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September 14, 2012 / 74

Gambling At the Wall Street Casino

Why are there so many plungers in the Stock Market these days? Let me esplain how it works…

When I go to a casino (and these days Wall Street is the Monte Carlo of casinos), I walk in with a fixed amount as stake and do NOT bet more than that. I NEVER bet more than I can afford to lose.

Roulette is my game. I start off slow. I win a little here (on Red and Black, odd and even,) lose less, win a bit more and hit my number from time to time getting a bolus of chips so I can play longer. Hopefully at some point I win enough to cover my stake. As soon as I cover my stake, I take those chips off the table and stick them in my pocket.

Then with the remaining chips on the table, I get a bit more agressive. You can’t win bigger if you don’t BET bigger! The play goes, the chips ebb and flow, and after a bit I either win or lose, but IT DOESN’T MATTER ANYMORE because I’m playing with The House’s money now!!! Once I have my stake in my pocket I could lose every chip on the table and walk out the door no poorer or richer than I was when I came in.

So there is no incentive to watch the dealer’s hands carefully – or to rat him out when he looks at the wheel when he throws the ball (he/she’s cheating). I’ll just not bet while that dealer is on the wheel. (Wouldn’t want to make a scene, you know.)

And I also set a win limit. In a casino it does NOT pay to get greedy. If I hit my number three times, I pick up my chips, tip the dealer and staff, and walk out with my winnings.

That’s today’s Stock Market. Everyone is either playing with someone else’s money, so they don’t care. Winning and losing are terms that do not apply to them. Or they aren’t betting – keeping their money out of the game because they’re waiting out the time when the current dealer goes on break or gets caught by the House and gets fired. Or not. If the next dealer cheats too, it’s the House that’s crooked and I don’t play in a crooked House. (I currently do not own ANY stock!)

Unfortunately there also appear to be a lot of people who don’t understand that getting greedy is a fatal mistake because in the long run the House ALWAYS wins.

If you have a 401 K or a “retirement plan” and it has a stock/equity component, you are paying a professional gambler to manage it – and he’s playing with YOUR money, not his own. Think about that.

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