the rise in technology stocks.

The internet had reached a critical mass of sorts, though it was (and is) still evolving; yet, like the rise of past communication systems — telephone and ra-dio– there was a great run up in the stock of many companies that really had no viable business plan.
IPOs were made on the basis of guarantees that held no more heft than a cool breeze in the tropics. Venture capitalists emptied their pockets into the piggy banks of kids still in college that started companies with names that sounded like a baby talk, such as “Google”.

A few obviously made it, Google being the shining example. Most startups of the time didn’t. Even some older companies that had a firm history in technology left their straight and narrow and tried to innovate way beyond their curve, most with disastrous results.

Then September 11 interrupted the markets and threatened to send the country and the markets into a tailspin. Interest rates were lowered and even though many had lost millions and billions in the tech stock bubble, the easy and now cheap money was pouring into a so-called bedrock investment: real estate.

There have always been bubbles and crazes. Just ask the Dutch, who saw tulips trade for more than gems centuries ago. The insanity of the crowds not wanting to be left out creates a “me too” type of thinking. All the lemmings buy.

Real estate has always had a speculative side. Levittown, NY, the first mass market tract housing suburb, was built mainly on speculation. However, it was not pie- in- sky, as a number of factors such as better roads, returning World War II service men and the longing to leave the inner cities came together in the right factors to make the smart money spend a little there.

Today’s issues in real estate have been intensified by government distortions in the lending standards and free and easy money. These two tines of the pitch fork have been added to a third prong of packaging up this devil’s brew of promises and selling them across the world.

All is well and good when the bubble is floating upward; a real stab to the heart when the bubble starts to lose elevation.

It was quite a ride up yesterday.

Never in my time doing online stock trading and options trading has there been anything like it. Of course, it was a record increase, so it’s all history.

It is really a matter of confidence. If most of us believe that the markets have been stabilized, then stocks will continue to perform to the plus side. If not, then this will only be a temporary rise. The panic has not reached the retail level yet, but last week it was close. Perhaps last week was the bottom.

Now, for anybody involved in online stock trading, including individuals as well as online stock brokers, there is the question of what stocks and opportunities are out there. Some businesses have suffered real losses, and even if the stock market indices race upward, there is no guarantee that the businesses that have lost so much capital can recover and prosper.

I pulled out my research from last week and looked through it. I had looked into a number of market sectors, with the idea that sooner or later a bottom would be reached, and that there were solid investments to make.

I looked again at the financial sector. Now that the US government is going to be buying stocks in large banks, some of those might prove interesting. My focus, however, will be on those banks that were never in any jeopardy of folding, because they had not been involved in making or holding any sub prime paper. There are a few of those.

This kind of makes for a strange situation. Should I buy into the well managed banks, which were never in trouble, and most likely won’t be in trouble. Or do I buy into the larger banks that will be partially owned by the government? Will the “government” banks actually be unfair competition to the ones left in the free market? That could be. And if so, their stock prices will remain depressed.

It was quite a ride up for the markets, and it will probably go up again today. I just wonder how long the upside will be sustained, given that a plan of some sort has to ultimately show results. I guess there is that window where the confidence will remain high due to a grace period, but if it becomes clear that confidence is still low, things will begin to sell off again.

Only time will tell on this. We are in completely uncharted territory. Some fortunes have already been made, and more will be made. It’s just going to take paying attention to a lot of detail.

We have a small club that meets to discuss stock trading and options trading. It’s not an official club of any type; it’s just a couple of us meet for breakfast very early twice per month on a Saturday.

We’ve had a lot to talk about, lately.

The subject of short selling has been hot recently. Some — like me– argue that it’s necessary to have short sellers in order to keep some stocks liquid and to eventually determine a bottom.

Some of our club disagrees, arguing that there is a conspiracy to drive down the price of certain stocks and then make a killing on what you know is going to be a lower position. I can believe this, too.

But, I’m not sure you can regulate such a thing.

At this point, I don’t know if anybody is certain what is going on.

Even in this age where I can keep track of my portfolio with a click of a mouse, I’m still confused. Maybe uncertain is a better term. Online stock trading has made my life easier, at least, in the respect that I can execute the trades I feel and think I have to make much more easily than ten and fifteen years ago.

The club met last Saturday and talked about the bailout — or “rescue plan” for some time. Most of us are convinced that it is neither. The banks and all purchasers of derivatives have not been saved by any means, and those who have gotten into homes with sub prime mortgages and interest only loans are still faced with the same risk.
On the way to the meeting I counted the number of “see through” houses (empty houses), and I saw way too many.

I’m cautiously optimistic that the action by Congress may stabilize the US markets for a short time, but going forward is unpredict-able, as we are in a global economy, and nobody can trace all the bad paper.

Most of the others in the group believe the same thing, that the only thing certain is uncertainty.

We paid our bills and then left.

When I first started online trading, my favorite things to buy and sell were transportation companies. Many sectors of the market had been deregulated for about a decade, and the real win-ners and losers were starting to be decided.

At that time I was working in the transportation industry, and was keeping on top of all the changes, because I had to for work. This, I felt, gave me an advantage on any stock broker, online stock trading or online trading.

I divided the sectors.

There was surface transportation, air transportation and sea transport.

