Guide to the Stock Market

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Gold And Stock Market

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Debate becomes an "all or nothing" proposition. One side must be wrong completely with ad hominem invective. Each side sustains argument with seemingly logical evidence. I suggested to Emily that we fail to find the middle ground within controversy, and we forget the commitment required for action-steps by relying on "talking points". Most of us forget that debate is not a "zero-sum game".



So what about the frogs?

Emily writes, "Global warming could possibly lead to the extinction of many species. When the climate changes drastically, many animals cannot adapt...species are lost forever. If global warming is not stopped, more than a million species worldwide could be extinct by 2050...."

Randolph Schmid and John Heilprin in their article, "Over fishing May Harm Seafood Population" do not address global warming, but their arguments against "over fishing" are strikingly similar.

Schmid and Heilprin quote Boris Worm of Dalhousie University in Halifax, Nova Scotia who says the data about "over fishing...shocked and disturbed (him with)...trends...beyond anything we suspected. At this point 29 percent of fish and seafood species have collapsed...their catch has declined by 90 percent...If the long-term trend continues, all fish and seafood species are projected to collapse within my lifetime - by 2048."

Notice the date? Notice the number of species lost? All consistent with the global warming argument.

So what about the logs (not the ones that float)?

Global warming logs assert that "The average global temperature has increased by about 0.5 degrees Celsius over the last century...over half of that increase has occurred in the last 30 years. Since 1980, the earth has experienced 19 of its 20 hottest years on record, with 1998 and 2005 tied for the hottest and 2002 and 2003 coming in second and third", Emily and I discovered during our research.

Carbon dioxide atmospheric levels have "remained constant at around 280 parts per million ("ppm"). It is now nearly 380ppm, a level the earth has not experienced for at least 400,000 years." Hence, some assert, the rising temperature of the earth...is driven by the consumption of fossil fuels." Clearly, "This rise in temperature is altering the earth's climate, which is leading to many other problems", writes Emily. We are losing entire ecological communities!

Back to frogs for a moment, "Whether we looked at tide pools or studies over the entire world's ocean, we saw the same picture emerging. In losing species we lose the productivity and stability of entire ecosystems," said Boris Worm.

So what about the stock market?

The stock market is about money; in fact Solomon, an ancient wise man (differs from today's "wiseacre") said, "It's ALL about money" (emphasis mine).

Whether we fish to deplete species or we pollute streams, ponds, lakes, and oceans, the results are the same. Manufacturing jobs are lost, the streams that feed economic-villages collapse, and business cycles fail where the ocean feeds cities. Solomon's aphorism applies: where there is no money, social structure crumbles, and stock markets plummet.

Not far from where I write is a popular seafood restaurant called "Woodman's". Essex has a few "Yankee Magazine" seafood restaurants where fried clams and lobster feed salivating tourists every day. Folks travel miles to stand in long lines for a clam plate with french fries or a one pound lobster with cole slaw.

Two men, I know, earn their living preparing food at one of these eateries, another man works the clam flats year-round. Whether global warming or global pollution disrupts their income, the results could devastate all of them, and our community.

Former World Bank chief economist Sir Nicholas Stern was commissioned by the British Treasury to study the economics of global warming. Stern's credentials are impeccable. His rudimentary conclusions warn governments that global warming must not be debated.

Any failure of government leadership to reverse "the trends" could lead to "the kind of downturn that has not been seen since the Great Depression and the two world wars", says Britain's chief scientist, Sir David King.

This is a formidable challenge for our global political system. In a world where consensus is eschewed, collective decision-making is an obligation of every nation, tribe, and people. Will we see the collective leadership necessary to grapple with these complexities?

Recent history does not encourage us. For example, it would have cost Thirty million [US] dollars to install an early-warning system to avoid the 150,000 deaths caused by the Asian tsunami. Prior to this climatic disaster, governments would not spend it.

Next April, Emily and I will spend a week tearing-down and building-up homes in Slidell, Louisiana. (New Orleans is across the bridge.) Original settlers built ships and manufactured bricks within a farm and timber region.

