Bush-Era Tax Cuts Extended

Announcements:

• My interview will Hedge Fund Manager, Tim Ayles regarding market outlook and how to trade 2011 will be debuted on December 17, 2010
• December Book of the Month is Aftershock by Robert Reich.  Book may be purchased through the Amazon link to the left of this writing

President Obama announced today that the Bush Tax Cuts will be extended for 2 years.  Markets surged at the open but ended lower with Dow down 3 points, Nasdaq up 4 points and S&P up just under a point.

Whether you agree with the tax extensions or not is your own personal opinion.  As far as the financial facts are concerned, the tax cut extensions will keep the low capital gain tax rate and low dividend tax rate.  So, as far as capital gains are concerned there are no new taxes but the estimated income loss for the government is $600B-$800B. Analysts polled said that the tax extensions will help make the recovery more speedy and easier to gain ground.

European Crisis Update
Hungary has, as of Monday, been added to the list of European countries that are in trouble.  Moody's double downgraded Hungary's debt ratings saying that the leadership is taking no active steps to reducing its blooming debt.  The EU faces yet another issue that could prove to be have a similar solution that transpired with Ireland and Greece.  The Euro lost gains that were posted last week.

Trades:  Stick with the trades advised in "Playing the European Crisis" and "Boosting Returns Using Dividends".

October Book of the Month

Its that time again to designate a book for the month of October.  This month's book is, in my opinion, one of the best books if you like reading about crisis of 2008.  More specifically, the fall of Bear Sterns.

October's Book of the Month is: Street Fighters: The Last 72 Hours of Bear Stearns, the Toughest Firm on Wall Street by: Kelly Kate.

"Street Fighters" is a very indepth book about the last 3 days of Bear Sterns.  Kate documents every move made by the board of directors that were scrambling for every dollar, desparately trying to get a "loan" (bailout) from the US Treasury.  It also takes about how Bear Sterns ended up selling themselves for $2/share to JP Morgan.  I highly recommend this book that describes the fall of the first mighty investment bank on Wall Street.

Here is a quick summary from NY Times:

"The acclaimed New York Times bestseller-updated for the second anniversary of the collapse of Bear Stearns.
The fall of Bear Stearns in March 2008 set off a wave of global financial turmoil that continues to ripple. How could one of the oldest, most resilient firms on Wall Street go so far astray that it had to be sold at a fire sale price? How could the street fighters who ran Bear so aggressively miscalculate so completely?
Expanding with fresh detail from her acclaimed front-page series in The Wall Street Journal, Kate Kelly captures every sight, sound, and smell of Bear's three final days. She also shows how Bear's top executives descended into civil war as the mortgage crisis began to brew."

Best part is through my link, you can buy this book for $2.97 from Amazon.  We recieve a very small commission desparately need some more capital.  Thank you very much for your support!!

Book of the Month: September

This month's book of the month was an easy choice because I really enjoyed and learned a lot from this book. This month's book of the month is: Trade Like an O'Neil Disciple: How We Made 18,000% in the Stock Market by: Gil Morales, Chris Kacher.

Here is an overview of the book:

How two former traders of William J. O'Neil + Company made mad money using O'Neil's trading strategies, and how you can, too


From the successes and failures of two William O'Neil insiders, Trade Like an O'Neil Disciple: How We Made Over 18,000% in the Stock Market in 7 Years is a detailed look at how to trade using William O'Neil's proven strategies and what it was like working side-by-side with Bill O'Neil. Under various market conditions, the authors document their trades, including the set ups, buy, add, and sell points for their winners. Then, they turn the magnifying glass on themselves to analyze their mistakes, including how much they cost them, how they reacted, and what they learned.
•Presents sub-strategies for buying pocket pivots and gap-ups

•Includes a market direction timing model, as well as updated tools for selling stocks short

•Provides an "inside view" of the authors' experiences as proprietary, internal portfolio managers at William O'Neil + Company, Inc. from 1997-2005

Detailing technical information and the trading psychology that has worked so well for them, Trade Like an O'Neil Disciple breaks down what every savvy money manager, trader and investor needs to know to profit enormously in today’s stock market.

If you are interested in purchasing this book, please use the link we will provide you above (click on "buy from Amazon.com")  because it gives Invest Chief a referral bonus that we need to keep the site running (Amazon).  Thank you!!