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Non-Stocks Archive

“Trading a Life” – My Story (Part 1)

If you’ve read my bio, you’ll know I’ve been very sick the last few years, confined to my home, and learned to trade because of it.  When I heard James “Rev Shark” DePorre’s story of learning to trade after going deaf, losing his job, and his wife, I could relate (except the wife part).  But other than his hearing, I guess Rev’s health was ok.  Mine’s not.  Here’s my story.  I wrote this for a trader friend of mine.  However, it seemed fitting to post it here today, on my birthday, as I reflect on all that has transpired.

Why do we trade? There are as many reasons as there are traders, but the reasons are probably similar. Intrigue, gambling, occupation, and, for a few, because you’re actually great at it. In early 2006, a few months after college, I dipped my toe in the markets for sanity. I traded to escape reality. I traded to have a purpose. I traded so the people on CNBC could keep me company.

I was a complete market retard at first. Didn’t even know how to use Yahoo! Finance. True, in addition to engineering, I majored in mathematical economics, but I never cared much for finance. Only spent an hour per week on finance versus seventy or eighty on engineering. Being an engineer was my dream. Always loved figuring stuff out, having some vision in my mind, then seeing it come to life. Same reason graphic/web design was a hobby- I got to share my visions with others. But finance? Did it because I promised my dad I would.

So you ask, Jeff, why do you trade now? In short, life happened. I was born with asthma as well as severe skin and food allergies. I took a gamble on an immunosuppressant shot to deal with my allergies, hoping for a chance at a normal life. I wanted do what my friends were doing. Brand spanking new careers. Grad schools. Or just going out. But this shot nuked my life. My health, which had been sliding downhill since birth, simply fell off a cliff. My life and dreams went with it.

I looked like I had third degree burns or worse. Not a single clear patch of skin anywhere, only infections and leaking wounds that wouldn’t heal. My system was in chaos. Everything doctors tried made it worse, including the steroids I’d fall back on during emergencies such as this. Painkillers were off limits too. I was constantly itching and in pain. My mind also started to go. I didn’t know who I was, couldn’t comprehend much at times, and had trouble forming coherent speech. It might’ve been side effects from the shot, or simply a hysterical panic attack. I couldn’t cope with my new reality. I couldn’t see tomorrow. Little Orphan Annie stopped singing. Like P.O.W.’s, I felt “broken.” For two years, until a few months ago, I barely left my house, my room, and often had trouble just getting out of my chair.

One afternoon during these “early days” after “the shot,” I halted my channel surfing on CNBC to the screaming of Mad Money’s Jim Cramer. The show was packed with information and, for the first time in months, I didn’t feel brain-dead. At that moment, I became involved with the market. Doesn’t matter what people say about Cramer, even if every call he makes from now on is wrong, Cramer has my deepest gratitude for doing Mad Money that day.

I couldn’t have discovered the markets at a better time. Days get pretty long for someone without a job and can’t run the errands that fill up people’s days. Friends I’d chat with online had moved on with new lives. I woke up at odd hours while my parents were asleep, losing a bit more of my mind everyday as the loneliness set in. The markets gave me something to focus on, and it was accessible online. Like most beginners, I started on Yahoo! Finance. I signed up for way too many newsletters, forums, and even the Wall Street Journal. My dad had bits and pieces left from a portfolio he owned during the tech bubble. This was my starting capital.

I dove into it like every other naïve, innocent novice out there. Just because analysts and newsletters said Caterpillar’s stock was a buy, I believed them. I love the big yellow “CAT” dumptrucks. They were everywhere on National Geographic and Discovery shows! I sold the shattered pieces of MRV Communications my dad still had, and bought Caterpillar, all at once. Yes, everyone knows that’s a very bad idea, but I didn’t. I really didn’t know anything. Seemed ok at the time. The markets kept going up in spring of ’06. Easy! Sure helped my self-confidence and emotions. I thought, maybe I could make a living from my room! I saw other stocks, like Peru’s Southern Copper, go up everyday, much faster than my Caterpillar. China needed a lot of copper to build a city a day? It made sense. I bought the story and the stock. Again, bad idea. I know.

Focusing on the markets helped me get through the day. Any little thing that went my way was a big boost because everyday my health got worse. My body was simply overwhelmed by infections and allergies. I wasn’t handicapped, but my parents had to do everything for me, especially since I couldn’t touch water (hadn’t been able to for years). I was so weak my kneecaps would pop if I forgot to clench my muscles for even a moment. I hobbled to the bathroom or crawled there on my elbows. My skin was rotting, especially on the legs where I had the shots, and considered amputation. I was constantly on edge, uncertain of what I had to face tomorrow. Sometimes I wished I had cancer. At least I’d know what I had.

