Stock Forex

This made it clear to me that the bottom line to wealth is duplication and repetition. A hamburger in Tampa Bay must taste just like a hamburger in San Francisco Bay, and McDonalds took advantage of this, not by selling one gigantic hamburger, but by selling billions of little ones—and french fries. Repetition made the McDonalds fortune.

About nine months after I started driving, Mrs. Potter called us all in for a meeting between shifts. While we were waiting for her to come in, all the cab drivers were bragging about how much money they were making. Bill Marsh sat there and said he had made more money in one month than anybody there. I casually asked him how much he made. With a note of triumph, he said, “One month I made $900.” All the cab drivers started oohing over him, thinking that $900 was a lot of money.

Now remember, my lowest month was over $3,200. But I said with a smile, “Boy, that is a lot of money, Bill.” No way was I going to mention to these guys how much I was making. They could see the rental properties I was buying and draw their own conclusions, but to this day, they still don’t know.

On to real estate. At first, I did not follow the lesson I learned as a cab driver. I went out and started the old buy-and-wait game. I waited for inflation, waited for Washington D.C. tax write offs, and waited for other things I had no control over. After a year of playing the buy-and-wait game— the rental game—I had to sell one of my properties. I desper­ately needed money. I sold the property, received some cash for the down payment and carried back a mortgage. The key, however, is that I didn’t get all cash up front. I sold the property under what you would call “owner financing.”

I sat in my taxi, staring at the check I received from the down payment, and realized something: I had purchased this little property with $1,200 down; when I sold it, even after closing costs, I still ended up with $2,200—$1,000 more than I put into this property in the beginning. And, I would receive net monthly payments of $125 for 28 years.

I just stared at the check. I had stumbled across a whole new way of investing. I thought, why am I playing this buy-and-wait game? Why am I turning my life over to renters? Why wait for tax write offs out of Washington D.C., hoping some benevolent congressman gets a depreciation bill passed through Congress? Why am I doing things I have no control over? Why don’t I just go out and buy properties to sell? Why not do the meter drop with my properties?

I figured that I could sell a couple more rentals right away and then target properties I could buy and fix up a little bit, then turn around and sell on this “money machine.”

Back then, I did not call it the “Money Machine.” I called this “turning properties” or “flipping properties.” Neverthe­less, I realized that I had to treat real estate like the “meter drop.” Instead of getting in and waiting, why not just buy for the sole purpose of reselling? This way I could build up a huge base of deeds of trust and mortgages and have monthly checks coming in. In the end it was these monthly checks that allowed me, and will allow you, to live the way we want.

At that time I had a lot of rental properties, but they were only making a little bit of money. If one renter didn’t pay one month, it ruined the profits for the whole month. I was constantly putting more money into taking care of these properties. Any of you who have had rental properties real­ize that no matter what kind of money you have lying around in the bank, any rental property will “eat it up” and take it away from you. The giant “sucking sound” is real.

The rental game is just not what it is cracked up to be. However, the “Money Machine” is a fabulous way to make money by literally forcing the issue—rapidly accumulating wealth. I did this over the next year. I went out specifically looking for properties I could buy and sell quickly. Again, it was the meter drop. Get the passenger in, get the passenger out, and get on to the next deal. After doing many of these properties, I was able to quit and retire at the age of twenty-nine.

When I was young, my goals were not lofty. I didn’t want to be President of the United States or conquer the world. My dream was to become a college professor. To educate myself to reach my dream, I needed income. I could not get any money from my parents, and because we were a middle class family, it was hard to get college grants and loans.

To generate income, I started up an insurance agency. I figured that if I wrote enough policies, I could have continual income from premiums—at least enough to support me through .college. But as hard as I worked to get policies on the books, it was still hard to get paid. I was successful, but it just wasn’t enough.

So I made two moves that changed my life permanently. First, inspired by the book How I Took a Thousand Dollars and Made Five Million Investing in Real Estate by William Nickerson, I turned to real estate. I borrowed money to buy my first couple of properties.

Second, simply out of the need to buy groceries for my family, I latched onto a job driving a taxicab. Have you ever had one of those experiences that afterwards continues to change just about everything else you do? Driving a taxi was just such an experience for me.

