[thehun69]

I thought we cleared up this issue and let it rest a ways back, but this keeps coming back again and back again. Allow me to clarify some points..

1)TA is the study of price movement/price action. That's it. It is not rocket science and I am unsure as to why people have such a difficult time understanding what it is and why they are overcomplicating the matter. Is it an exact science? Nope, just like FA isn't an exact science, for if it were, then I guess everyones picks would be right 100% of the time, which they are not. No one is always right.

2)This is a question for Desert Cat. You found a stock that is trading at 1/3 book value and think that it will take 2 years to get to full book value. My question is why two years? Why not one year? or five years? or even at all? One of the aspects of FA that turns me away from that kind of analysis is the fact that it completely ignore the driving force of the market...TRADERS. The only thing that will drive that price up, is buying pressure. That's it. Without buying pressure, that stock will not hit your projected bookvalue. Why will traders buy that stock? What is compelling them to do so? I have no clue, nor do I care. When I see buying or selling, it doesn't matter to me why they are doing so, I'm only concerned that they are buying and selling. Why, is extremely unimportant, from a TA perspective. The FA model has many incorrect assumptions, and the key assumption that people will act rationally is wayyyy offside. The model also assumes that EVERYONE will have this economic model and everyone will eventually realize the undervalue of that particular company. The fact is 1)everyone uses different methods of coming up with an economic value using different metrics analyyzing liquidity, profitability, etc, so their model may not be like yours 2) just because everyone has a particular model, doesn't mean that they will act "reasonably", people act in a million different ways for a million different reasons. I am not looking for their motivations, I just assess what is happening in the market. As an example, simply because a company has blowout earnings doesn't mean the stock will go up 10% on the open. Sometimes they have blowout earnings and the stock tanks hard. Ultimately traders, and only traders will make your stock go up, and traders buy stocks for millions of different reasons. If they don't have those economic models as you do, or if they do and don't believe in them, your stock will not go up magically because it is trading under book value.

3)Buffet.. let's just move beyond this. Who cares? Buffet doesn't like TA? Wow, big surprise? But so what? Just because he doesn't understand it doesn't invalidate it on any level. There are many private investors who do extremely well using TA? Why aren't they billionaires, because those billions you see made by the typcial Forbes FA billionares are a function of creating an investment company, attracting investors and all the work and stress and pressures and issues that are related to that buisiness and not as a result of personal investing. Some people just want to trade and don't have the ability to market themselves and raise capital, nor want to. Make no mistake, Buffet is a billionaire through Berkshire, NOT becaue through investing personal funds 40 years ago. It started with him raising $500,000 and moving from there and rasining more money. Those billions were a result of raising a ton of money and from that base investing well with it, and not some guy that started with a paltry $10,000 portfolio.

Lastly, at the end of the day, I tell people this...trade what you know and what you are comfortable with. I am not here to convince you that TA is the best and FA is the worst. However TA is the best...FOR ME. I am comfortable with it, understand the logic behind it and do well with it given my investment objectives and time frames in which I trade, which is typically short term trading (days to a week max). This would not work well with people who are FA oriented which is more the long haul.

Hopefully we can all put an end to this pissing contest and just have threads which will be TA oriented and others FA oriented..it's all about making money...

THE HUN.