My sleep schedule was random. When I wake up or pass out was up to my body, not me. I was always exhausted, staying awake for only a few hours. I was mostly nocturnal. Daylight gave me migraines. The daytime heat irritated my rashes and often caused hot flashes.

Everyday I was woken up by pain, then cried out in pain while bandaging myself for the next hour. By the time I was done, my heart felt like it’d go into shock, and I’d collapse in front of the TV. I’d turn on CNBC, watching Squawk Box (3am here on the west coast) or a late replay of Mad Money. The anchors at CNBC were the only people I saw everyday and the only familiar voices I’d hear. They became my “friends”: Joe’s unique sense of humor; Mark’s quirky attitude; Erin’s engaging interviews; Dylan’s intuitive explanations. I even watched WorldWide Exchange from 1-3am. Yes, Ross Westgate in London, someone in California knows who you are!

These wonderful people kept me sane, and I dreaded the weekends when they were off air. When they were, I’d do research mostly by listening than web browsing. My eyelids hurt, and so did my bandaged fingers. I played Jim Cramer’s “Real Money” radio show (which he was still doing at the time) on weekdays, and conference call after conference call on weekends. Boring? No kidding! But I didn’t hurt as much when I had voices to focus on.

The good times making money on Southern Copper lasted for all of two weeks. The markets, especially metals like copper, went down hard in Summer ’06. My plan of buying, holding, making money, and living off of my “investments” suddenly sucked big time. The portfolio was worth less everyday. I couldn’t understand why. The “work” I did for months seemed worthless. (I realize now it’s just part of the job.) I was frustrated I couldn’t talk to the people on CNBC, or anyone, about this. I was angry I couldn’t be up while the markets were open, often thinking “if only…” Even when I was awake, I’d forget what I was doing. As I said, my mind wasn’t always there. This stress wasn’t healthy and I got even sicker. I couldn’t take it anymore. I sold Southern Copper and others I’d lost the most on…at the bottom. By the end of the year, Southern Copper had nearly doubled from where I sold it.

Everyone’s been there. Bought at the top, sold at the bottom, lost money, only to watch it go back up and laugh in your face. I felt worse because it was “my dad’s money.” Like everyone else, I wanted to give up, but I had something going for me. Something more painful than losing money: my reality. I needed the markets to focus on.

My mom said to consider the loss as tuition paid. I had learned a lot. I learned not to get emotionally married to any stock. I learned to sell, to think for myself, and to get back in.

It was impossible to watch the markets all day, even though I was always home. I worked around my unpredictable hours, taking a longer term “investing” view. I bought stocks I wouldn’t be afraid and confused about if they went down while I slept. Going along with my nocturnal hours, I caught up on news in the peace and quiet of the night, away from the market frenzy during the day. I even thought of myself as a “Night Trader,” the slow, languid counterpart of hyperactive “Day Traders.” I still bought and sold when I felt necessary, doing this early in the morning if I could. When there were economic or company announcements, I tried to get up for them. Then I’d pass out again.

Finally by the fall, my health stopped getting worse thanks to help from QiGong (Chinese internal energy exercises). Things weren’t rosy, but they weren’t in freefall anymore. That’s enough sometimes. My health improved a bit, then deteriorated some, but the worst was behind me. My portfolio made up some lost ground too, ending down slightly for 2006. Not bad for my first year, all things considered.


Videos Tracking My Health Developments

Bloomberg: Fed, ECB, Central Banks Lower Rates in Coordinated Reduction

Allied forces finally comes together!  wow what a historic day. I’ve been saying that everyday this year.

Oct. 8 (Bloomberg) [By Scott Lanman]  — The Federal Reserve, European Central Bank and four other central banks lowered interest rates in an unprecedented, emergency coordinated bid to ease the economic effects of the financial crisis.

The Fed cut its benchmark rate by a half point to 1.5 percent, the central bank in a statement. The ECB and central banks of the U.K., Canada, Sweden and Switzerland are also reducing rates, the Fed said in a statement.

“The recent intensification of the financial crisis has augmented the downside risks to growth and thus has diminished further the upside risks to price stability,” according to a joint statement by the central banks. “Some easing of global monetary conditions is therefore warranted.”