In order for you to understand what this is all about, you need to come back with me to my first day driving a cab. The company I started driving for, Yellow Cab Company in Tacoma, Washington, had a mandatory rule that entailed spending a day training with a cab driver-trainer named Bill Marsh.

After being out with Bill for about 45 minutes—30 minutes at Denny’s getting him a cup of coffee—I realized that I could handle this cab driving business on my own. As I watched what he did, it dawned on me that to be a successful cab driver you only had to do one thing.

I asked Bill if he would take me back to the lobby to get my own taxi. He said I had to spend the whole “mandatory” day with him. “Look,” I said, “could you please just take me back?”

Back at the cab company I talked to the owner/partner. “Mrs. Potter?” I said, “My name is Wade Cook. I’m a brand new cab driver. You don’t know me, but is there any way I can just take a taxi out for the day?”

She replied, “Oh no, no. You have to spend the day with Bill Marsh.”

I persisted. I explained to her that I knew Tacoma really well and told her that if she didn’t like what I did by five or six o’clock that afternoon, she would never see me again. She listened and ended up giving me a little beat-up Dodge Dart for the day.

I took it out that first day and made $110—that was my net. The second day I came back with about $90 profits and the third day about $140.1 was off and running. I began making between $3,200 and $3,800 a month. I needed about $1,200 a month to live on. I was able to take the rest, holding some out for taxes, and apply it to buying and fixing up houses. With this money, I purchased nine rental houses my first year.

My point here is the lesson I learned in driving a taxi—to me the most significant and powerful financial lesson I have ever learned in my life. In fact, since then I’ve hobnobbed with some of the greatest financial minds in the country (doing radio, TV talk shows and seminars in 43 different states), and nothing I’ve learned from any of those men and women is more powerful than what I learned my first day driving a cab. The lesson is simply this—MONEY IS MADE IN THE METER DROP.

What does “the meter drop” mean? Every time you get into a taxi, the driver pushes the meter down (nowadays it’s a computerized button), and it costs you $1.50 to $2. Whether it is a $5 run or a $50 run, you still pay $1.50 every time you get in the cab.

Many cab drivers only take big runs. In Tacoma they positioned themselves in town to get the run to Sea-Tac Airport, a $30 to $35 fare. At the same time, I was beating the cab to death by going for all the small runs. I would take the $3, $6 and $8 runs. At the end of some busy days I would have up to forty, fifty or sixty runs. You see the difference? I was killing them. Now, don’t get me wrong, I’ve had my share of big runs too. Sometimes a little $6 run would turn into a $15 run because the person my passenger was going to visit wasn’t home. However, those extra meter drops really added up to a lot of cash.

Can you get rich working for someone else?

Probably not, unless you make excess income and then get that extra income producing great returns.

Can you get rich owning your own business?

Yes, but most businesses fail. Even if the business does not fail, most take up too much of the owner’s (manager’s) time working on things which do not make him or her rich.

Is the American Dream still alive and well?

It truly is.

One secret of wealth accumulation has been that little extra something put aside and left to compound. Is the time right for you to “get rich?” After all, someone becomes a millionaire every 37 minutes. When is it going to be your turn? What superior knowledge do you have? What risks are you willing to take? What time can you donate to making a great financial life? This chapter is about getting rich—filthy rich if you want, with more income than you can possibly spend. I have thought long and hard about what I could write, what I could do to help you become a “cash flow millionaire.” I want you to read every word of this. Do not skip anything. I will build a case for you and show you in many ways that you can build up $12,000 to $35,000 per month cash flow—and do it in the next year. I will show you how to do it without vitamin pills, or any other multilevel concern. I will show you how to do it by first eliminating the risk—or at least making risk so negligible as to make it a non-item.

You will use Bear market strategies in the midst of a Bull market, and you can get started with $500 if that is all you have. It is doable. I have made tens of thousands of dollars a day—if you attend a stock market training session we will show you how you can build up this level of income. And you do not have to go through nine years of costly trial and error like I did. You will not have to be at the mercy of unscrupu­lous and unintelligent stockbrokers, as I have been. You can cut to the chase, start making huge returns in days and keep all your profits.

You might be asking yourself, “How can Wade possibly be talking about the stock market? Especially when funds man­agers claim bragging rights with 12% returns?” Can invest­ing really produce 18 to 42% monthly returns—month in and month out? And what kind of returns are these? I will answer all of those questions, but for now allow me to start with the last question. The kind of returns I am speaking of are actual cash—either hitting your account or mailed to your home or business. It is not growth, not tax savings, but money you can use.