All three had their troubles at the time, especially surface. There were a number of the old line surface hauling companies that were suffering. They were up against stiff pricing competition from upstarts, which didn’t have the same costly overhead to deal with. These upstarts, in-itially, were eating the established trucking companys’ lunch. In fact, they were eating the breakfast, lunch and the dinner.

Ultimately, the industry consolidated, and put pressure on the upstarts and through pricing and good infrastructure, managed to get rid of many serious challenges. Once the industry consolidated, it made choosing winners and losers much easier.

Even those companies are cyclical; they still represented respectable buys, especially at the low point of the cycles. The survi-vors would and could weather the storm and will be around even during the bad times.

Rail transport, as a sub sector of transportation, had already undergone major consoli-dations, so it was just a matter of looking very closely at the ba-sics, such as Price/Earnings ratio and Cash Flow Analysis. Once the technology bubble dust settled and the housing bubble commenced, it was easy to see that rail transport would be a winner, as materials for the building had to be moved, and rail is still one of the most economical ways to do it.

Air transportation was trickier to pick winners and losers, especially after September 11.

I made one bad choice, where the carrier went kaput, and I lost all on it. The second choice was much better, as it was a budget carrier and had been long established. Plus, the carrier hedged its fuel options and negated the rising cost of jet fuel as a factor in over all costs.

Sea or Ocean transport is very much a global industry. There are a number of very big players and market leaders, and once again it was a matter of just examining the fundamentals and looking at where the areas were for growth.

Day trading is a practice as old as the markets, but what it really means is that stocks and commodities are being bought and sold in the span of one day. This is the complete opposite to after-hours trading or late trading, when exchanges happen after the trading floor closes for the day. Brokers are then classified sometimes as to the time they begin dealing like day traders, after-hour traders and late traders. To get financial info you should look at telechart platinum.

As a rule, the trading process and methods can be the same, regardless of what time the traders move into action. However, there are certain assets and securities that are being exchanged only during the trading day, such as: currencies, stocks and stock options. There is also a market for many of futures contracts like: commodities, equities, and interest rate futures. I like to get my information from telechart 2007.

There was a time when day trading became the exclusive playing field of financial institutions (i.e. and major pro investors. Other investors who did not meet a certain financial criteria was somewhat relegated to after-hours trading, although this was not a formal option. More recently though, an increasing number of casual traders have entered the market.

There are really a couple of reasons for such major changes. One: technological evolutions (like the World Wide Web) are paving the way for speedier communication and financial transactions. If you consider the online forex trading, lots of people are basically dealing with internet money - although it can be changed into cash at any time really. Finally if you want a second opinion look into telechart.

Plus, casual traders can trade stocks in the investment markets - in all the financial markets, all the time, no matter where the are - even worldwide. When you see that one small investor, then you should think what all the worlds big banks and financial institutions can do that are following day trading profits.

http://www.youtube.com/watch?v=a_FH7MF9gKg

Second: more recent and easier legislation, locally and world wide, have made it easier for lots of investors who don't meet the level of financial criteria otherwise. That means that anyone who wants to, has a computer and internet access, and has a little money to spare (a small a start as $100 will do) can start trading on the net.

In regards to casual and novice day traders over the World Wide Web, the best selling technique so far is short-term trading. As the name suggests, this technique means buying stocks for a very short period of time and then selling it immediately. Following that logic it means that the return on investment can be achieved very fast in a short span of time. Depending on what stocks you're talking about, that technique can be executed in just a short time or as long as a couple of months.

Long-term trading is also prevalent during the day trading hours, but usually, it is the larger financial institutions who handle such affairs. A good example of this is dealing with mutual funds. Assets in the mutual funds can be held by the stock holder for years on end, and some even pass from one generation to the other. The stock holder earns his or her keep by simply letting the stocks grow and partake of the dividends either on an annual, semi-annual or even monthly span.

We had our initial meeting of our online stock trading group. It was a diverse crowd, with men and women of all ages. Our knowledge was all over the board, too. Some of us had been trading for years, and some had never even had a brokerage account.

Jim was the organizer of the group, but was not going to necessarily be the leader. That task went to Sarah and John.

Sarah was a new trader, and John had been at it for many years. He referred to himself as a dinosaur and not very good on the computer but getting better. Sarah was all gung-ho and had recently opened accounts with a couple of brokers.

She thought that this was the best time to buy, but was exercising caution because of the instability of the market. One day it was up and one day down.

Sarah had copied some information from a government web site, which outlined some cautions to take for anybody considering online stock trading and trading options online.

Essentially, the site reminded traders that they are not directly linked to the market, and that when you click to buy or sell, you may not be doing so in real time.
Also, to go along with that, we should make sure that the quotes and account updates are in real time, too. If not, how long is the delay?

Some other things to do are to research the firm for strength on a number of different levels: financial and operational. You don’t want to get involved with a brokerage that can’t prove its financial status, and you don’t want to be working with a company whose web site and computer operations are not state of the art, or are shutting down.

We decided to have a selection of “officers”, so somebody could take charge. Sarah was elected president, and John was to be the vice president. I offered to be the secretary and keep the minutes of the meetings. I thought this would help me to pay attention.

The meetings were to be every other Saturday morning at 6:30-am, at least while the markets were so erratic.