To contact the reporter on this story: Scott Lanman in Washington at slanman@bloomberg.net
Last Updated: October 8, 2008 07:04 EDT

Fed, ECB, BOE, China Cut Interest Rates as Credit Crisis Hammers Economies

Skin Biopsy & Allergy Test Results are Back

Skin Biopsy & Food Allergy Blood Test Results from 9/10/08 trip to University of Utah Medical Center

Biopsy: Ok, as expected.
dermatitis w/eosinophil
thickening of skin, inflammation
no evidence of underlying tumor of lymphnodes

IgE: 20,111

Food Allergy Tests using blood samples
BAD if > 0.1 ml

Apple: 34.1
Beef: 3.6
Broc: 15.6
Chicken: 14.4
Cabbage: 21.6
carrot: 20.6
Lettuce: 9.8
Milk: 48.8
Peach: 39.4
Rice: 24.2
shrimp: > 100

Utah Medical Trip Update – 9.8.08

PICTURES FROM FIRST VISIT IN JUNE ’08 (vs. this video of 3rd visit)

Condition of Neck and Shoulders while on Steroids

Condition of my Back on 7/18/08

condition of Left Leg on 7/16/08

Congressman, Please Vote “YEA” On the Financial Rescue Bill

Hi Congressman Miller,

Thanks for voting “Yes” on the Financial Rescue Bill for our country on Tuesday, 9/30/08.  Sadly, the majority did not understand the gravity of the situation and voted against the bill.  Please vote “Yes” again tomorrow, despite the revised version having a lot of differences with the original bill.  From what I see here on the ground, and through friends and family doing business throughout the world, the world is falling off a cliff. Not only did we lose 777.68 on the DOW on Tuesday, equal to $1.4Trillion, double the cost of the bill, but the after effects of that loss throughout the economy into our GDP is several times greater.  We need to save our country, our way of life, at any cost.  $850B is a pittance to what we’d lose if we don’t act.  Please deliver my message to the rest of Congress. Thanks

~Jeffrey Lin, Rowland Heights, CA

This is the first time I’ve contacted my Congressman.  I’ll admit, I didn’t even know I had one!  (just kidding, it’s like a bellybutton, everyone has one)  But I don’t know the man’s policies, what he ran on, or what he’s done for my community.  But at this crucial moment in history, bigger than 9/11, Vietnam, or any other event other than WWII in the past century, will the decisions we make at this moment mean so much for us and future generations…the path history will take.  Congressman Miller voted YEA on Tuesdsay, 9/30, and I hope he’ll vote YEA again Tomorrow, Friday, 10/3.  If he does, he’ll have done more good for me and everyone in America than he’ll ever need.  Call your Congressman- make sure they do the same.

Utah Medical Trip Update – 9.8.08

Jeffrey Lin’s 3rd trip to the University of Utah Medical Center

TRANSCRIPT (for the hearing impaired):
Hey everyone, this is Jeffrey Lin coming to you on location from the University of Utah guest house.  How about that view of Salt Lake City in the background huh?!?  Can’t help but feel good with scenery like that!

Today’s Wednesday September 9th, 2008.  I’ve been here for 2 days- flew into Salt Lake Monday morning.  This video is just to update everyone who loves me about this 3rd trip to the University of Utah medical center. Read the rest of this entry »

My Alma Mater Harvey Mudd College Continues to Outperform!

Looks like the new kids are doing a good job of holding down the old fort! Now let’s keep it that way.

HMC Named Leader in Ph.D Production

“Jul 22, 2008 – Claremont, Calif. – A new report by the National Science Foundation (NSF) lists Harvey Mudd College (HMC) as the leader among private baccalaureate colleges in the U.S. in the percentage of graduates who go on to earn Ph.D. degrees in science and engineering.

The report, issued by the Division of Science Resources Statistics, traces the baccalaureate degree origins of science and engineering (S&E) doctorate recipients from 1997 to 2006 and ranks them by doctorate recipients per hundred. California Institute of Technology, classified by the Carnegie Foundation as a doctorate-granting institution with high research activity, was ranked first with 35.2 doctorate recipients per hundred bachelor’s degrees awarded nine years earlier. HMC, classified as a baccalaureate institution because it grants only a bachelor of science degree, was ranked second at 24.9; Massachusetts Institute of Technology (doctorate granting, high research) was third at 16.6; and Reed College (baccalaureate) was fourth at 16.6.” full article >>

Princeton Review Names HMC One of “The Best 368 Colleges”

“Jul 30, 2008 – Claremont, Calif. – Harvey Mudd College (HMC) is one of the nation’s best institutions for undergraduate education, according to The Princeton Review.

The New York-based education services company features the college in the 2009 edition of its annual guidebook, “The Best 368 Colleges.”

Only about 15 percent of America’s 2,500 four-year colleges and two Canadian colleges appear in the book, which offers two-page profiles of each school and student survey-based ranking lists of top 20 colleges in more than 60 categories. ” full article >>

Fast Money’s Joe Terranova Says Nat Gas June Highs July Lows?

Coming into July, we were riding the Natural Gas high like we had a straight shot to the moon, especially off big shale announcements like Chesapeake (CHK)’s Haynesville Shale venture. Sure, nothing goes vertical forever and we all knew natural gas would have to “correct” for a while. However, for us at-home mom-and-pop non-commodities traders, a lot of the time it felt like we’re just riding this straight shot to the moon blind.