For awhile—at least in the beginning—I suggest you use it for portfolio enhancement, either building more cash flow by doing more of what you did before, or buying some “hold” investments; or applying it to other formulas. Later, with a small amount of money, delve into riskier but incredibly profitable strategies to really make a big “bang” on your bottom line. Regardless of your choice, your return is in cash, not some poor substitute. I have always contended that WE, you and I and all my other students, can make more together than we ever can alone. It is true. I will lead the way. I will try and test new ideas, formulas, strategies, processes—you come along, buy my book, attend my ongoing classes, and then make millions, spending your profits the way you like.

Each person who attends my seminars does so for his own personal reasons. Some are just getting started and need to learn the basics, others are in business or want to be, and need help “growing” their business. Others are making good money but paying a high price in terms of stress, time away from their families, et cetera. Others have tax problems and a host of others are in various stages and want to learn how to keep and protect what they have as well as pass on what they have “scraped” together throughout their lives. And while they come for various reasons, they all have one thing in com­mon—they know there is a better way. A more excellent way, if you will. What is the saying, “Winners just find a better way to get there?”

Now that I have asked all these questions, who is this person asking these questions? Let me introduce myself briefly. I realize you may not know anything about me or my back­ground, or to what extent it will help you make more money. So I will be brief, but you need to walk in my shoes for a moment. I cannot help you in the present unless you know what got me here, what drives me, what my fears and passions are.

Now, let’s move on. Take $100,000 or even $200,000 and buy more blue chips. Take the other $50,000 (or more) and keep it generating cash flow. You see, that’s the point I’ve been making at my seminars and in my writings. Use the formulas for income generation to build up your cash flow, so you can accelerate the purchase of stocks in great companies.

Here is a list of my cash flow strategies:

1.    Rolling stocks

2.    Slams—buying stock on dips

3.    Bottom Fishing

4.    Peaks (short sells or buy puts)

5.    Rolling Options

6.    Writing Covered Calls

7.    Selling Naked Puts

8.    Dividends (I have many Special Reports and taped seminars explaining these)

9.    Stock Splits

10.  Turnarounds and Spin-offs . ..

They are to be used for cash flow. They put the emphasis on selling—getting out. You only purchase them to resell them at a profit. They deal with two-week and one-month 15 to 55% returns. They spin off cash. Real money. “Send it to my house and let’s go shopping” type of money!

If you choose, you can use some or all of this cash flow to build a wonderful, safe, “proud to own” retirement portfolio. But one which accumulates quickly because you’re able to add to it repeatedly, month after month, with the profits from the smaller cash flow part of your system. Look at the following:

Look at the diagram on the following page. Study it. You’ll see at first, and in most cases continually, a strategy to keep up the income but move profits into safer investments.

Using Options To Build A Portfolio

So to answer this light and superfluous charge, I dedicate this chapter to building a strong portfolio for the long term. I won’t turn on my cash flow formulas. In fact, I’ll use them to build a portfolio to be proud of—an “investment club” style portfolio, but I’ll do so my way; defining the methods and even the terms, such as “long term.”

I am no different than most prudent investors or pension and mutual fund managers. I want to look at my portfolio and see huge, brand-name stocks like AT&T, Boeing, Wrigleys, McDonalds, Nordstrom, Sears, General Electric, Pfizer, Marri­ott, et cetera. I want to own stock in companies I can eat in, shop at, dial up, and sleep in! I like quality. I repeat, I like great companies with excellent growth, trademarks, earnings, mar­ket niche, and sheer strength of size. I want millions of dollars of them and I don’t want to have to work a 9 to 5 job to get them. Boy, that’s a conundrum. It’s almost impossible to work a typical American job, with average income and accumulate millions. Yes, in 40 to 50 years maybe, but who wants to wait that long? That’s the rub—accomplishing the task of having millions, without having to work for millions. So, it is not my goal or objective which differs from the “conventional wis­dom” reeking from virtually every financial planner/stock­broker—the so-called experts—but themethod of getting there. This is where we part ways.

You see, my method is simple. I want to use a small amount of money—risk capital if you will, to generate cash flow which will exponentially generate more income. I’ve never advo­cated that a person put his portfolio at risk with aggressive plays. In fact I’ve repeatedly and strongly advised against it.

