Trading Justice

podcast   The US is in the enviable position of possessing the world's reserve currency: the US Dollar. As the reserve currency, much of international trade is performed in US dollars; particularly oil sales. This is where the term petrodollar originates. With reserve currency status, the US can do things other nations can't, from printing money to pay off debts (if it wished to) to growing GDP by exporting debt to other countries. Other countries that try such tactics tend to end up with hyperinflation and currency collapse, such as Zimbabwe in the late 90s through the Aughts. Even with reserve status, though, such strategy isn't without risk. An economy can be grown only so far through debt, and interest rates staying at record lows for the better part of a decade had delitritous effects on consumer access to debt from banks. How did the US get its reserve currency status, and what is its future with developments such as the Yuan entering the IMF basket of currencies? Join Tim, Matt, and special guest Jeff Crystal as they continue their discussion of central banks and reserve currency in this episode of Trading Justice. applogoapple logo_0034_stitcher tunein-logo  
Direct download: TJ141CentralBanksWithJeffCrystalPt2.mp3
Category:Podcasts -- posted at: 1:21pm MDT

podcast   The FOMC meets this week to determine the interest rate for the US and whether it'll hold to the movements from December. The market puts the movement at virtually zero, while actually backtracking and lowering the rate back down has about a 3% chance. With The Central European Bank declaring a continuation of quantitative easing last week, the world is watching and hoping that the Fed will hold off on raising rates a bit longer due to the general malaise that's currently lingering over markets from the US to China. Despite how serious this (and any Fed) meeting is, it's likely that the average American doesn't really know about it, the meeting's implications, or even care too much about the outcome more than whether he or she will be able to afford a little extra discretionary spending and saving. With the role the Fed takes in the economy, general trading principles, the importance of credit score, and other key financial knowhow not being taught in the school system, it's not too surprising, unfortunately. That lack of education can come to bite you if you don't take the time to educate yourself on how to secure your own financial freedom. Even something as simple as trading into other currencies as a hedge against inflation and other systemic risks can improve one's financial safety. ...and done right with training, you can even make money doing it. Join Matt and Tim for a discussion of economics, politics, and more. applogoapple logo_0034_stitcher tunein-logo  
Direct download: TJ140EconomicsAndPolitics.mp3
Category:Podcasts -- posted at: 11:58am MDT

podcast Implementing options trading as part of your portfolio offers more than just consistent returns through cash flow and compound interest. With proper positioning and timing, writing options against securities in your portfolio can help protect you against a volatile market, as well. It's really a win-win for your portfolio. If the sold option expires worthless, that's cash flow in the bank. However, if you position the option properly and get assigned, you exit a security that would have had an adverse effect on your portfolio had you maintained the position. Yes, you're out the position, but if you were iffy enough to write an option against it for the express purpose of protection, you're ahead in the game. Remember, you can always re-enter that security later if its chart start improving. The old adage applies here, too: the trend is your friend. Do note that timing is important in utilizing portfolio insurance. If you write the insurance covered call while volatility is low, you won't get much of a premium for its sale, and it's likely just a normal covered call that will generate cash flow for you. However, if you wait until the security is already careening in a direction you didn't want it to, it's likely too late to completely salvage the position. It's a simple matter of paying attention to what's in your portfolio and acting accordingly when the time is right. Join the coaches as they discuss the importance of portfolio insurance, the latest news in the markets, and more. applogoapple logo_0034_stitcher tunein-logo  
Direct download: TJ139PortfolioInsurance.mp3
Category:Podcasts -- posted at: 12:00am MDT

podcast Trading anything is never without risk, but some positions can be riskier than others. Options, for example. In the hands of an untrained novice, poorly trading options can lead to the complete implosion of a portfolio over a short period of time. However, with the right training and practice, options can instead become a low-risk cash flow generating part of a portfolio. So it was for Marius as he began his trading career. Most of the traders in his area (Romania) primarily traded forex and stayed away from options due to the perceived risks present. For those particular traders, that hightened risk was likely legitimate as they had no training on it. Marius, however, was undeterred and began researching various coaches and shows until he hit upon a mentor program through Andy Tanner. In this program, Marius eventually met Noah Davidson and learned about the intricacies of options trading, along with all their potential use in a portfolio: simple cash flow, insurance for a portfolio, and more. Marius even started giving back to the community with the creation of a variety of options calculating spreadsheets for his peers to utilize in trading. Join us as Tim interviews Marius Posogan about learning options trading, the importance of creativity to any pursuit, and more. applogoapple logo_0034_stitcher tunein-logo  
Direct download: TJ138CreativityWithMariusPosogan.mp3
Category:Podcasts -- posted at: 3:44pm MDT

podcast What is a central bank? Originally, they were created to provide the nation with a safer, more flexible, and more stable monetary and financial system. Do it still do that, though? According to the FOMC's website, its duties now include:
  • conducting the nation's monetary policy by influencing the monetary and credit conditions in the economy in pursuit of maximum employment, stable prices, and moderate long-term interest rates
  • supervising and regulating banking institutions to ensure the safety and soundness of the nation's banking and financial system and to protect the credit rights of consumers
  • maintaining the stability of the financial system and containing systemic risk that may arise in financial markets
  • providing financial services to depository institutions, the U.S. government, and foreign official institutions, including playing a major role in operating the nation's payments system
The bank still does determine interest rate and monetary policy for the US (and other countries for their respective central banks), but the US banks also have an extra wrinkle as compared to other countries. While a majority of the Fed is staffed by presidential appointees (seven seats, in fact), there are indeed five seats that belong to private banks as part of the agreement with these banks to purchase shares in the Federal Reserve system. These shares can't be sold, but they do pay out interest to their holders to the tune of about 2 Billion a year (with the other roughly 88 Billion going directly into the US Treasury). How does that work, exactly? Why was the FOMC created this way? Join us for the latest Trading Justice podcast wherein Matt and guest Jeff Crystal talk central bank history and policy. applogoapple logo_0034_stitcher tunein-logo  
Category:Podcasts -- posted at: 12:00am MDT

podcast When the market is bullish, securities generally do well regardless of what they are. Utilities? Sure. Oil? Yep. Tech? Buy it all! It's akin to the old expression of a rising tide raises all ships. Sure, there will always be losers. A company may have an off day from a lukewarm product launch or suffer a recall scandal, but when the bulls run, money flows with a greater tolerance for risk. Losses just seem easier to make up Should the bears wander into the market from their forested home, though, the picture turns less rosy. Sector and industry start to play a larger factor in safer trading. Tech becomes specious unless the company is established. Retail becomes more acutely sensitive to consumer confidence. So where does the investment end up? In what are called safe instruments, most commonly. This flight to safety occurs when investors get jittery about the short to midterm future prospects in the market. Just what are considered safe instruments? Bonds used to be the top of the list, but interest rates have hurt them lately. You'll typically see precious metals fare better along with conservative sectors such as utilities, basic necessities (basic housewares & food, healthcare, etc) see a surge in activity. If the market gets too crazy for some folks, they'll outright convert into cash and wait the storm out. Are you considering a flight to safety? Join Matt and guest Keith King as they talk about currencies, commodity trading, and flights to safety in trading. applogoapple logo_0034_stitcher tunein-logo  
Category:Podcasts -- posted at: 12:00am MDT