Advising Us On Online Options Trading November 7, 2008
Posted by janey in : financial success , trackbackAt age 101, Harry Callahan probably never thought he would be called out of retirement by a bunch of people doing something like online stock trading and options trading. When Callahan began his career at the Chicago Board of Trade in 1927, there were only stock tickers – no such things as online brokers!
He visited our online stock trading group again this morning. He is getting to be a regular. He is typically late, as he has an early morning workout that he does at Cardinal Fitness.
Though he was born way before the first PC, Callahan has his own laptop, and he brought it with this morning. He has many online accounts, and has an active portfolio.
When he first started meeting with us he was more confident that there might be a short-lived panic and a recovery, but as the weeks have gone on, he has become less hopeful.
“The missteps of seventy years ago are being repeated — some of them– and it can’t be good for the markets,” Callahan said today.
He watched the debates, too.
“I’m not believing any one of the presidential candidates has a clue about money and economics,” Callahan said. “This does not bode well for the markets going forward. Remember, after one of them is elected, there is a long lag time before they actually take office. Then, there is the time to get things up and running.”
His advice was to keep very few things long, and if you do, make sure you hedge, because in his opinion the market will fall farther.
“Don’t worry about finding the bottom,” he said. “If a solid stock — and IBM or Apple or another market share leader with a good balance sheet– looks cheap enough, buy it.”
Further, Callahan reminded us that nobody ever went broke taking profits. If any of us were holding stock that was ages old we might want to sell a portion and take some of the remaining profits.
“Remember,” said Callahan, “it was not the stock market nosedive on Black Tuesday, 1929, that caused the Great Depression. It was the tariffs that were put in place, the increase in taxes, and, ultimately, the drain on the economy that FDR’s alphabet soup of government programs that took a panic and made it a depression.”
Callahan had met Franklin Roosevelt.
“He was a good man,” said Callahan, “I met Roosevelt several times. But I would not call him an economically educated man. Neither is John McCain or Barrack Obama. Joe the Plumber — now there is a man who knows economics.”
Callahan then left. He was flying to New York with his girlfriend later in the evening, and he had to get packed.
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