To prove this point, and so there is no misunderstanding, I’ll repeat it here. Use a small amount of money—say $2,000 to $10,000—to build a cash flow machine. Keep the balance of your money in high grade stocks, bonds, mutual funds, and even in real estate and other businesses outside the traditional stock market investments. The stock market is simply too risky for me.

Will Rogers said it best: “I’m worried about the return of my money, not just the return on it.”

Let’s deal with the $2,000 to $10,000 figures. That may seem high to participants of the “meet the 2nd Tuesday of each month, invest $50 a month and sit around for hours discussing one or two stocks, and hope for the best” clubs so prevalent today. Let’s break everyone into categories: Those with under $100,000 to invest, and those with over $100,000 to invest. Everyone reading this falls into one of these two categories. That’s simple, but the next part is not so simple. If you only have $2,000 or so to get started, then I’ll make an assumption— your family is young. If you’re older, (say older than 40) and you can barely scrape together $2,000, then you probably need a different book than this one—perhaps a motivational book, or one on vitamin pills. Whatever, young or old, if that’s it, then find the most outrageous, crazy, wild, risky plan you can find and go for the gusto. What do you have to lose? Surely you can get back (earn, et cetera) $2,000 to $5,000. In Arizona, they teach you that if you have water (bottle, canteen, et cetera) and you get stranded in the desert — drink it all—now! Apparently our bodies store and ration liquids better than our minds.

If you have $100,000, then take $95,000 and buy safe, secure, blue chip, “hold for the long term” stocks. Be extra safe. Now take $2,000 to $5,000 and go to town. Treat the stock market like a business. Be aggressive.

Read the following letter and see what I mean. The last time I talked to this man, his $20,000 was over $267,000 and that’s three to four months after attending my Wall Street Workshop.

He’s on target to make over $1,000,000 in one year, from his $20,000.

Dear Mr. Cook,

Enclosed please find a copy of my extended resume and a video copy of my film product reel. No, I’m not looking for employment, I’ve included it so that you can see that my occupation is not one conducive to “playing the stock market.” I’m a movie maker. I write, direct, and produce features for theatre and television.

Pretty far removed from the market, wouldn’t you say? So, why am I sending it? For one reason.. .I’m now six weeks or so past one of your Houston Wall Street Workshops and the results have been interesting (an understatement)!

As a filmmaker, I move from project to project. I’ve just completed a two-hour television special entitled, America, A Call To Greatness with Charlton Heston, Mickey Rooney, Deborah Winters, and Peter Graves. Next week, I’ll be directing several episodes of a new fall series for ABC. In between, I do nothing. It’s these periods of inactivity that annoy me. It’s not that I have to be constantly active, but it helps. In my industry, these periods are referred to as “being between pic­tures.” Translated, it means unemployed—“waiting.” I’ve been in the industry for some years and I always have work . . . and I always have inactivity. Having heard of your workshop, I thought perhaps it might provide me something to do during these periods. Al­though I’ve been in the market from time to time, one of your sales people convinced me that I didn’t have to know anything about the market to attend . . . and to benefit. Another customer service representative recommended that I come prepared to trade . . . to open a stock account, et cetera, so I did.

You will note from my resume that I spent ten years as a university professor and about the same on the “seminar” and “consulting” circuit. I know from expe­rience that only a few out of a seminar ever really benefit … not because the seminar isn’t good, but because most tend not to apply what they learn. I didn’t want to be one of those, so I took the tapes mailed with your “Financial Power Pack” and listened to them . . . and listened to them . . . and listened to them. Even during the class breaks, I continued to replay them, et cetera. They were helpful in that I had an idea about what would be discussed during class and became familiar with some of the terminology.

I’ve always enjoyed a “good” seminar and this one was. I must admit I was skeptical, mostly because of the perceived “hype” that went with the “selling.” How­ever, the class did deliver on what it promised (a seminar that “works,”what a novel approach).

I opened an account with $5,000. If I made money (which I had reservations about), great. If I lost money then it wouldn’t be “great” but it would occupy some of the time before I began directing again. I must admit, I didn’t expect what followed.

