Black Jack and the stock market.

Back in da day when I was a card counter I played a system called Red 7.  It was developed by Arnold Snyder and was developed for 6 deck shoes. You would watch the cards as they appeared and count in your head.  When a  2,3,4,5,6,and RED 7 appeared you would count +1. When a 10, face card or Ace appeared you would count -1.  Pretty simple.  When your count was +2 times the number of decks in the shoe you had a slight advantage.

This advantage was very small but it was an advantage. If your average bet was $10 using Red 7 you could expect to earn $8 an hour.  This profit is typical of all card counting systems.

The thing is that you would actually WIN when the count was increasing . . NOT when the count was already high.  It was the momentum that brought the profits.

I mention this in regards to the current stock market.

The reason we are in this holding/sinking pattern is not that companies are not making profits. It's because companies are making SO MUCH profits they cannot make MORE.  Like a black jack counting system, the money to be made is when companies are INCREASING profits.

Right now people who buy and sell stocks do not believe a company can make MORE profits, they cannot INCREASE their profits and thus they are not purchasing MORE stocks because there is no where to go but down.

The count is high and cannot go any higher.  Any bad news is a good reason to sell.

The good news is the "tax break for the rich" companies are using their new money to buy back stocks (rather then giving their workers bonuses) which helps the market from tanking on bad news.

Fascinating.

One odd note - I was doing some cleaning (also called stacking) and counted 37 BJ and Poker books . . .anybody need some? LOL   I also still have 25 decks of cards.  I used them for practice. I had cards in every room and my car.  Whenever I was sitting (bathroom) doing nothing I would flip through cards counting. 

It became such a habit that I would start counting ANYTHING.  At a stop light cars going left to right were +1 and cars going right to left was -1.  Then you needed to count AND talk at the same time or else you would be banned (Miss Marquette) if caught.

I was almost caught at The Hole in the Wall casino up north (more of a trailer then a casino actually) when I had The Golden Shoe and won $400 in 15 minutes sitting next to a VERY loud guy playing poorly.   I had to wait for 10 minutes at the cashier before they paid me. NERVOUS!!

ANYWAY - when I was reading an article last night about the market the black jack analogy popped into my head.

Ever since the Las Vegas trip counting has been on my mind.  I got to play at my first single deck table in 2 decades.  I'm pretty sure a woman was counting at our table as she was showing off her memory in a fun way.  Casinos don't hate card counters as long as they make the table a fun place.

One person winning keeps other players from leaving. It's a love hate thing. As long as you don't over stay your welcome and don't win a TON they are fine as long as you make the table enjoyable . . and she did.           

Something I THINK we were doing wrong was not taking advantage of Insurance.  Something you don't see in Wisconsin. Although I have one book of basic strategy that lists when to take insurance and my Red 7 books says NEVER.  I'll have to do some research before next year.

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Speaking of Fox Con - did you know  Wisconsin offered Foxconn more than Virginia and New York did for Amazon  

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WEATHER - Be looking for snow starting about 11PM - pretty tricky forecast but Columbus is right smack dab in the middle of the forecast area so any movement probably won't be felt by Columbus/Madison area.  Looking at 3-4 inches in the middle area and 1 to 3 on north and south sides of the band.  If I had to guess I would say a solid 3 inches.

It will cool off slightly until Wednesday when we get back into the 40s. Lots of sun and melting but rain and drizzle NEXT weekend.     

This weekend - clean up on Saturday with peeks of sun later in the day and sunny Sunday.

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I saw these stools  at a restaurant and vowed NEVER to sit on one