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http://www.thestandard.com/articles/display/0,1449,4791,00.html
June 04, 1999
The Only Game in Town
By Carl Steadman
I'm eating last week's sandwich, drinking yesterday's coffee, wearing
clothes that haven't been washed or changed for longer than I care to admit.
Hunched over a keyboard, I tug at my hair, one pull for each second I squint
at the Level II trading screen. Dandruff leaves a powdery white coating over
everything. I dust off my sandwich and take another bite.
I'm day trading, buying and selling stocks to profit from small incremental
swings in the market. A few fractions of a penny here, a few fractions of a
penny there, multiplied by thousands of shares over hundreds of trades, and
it begins to add up. Into fantastic losses.
Day trading represents the Internet Economy's relentless pursuit of
efficiency. With the single click of a mouse, I'm able to lose $5,000 or
$10,000 or more, easily. It would take me 10 to 20 clicks to do that buying
Beanie Babies on eBay.
I glance up at the publicity photo of CNBC reporter Maria Bartiromo and say
a little prayer, shorting Lycos 10,000 shares. When I look back down at the
screen, LCOS has turned from red to green. I'm on the wrong side of the
market.
The stock climbs. Dreams of a shiny new Audi TT vanish as I cover my
position, buying the stock at $97 to replace the 10,000 shares I borrowed at
$96, costing me a point a share. I've lost $10,000, plus fees.
It's over. A few seconds later, the closing bell sounds.
"I thought it'd be like that Discover Brokerage commercial." I'm meeting
Joey for after-market drinks. Joey's another writer-turned-trader. All
writers, it turns out, are natural-born day traders. Members of both
professions spend their days in front of a computer in their underwear,
swapping tasteless jokes about plane crashes and high-school massacres.
"The one with the helicopter or the island?"
I hate those ads. "I should be getting better at this game. I'm not."
"You're obviously buying when you should be selling. And selling when you
should be buying."
"Thank you, Joey. Thank you so much." I munch on a stale pretzel. "So how do
you pick your stocks? Channeling? Shadowing? Trading the grade?" These are
all terms I've picked up from an Amazon.com best-seller. I'm not really
clear on what any of them means, but my years of training as a reporter and
journalist tell me that throwing the jargon around liberally is usually good
enough.
"My only metric is stupidity."
"So you admit it. And you still make fat wallet?" Everyone's getting rich in
this market except me.
He scowls. "No. Other people's stupidity. The greater fools."
Joey may be referring to me. I shrug. "I've been trying to get in before it
breaks out and get out before it breaks down." I echo advice I've gleaned
from an Internet chat room. "But I've just been getting broke."
"You don't have the trader mentality," he says, popping a piece of Nicorette
gum in his mouth.
"Trading is not investing. Avoid the paralysis of analysis. The trend is
your friend." He chews. "To get stupid rich, you gotta think stupid."
Easy for him. He goes on: "Starbucks says it'll unveil an Internet strategy
next month. Starbucks.com!" Joey flaps his arms about wildly. "The details
may be sketchy, but we're talking dot-com here! That's worth $420 million,
easy!"
There's no stopping him. "Computer Literacy changes its name to Fatbrain.
Fatbrain! What's that worth? A million?" His face stretches into an
exuberant grin. "It's not a Web site anymore, it's a brand! $10 million?
Maybe if they would have called it Thickheaded. But it's Fatbrain! $100
million! Buy early and often!"
"So I should trade off speculation and gossip?" It sounds like reasonable
advice. "To move ahead of the pack, you have to follow the crowd." He shakes
his head ruefully. "The tragedy is that I have to watch Fatbrain's CEO on
the morning broadcasts droning on about 'the cool factor' and know that in
order for me to bring home a few thousand, he's got to rake in millions."
I feel his pain.
Joey's Tag Heuer chronograph begins to chirp. "Gotta go," he says. "Tokyo
opens in an hour. Now remember: You can't keep betting against CNET just
because Halsey doesn't invite you to his parties." He's gone, probably to a
party I don't know about.
The next morning, the market opens strong. I'm going long. I take coins out
of my bucket and drop them into the ventilation slots of my monitor, one
after another. Today's my lucky day. Things are going to change. I can feel
it.
Please send tips to carl@xxxxxxxxxxxxxx
JW
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