My great grandma – everyone called her “Ma Snyder” – lived on a beautiful stream called Big Stoney Creek in the southwest part of Virginia.
And about a mile from her house, at the end of the creek’s rapids, – our favorite swimming spot – which we all referred to as the “Blue Hole.”
I was about six when I took my first trip down this natural waterslide, and I still remember the shock of hitting that cold water at the bottom – and being tumbled head-over-heels by the force of the water.
I clawed my way toward the surface – and air – thwarted by the stream’s strong current, which seemed intent on holding me down deep. Gasping, I finally made it.
Pretty scary stuff for a six year old.
One of the local kids had watched my battle with the water and told me how brave I was to try the daring slide.
Then he offered some surprising advice…
“Don’t fight the water – just go with the flow,” the swimming-hole Socrates told me. “In just a couple of seconds, the water will naturally push you to the surface.”
On my next trip down into the Blue Hole, I tried it his way, letting the current push me along – instead of fighting against it.
Sure enough, I was lifted right to the surface – without the exertion, the terror and the risk of my first trip down the rapids.
In fact, it was actually a thrilling ride – a pleasurable experience that I subsequently repeated over and over and over again.
Here’s why I’m sharing this story: The “go-with-the-flow” mindset that allowed me to safely navigate the natural Blue Hole waterslide is the very same mindset that will let 10-Minute Millionaire traders navigate the stock, bond, commodity and currency markets.
In both cases, it’s an approach that maximizes the return you get (fun at the swimming hole, wealth in the markets) on your efforts. It keeps your effort to a minimum. And it virtually eliminates the risk of drowning – something you want to avoid whether you’re swimming or trading.
Let me show you exactly how this lesson applies to the current “Trump market,” and our brand new infrastructure play…
The “Big Three”
I talk all the time about the importance of understanding the market “narrative.”
It’s essentially my initial investing “screen.”
And by “going with the flow,” you’re looking for trades that are consistent with the market’s current direction.
Here I feel the need to make an important distinction. What I’m looking for here is what the market is telling me – not what all the pundits or the so-called “conventional wisdom” is saying.
And in the stock market, the current narrative is this: Investors have been optimistic – even confident – that the Trump administration and the Republican-led Congress will be successfully in achieving their “Big Three” initiatives:
- Cutting taxes – indeed, reforming the U.S. tax system.
- Slashing regulation – in effect, cutting costs for Corporate America while giving U.S. companies more room to maneuver.
- And boosting spending on infrastructure – a $1 trillion spending program that will fix the country’s roads, bridges and water systems, while creating jobs and giving the economy a needed jump.
Any news that supports this narrative causes stocks to rally. And any developments that threatens this confidence causes share prices to stumble.
Many of the “pundits” claimed that last week’s Republican “failure” to overhaul Obamacare represented a change to the narrative.
But it’s just not true.
After the U.S. markets closed Friday, the Republican sponsors of the healthcare reform bill pulled it from consideration on the House floor.
And while this was certainly a setback for “Trump Agenda” optimism, it didn’t have any real impact on the market.
Between Friday’s close and Monday’s low, there was only a 1% drop in the Standard & Poor’s 500 Index.
That’s not a market that is throwing away the narrative just yet.
Let me show you what I mean…
Fact is, if our optimistic narrative were in any real trouble, stocks would have been hammered.
But that didn’t happen.
In fact, the swift failure of this healthcare plan might end up better for the market in the end because it allows President Trump to focus on what Wall Street really wants – his economic agenda.
The market’s (lack of) reaction proves that investors are confident that the Trump administration will be able to push through its “Big Three” platform initives going forward.
We’ve already seen the Trump administration flexing its muscle with its infrastructure platform.
Yesterday, construction of the Keystone XL and Dakota Access pipeline was officially given the go ahead after President Trump singed the official “Presidential permit” which granted TransCanada Corp. (NYSE: TRP) the permission to construct, connect, operate and maintain the pipeline facilities at the international border between the United States and Canada near Morgan, Montana.
What this approval does is not only jumpstart President Trump’s entire infrastructure platform; it also proves to investors that the Trump administration can make good on some of its infrastructure promises.
Fact is, even if only two-thirds or so of President Trump’s proposed $1 trillion “Rebuilding America” initiative is enacted, it’s going to send a tidal wave of cash that will flow into infrastructure projects.
That’s going to pump up engineering companies, construction firms, concrete and steel ventures and even heavy-equipment firms – only nurturing that infrastructure narrative.
All of which is an immediate affirmation of our recent trade in United Rentals Inc. (NYSE: URI).
All of this goes to show the value of going with the flow of the markets – the millionaire lesson I learned all those years ago in Blue Hole.
By listening to what the market is telling us – and ignoring the pundits or what the so-called “conventional wisdom” is saying – we’re able to tap into profits that can be downright staggering.
And that’s the kind of millionaire making strategy we need to make our financial dreams a reality.
D.R. Barton, Jr.
[Editor’s Note: We’ve received dozens of questions about trading options over the past few weeks. That’s why, later this week, D.R. is going to walk you through everything you need to know about options trading as a 10-Minute Millionaire step-by-step. So stay tuned.]