Thankfully, veteran commodity trader Joe Terranova on CNBC’s Fast Money had a simple rule of thumb to offer: June Highs, July Lows. Does it always work? Of course not! Market’s aren’t that easy! But I did a little check and found this rule of thumb is a good one any of us with natural gas exposure to keep close to heart. I used charts from the Federal Energy Regulatory Commission’s Natural Gas Market info- one of my favorite research tools I’ve collected at my SuckingLess.com website.

FERC Natural Gas Market Overview - Daily Henry Hub Spot Prices 2002-2008

As you can see, other than the out-of-norm Katrina event in 2005, July natural gas prices have generally been lower than June prices. This weakness seems to persist from July into early or mid august. While natural gas prices in the following December-Januarys are usually higher than the July-August weakness, there are a few years where Natural Gas prices just keep sliding the rest of the year. I suppose Natural Gas prices still depend on the weather and how much of it is used, so it still has that random factor that we should all be aware of.  Personally, I think selling some Natural gas, whether taking partial or full positions off, seems like a smart thing to do given historical trends suggest July will be lower than June. Sure, you might miss another “Katrina” spike, but that feels more like rolling the dice.  Because I didn’t want to be completely out natural gas in case we get the hurricane spike, I’ve kept 25% of my HAL position, but bought USO puts against it.

However, this year, Natural Gas prices have been on a steady climb alongside crude oil’s climb, natural gas looking much less volatile than in the past. Natural gas isn’t a direct replacement of crude oil, but there are various users of energy who can switch between the two. When crude oil gets too expensive, they would switch to natural gas, thus increasing natural gas’s demand and raising it’s prices alongside crude. Jim Cramer offers a separate rule of thumb: Natural Gas prices trade at roughly 1/6 the price of crude oil. So, at the moment, either crude oil is too expensive or natural gas is too cheap

Also, I have offered the analysis of the trend to use much more natural gas for electrical power generation by utilities around the world. This should decrease some of the volatility in natural gas prices as demand becomes more consistent to produce consistent electrical power. Still, we need to do something about our limited storage capacities!

Remember, beyond just owning the companies, dig just slightly deeper into the businesses the companies are in. That’s why I started SuckingLess.com, to collect the most relevant industry magazines and information useful to investors.

SuckinLess.com Research Resources Used:

**Disclosure: I am long of CHK, HAL, and USO puts as of this post**

This is the training I need to get ready for the markets everyday

Sucking Less Feature: EarningsWhisper.com – The Most Recent Earnings Expectations, A.K.A. “Whisper Number”

To kickoff the launch of SuckingLess.com, I’m going to feature some of the best submitted resources SuckingLess.com users are recommending. We kick off earnings season today with Alcoa (AA) earnings, so EarningsWhisper might be the most useful site overall for the next few weeks to stay on top of the barrage of earnings to come. If you don’t know already, “whisper numbers” are the more up-to-date earnings expectations instead of the out-of-date analyst expectations you find on a Yahoo Finance. Companies and their businesses are constantly changing, and Wall Street analysts and fund managers are constantly in-touch with these companies. However, the updated expectations only exist on email correspondence between the companies, fund managers, and analysts and don’t make it into the public. So, when a company reports earnings “Better than expected” and falls or “worse than expected” and goes up, it is because those “expectations” were out of date. Rather, the company’s earnings and the stock’s move was probably more related to the “Whisper number”. Check out my listing of EarningsWhisper at SuckingLess.com to learn more.

**Disclosure: EarningsWhisper is an affiliate of SuckingLess.com**

Chesapeake Rocks the Haynesville Shale

If investors have “reserves” (pun intended) about the amount of oil and gas in the Haynesville Shale, Chesapeake CEO Aubrey McClendon sure isn’t. The man is confident, and has the actions and results to show it.

Chesapeake (CHK) and Plains Exploration (PXP) and Production just entered into Haynesville Shale joint venture to drill some 6,875 wells, estimating the Haynesville Shale to hold 23-44 trillion cubic feat of natural gas equivalent after deducting an assumed 25% average royalty burdened. This is just shortly after McClendon commented at the annual meeting that the Haynesville Shale probably holds more natural gas than anyone expects. Probably as much as the U.S. uses in one whole year. Haynesville is starting to look better and better.

If you believe in McClendon like I do, I’d research the Haynesville Shale as much as I can.  This looks like a real money maker…feels like Texas in the old days, or like being in “There Will be Blood“.  I’ve found a great website to keep tabs on the Haynesville Shale and listed it on SuckingLess.com, my new investors resource site.

Chesapeake has a conference call this morning on the joint venture with Plains.  Be sure to listen in. I know I will.

**Disclosure: I own shares of CHK as of this post. **