Slidell is now a bedroom community for the aerospace industry. NASA has a computer complex and test site nearby. Seafood and meat products, furniture, chemicals, boats, concrete, apparel, and machinery are all produced by Slidell's residents.

Nine major industry groups, many publicly traded companies tied together by grocery stores, barbers, doctors, and movie theatres keep this community intact. As you know, Slidell suffered severe damage from Hurricane Katrina in 2005.

Corporations and governments must face tough decisions or whimper regrets to constituents. As voters, citizens, workers, and parents in our local and global economies, we are obligated to challenge our children to study, our politicians to plan, prepare, and act, while our religious leaders pray for wisdom.

Neglecting these issues imperils the hopes and lifestyle of every earthly inhabitant. Our choices may determine how many more generations enjoy the sight and resonant croak of a rotund bullfrog squatting on a log (that floats). How will you help? Our choices could determine the bottom line of every portfolio, including yours.
Gold And Stock Market
Most people get their introduction to financial trading through the stock market. After all, it is the oldest and largest financial market in the world, right? Wrong! The forex trades over $2 trillion (with a "T") a day, and has been around as long as money itself . What's more, the forex is even easier for individuals to participate in than the stock market-and best of all, there are no commissions on forex trades!

That is one difference. But there are also plenty of similarities. Since most people have a relatively strong understanding of the stock market, and many may be considering a move from the stock market to the forex, this article will explore the differences and similarities between the two financial markets.

Differences

As noted above, there are no commissions on forex trades. This is because everything is done electronically. In fact, there is no physical place known as "the forex" -- it exists entirely in cyberspace. That makes for much lower overhead, hence the "free trades" (see similarities for why trades aren't exactly free), and also allows for a twenty-four-hours a day trading platform, five-and-a-half days a week.

Secondly, while many stock-market investors use margin, most don't. In the forex, everyone uses margin -- and to a much larger degree than anyone uses it in the stock market. In the stock market, margin is capped at 50%. This means that if you have $5,000 in your account, the maximum value of stock you can purchase is $10,000. But in the forex, typical margin ratios are 100:1, meaning you can control $100,000 of worth of currency with just $1,000 in your account! This is one of the major appeals of the forex.

Thirdly, while there are 13,000+ stocks for stock-market investors to follow (and even more mutual funds, ETFs, etc.), there are essentially eight major currencies (and only seven currency pairs) for forex traders to follow.

Similarities

Well, forex trades aren't exactly "free." Just like in the stock market, there is a bid/ask spread. What this means it that the market maker will pay you less for a currency than the price for which he is willing to sell it to you. For example, you may be able to buy $1 in U.S. currency for $1.0905 in Canadian money, but when you want to turn around and buy back Canadian dollars, you will have to pay more than one U.S. dollar to get back your 1.0905 Canadian dollars.

Perhaps the biggest similarity between the stock market and the forex is the use of technical analysis -- also known as "chartology." Technical analysis principles hold up no matter what asset is being traded, so if you've become a master candlestick-reading stock trader, you can easily apply your talents to the forex.

Finally, when placing a trade, many of the same options are available in the forex as in the stock market. Limit orders -- which set the maximum price you're willing to pay or the minimum price you're willing to receive -- can be used in the forex just as with stocks, as can stop losses.

In Conclusion...

There are a lot of similarities between the stock market and the forex, and some experience trading stocks is a good thing to have under your belt. But far superior is experience actually trading currencies, and this is not a Catch-22. You can trade currencies before you really join the forex by opening a forex practice account. Most forex brokers offer these accounts, free of charge, which let you get your feet wet without the risk of getting soaked. Learn all you can about the forex, try out your strategies in a practice account, and in little time at all, you'll be ready to swim with the big fish in the biggest pond in all of finance -- the forex!
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Both A Raymond Randall & Anthony Mullen are contributors for EditorialToday. The above articles have been edited for relevancy and timeliness. All write-ups, reviews, tips and guides published by EditorialToday.com and its partners or affiliates are for informational purposes only. They should not be used for any legal or any other type of advice. We do not endorse any author, contributor, writer or article posted by our team.

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