THE GNOMES OF LaSALLE STREET

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"Hermes and the Gnomes of LaSalle Street"

     "HERMES" -my pseudonym (Greek, a.k.a. 'Thoth' in Egyptian), we all know was the Greek god of writing, business, mathematics, teaching the alphabet to the reminants of a destroyed civilization, etc.. I adopted the title as that god has the shortest time cycle of all the Lords of Time (all the planets/gods). He was also the god of liars and thieves. Since my entire background was inimical to the futures trading industry, it was very appropriate I thought to have such a pseudonym for my books targeted to writing about trading and cycles in markets. And Hermes just happened to be the name of a German typewriter I bought, that could do justified print with high-quality daisy wheel script, had memory and lasted longer than my ex-wife. 

     "THE GNOMES OF LASALLE STREET" is the description I used to clarify at least four broker friends of mine that I frequently socialized with in the financial district of downtown Chicago. Also, some of my outstanding clients and trading characters impressed me enough to earn special titles. Each one had his specialty market that he made a healthy living from. "Fat Marvin" for example, is my cover for a retail bond broker I competed heavily with while at Bache/Prudential, who had better been described as "Mr. Wrong-Way Bond Trader." Because his fear factor was so high, he only traded for one or two points at a time. Whenever a position got against him and away from him, he wound up riding out huge losses in the hope of breaking even before exiting, eating up much profit. I always bet against him in position trades his field of expertise, for my clients. 

      Another gnome was "Silver Frank" from Skokie, Illinois. His expertise was both the physical silver bullion as well as silver prices that he had studied back to the beginning of the country. He had traded in many paychecks and savings for bags of silver just after it was announved there would be no more silver coinage for circulation in America. He was very sharp in that he had common sense, over 40 bags of bullion face silver (about 72% bullion per $ 1,000/face coin silver dollars) and a patience for going for the long run (investor mentality). He made a multiple fortune many times his initial investment. And at one time, because we both frequented the same coin dealor, he was courteous and grateful for my services in helping him stay on his plan to generate large profits, that he gave me 8 rolls of B.U. silver dollars as a token. In exchange, I pointed out the possibility of a dynamic bull market in soybeans at that time, and he multiplied his profits many times more. Then he stopped trading as he wanted to enjoy his newfound wealth as well as pay many taxes. But he kept his newfound wealth and didn't try to press his luck.                              

      Perhaps my second best client I had for making me money, was as good as I was in trading, but tought me aggressive, scale positioning technique was "Sam the Wise" from Wilmette. His technical approach and judgement was equal to my analysis almost all the time, using daily, weekly and monthly plot charts for gauging perspective. And his 'buying-' or 'selling campaigns' he did in specific markets, he actually learned from the "Silver Fox "of Wall Street - Jesse Livermore. He didn't care abut the fundamentals, unless there was an exceptional news announcement made. And four times in five years, he and I ran his account to over $ 1 mill. from the $ 50-70k level. He lasted for over six years as my client at three different firms.

      For sheer bravado and staying power as well as keeping to a plan, my hat goes off to "Vasco" (from Texarkana) his real name, for 'long term, position rollforward' trading technique. After trying many approaches in futures trading, he decided to go for the 'Long-Term, Rollforward' technique with me as his broker. (He himself had actually been a stock broker, but couldn't stand the sales industry.) Putting on a long position and rolling it out into the following month contracts at least 7-8 months out, he would capture the bulk of any dynamic bull move that occurred. I had him as a tiny $ 7k account that no other broker would handle as he was too inactive in his trading (no commissions) and would not listen to the brokers who thought they knew everything (ego problems). I also watched his account go to over $ 1.1 mill. in about 18 month's time (from $ 7,000). I saved all the monthly confirms to work out his trading strategy as well. Virtually no one else would listen to my suggesting the profitability of making that type of return on leveraged trading. It didn't fit their concepts!!!! After all, who would BELIEVE that you could get a return of 157-times on your money in 18 months? I do! But it requires patience, prudence and starting from a very low level of commodity prices. Vasco lasted for about 9 years with me as a client, through thick and thin. In 1980, he had huge profits on platinum positions. After obtaining bank financing, he merely took delivery (no selling out of long positions) and transfered the bars to Switzerland. A very smart trader. What he did with them from that time forward was his business.

      One of my clients for futures trading, was also a client in buying quantity of silver bullion by the bag (silver) as well as rolls of gold coin. "James" from Northfield was an eccentric investor, who wanted guidance at many levels of finance. Besides diversifying into other hard asset investments, trading futures and establishing trusts, he was easing out of real estate because of its confiscatory nature. I had become very knowledgeable in learning the grading of coins, the history of money and coins, as well as followed the weekly "Coin Dealor Newsletter" to know- and match the dealors I dealt with. Because of my advanced knowledge of gold, hard assets in general, money laws and changes by our government, etc., I attracted very demanding clients in that area of interest. tHese men wanted to keep their wealth, learn how to deal with the dealors, but not be on any list for any future confiscation by the government as they did in 1933-34. So I became their middleman, protecting them from scheming con artists and incorrect coins when buying in large bulk orders. As a rsult, I used to walk around from shop to coin dealor with specially prepared briefcases that could handle the 62-lbs. or so that a bag of silver weighed, not caring that it was real money I was toting in hand. One time, after having lunch at the 'Sign of the Trader,' the C.B.O.T.'s watering hole, I waited for "James" from Northfield to come down and pick up his two bags of silver I has bought for him right outside the Board of Trade's building, standing over them nonchalantly. Because of traffic that day, he was a little late - and I missed putting on some good Corn trades because of the price action (Corn and Bonds reversed together often), I was able to see his grey Porsche pull up, sunroof open, waiting for his package. I walked over and ently dropped the two bags down his open roof and bid him adeau. Not many people back then would have guessed that a transfer of some $ 80,000 was taking place,  in real money. I decided to keep to gold coin as they weren't so obvious, and easier to carry.





 
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