How To Choose The Right Stocks
Q: I was wondering if anyone could give me some good pointers on how to pick good stocks. What is the most successful way to select a good company to invest in?
A:
Do you know what the company does? Have you seen or used
any of its products? Have you any experience with the company
or people that work for it? Do you trust them, or do they
make you feel like washing your hands?
Does it make a profit? If not, do you have good reason to
believe it will make a profit in the next few years?
If it
Does it pay (or plan to pay) a dividend? If not, how are you
going to get a share of the profits?
Nah, the bottom line is that shorting worthless stocks is
gambling or self-defeating stupidity as the case may be. That's
where your effort went wrong: Not because of any similarity
between the nonsense of betting on the pips in a deck or on a
wheel versus buying ownership interests in some real business.
You short a stock, you ARE the demand for that stock. The
market makers know it. Speculative longs who know that they're
trading in trash paper know it. All they need do is look at
that monthly listing that says "Hey! Bill and some of the other
bears are short a ton of this trash paper" and voila, you get a
rally in the "market" for that particular trash paper. You are
your own worst enemy when you short a stock.
The question for picking good stocks boils down first and
foremost to avoiding BAD stocks (the very kinds of crap that
you like to gamble on). For me, there is no such thing as an
AMZN or EBAY. They got excluded from my permissible trading list
so long ago, I can't even remember when they got excluded. For
sure, prior to my ever trading a single share of their outhouse
wipes euphemistically referred to as "shares of stock".
For your side of the question, I should add that Greedspan has
added one helluva motivation for considering stock investing to
be nothing but gambling by encourage criminal thieves to steal
all of the assets out of publicly owned corporations at ludicrous
multiples of net tangible equity with his "stock buybacks" swindle
that he's been promoting since 1987 as the "solution" to all
market fluctuations. Very clever - in its own criminally malicious
way. This makes the ownership of formerly public corporations subject
to the criminal whims of the banks that he, and his cronies,
control directly. Whether to make loans to keep the worthless
crap heaps afloat, who to make the loans to, when to pull the plug
on the thereby made worthless crap heaps so as to wipe out all
those nasty (shudder) capitalists who naively think we own
something in the midst of his criminal communist theft system.
Such stocks are total gambling exercises, made so for criminal
purposes, and the "betting" is on how much insight the bettor has
into the workings of the criminal minds running those shells that
"used to be" publicly owned corporations. So, I exclude that whole
set of stocks at the outset with my Deficit Tangible Equity rule.
Then there's the ones that Greedspan and his criminal cronies
are "working on", with absurdly large loans for ludicrous purposes
such as paying five and ten and fifteen times the value of some
scam of an "acquired company", or for that matter, paying five and
ten and fifteen times the net tangible equity of the company to
"buy back" its own shares, i.e. fraudulently transfer the equity
to the criminal cronies of management, often the very same banks
making the wrongful purpose "loans" so as to pervert publicly
owned corporations into instantly bankruptable shells because of
their resulting Debt Load Egregious.
So, those are the reasons that I emphasized Deficit Tangible
Equity and Debt Load Egregious as first tests that must be run
in excluding BAD stocks from consideration. Anything which has
those features, either of them, truly is a gamble subject to the
criminal machinations of frauds and thieves and criminally corrupt
government swindlers working for fascist statist CONTROL of
economic activity, regardless of the resulting damage to the real
American economy. The tests I proposed are for the purpose of
*avoiding* gambling. Yeah, sometimes it winds up being something
that Greedspan and his criminal cronies simply "hadn't gotten to
yet", which is why the owner must watch like a hawk for signs of
those two criminal machinations of Deficit Equity and Debt Load.
Other times, it winds up being a successful "good stock" as the
original poster requested.