I began trading on the first day and knew immedi­ately that I’d opened an account with the wrong broker when he began to argue with me about my trade. What I didn’t want to do was jump into his company “hot stock of the day.” While I knew nothing about the market, I didn’t just fall off the banana boat either. Fortunately, there was a broker attending the WSWS that understood what the class was doing and was able to produce buy/sell slips demonstrating that he was actually making the trades being discussed in class. I opened an account with him and the choice has turned out to be a very good one. There was no “training” of the broker required. In fact he was (and has been) very supportive of the “Cook-Concepts.” (In fact, he’ll be attending the Wealth Academy with me in June.)

I won’t bore you with the class trading details but by Friday following Thursday’s class end, my $5,000 had grown to nearly $15,900. That got my attention! I added another $15,000 to the account and a little over a month later, my account was nearing $100,000. I added an­other sum of money and similar results have followed since then.

I wanted to learn each of the strategies taught, so I tried a number of them.

For example:

Sample Option Plays:

Bought Coke (KO) Options at $4,625 and sold after a split at $6.50

Bought Iomega (IOMG) Options at $6 and sold at $10.25

Bought Accustaff (ACST) Options at $3.25 and sold at $4,875

Sample Covered Calls:

QuaterDeck (QDEK) bought stock at $14 and sold options twice

Egghead (EGGS) stock at $12 and sold calls at $1.9375

Network Express (NETK) at $12, sold calls at $.875 and called out at $12.50

IMP Inc. (IMPX) stock at $17.50, sold calls at $.9375

Sample Rolling Stock:

Bought ScoreBoard (BSBL) at $4,125 and sold at $5,636 (dropped & bought again)

Network Express (NETK) at $3.23 and sold at $5

. . . and I could go on with some 23 other trades. I lost on five of them. Of the five, three of the losses were my fault, not the system. And listen, Mr. Cook, if you think driving a taxi doesn’t qualify a person to be in the market, try movie directing. This morning I bought 10 contracts of HBOC at $12 and now three hours later I just sold the calls at $13.50. It’s only a 12.5% return, but annualized it’s 4,562.5%. Not too shabby for a few hours work.

As I said earlier, I’d had a successful career in the consulting and seminar field so I always appreciate a good seminar (most are not). And, as much as I like the Wall Street Workshop, I would have paid the fee just for the last day’s entities’ seminar. Aside from my market success, I will save enough in taxes from that one day to pay not only for the Wall Street Workshop, but for every other seminar that you offer, the courses you sell, the books, manuals and chapters, WIN, et cetera. And, you will note from your sales records in my account that I’ve

gotten about every thing you have (paid for by the WSWS course).

Since the course, I’ve read your new “hit” in detail, studied theZero to Zillions home study course, watched and re-watched the WSWS Video Tape Sets, et cetera. Since the first course was so good, I’ve signed up for the June “Wealth Academy” and will be attending the “Next Step Wall Street Workshop/’ et cetera. It’s going to take a lot more than the 5 star entities to handle my business (I already have six), so I’ll also be at the “Executive Retreat.” The best of all this is that I haven’t paid for a dime of it. The earnings have more than covered everything.

I like your style so much that I’ve registered for the June “Real Estate Boot Camp” but this time, I’m bringing my wife. Now talk about someone without a background for real estate . . . my wife, Deborah, is an actress (she had one of the leads in The Winds of War and lead in Kotch with Walter Mathau, the lead in Class of ‘44, and the lead in The Outing, et cetera). But, she, like myself, has interests in things outside our field . . . particularly where they are profitable. To keep it in the family, my son will be attending your youth WSWS in August. It’s a great idea. I would have liked to have had this background when I was his age.

The concept of teaching the youth financial concepts when they are young is terrific. If I can help you in any way, please don’t hesitate to ask.

Mr. Cook, thanks for being in the “business.” The only problem is that now I’m enjoying the market more than the other things that I’m doing … a nice problem!

Best Regards,

Dr. Warren C.

Okay, let’s say he only makes $250,000 on the initial $5,000. Let’s say that’s you. You’re two days of training away from having the skills to do this. If it is you, and you are into safety, remember, you have your $95,000 worth of good, solid invest­ments to make you feel good at night and when you get your portfolio’s statements. Hopefully, the dividends and growth of the stocks will give you 10% plus per year. That could be $10,000 (of which only a small portion is cash). You’ve got the best of both worlds; aggressive cash flow and stability.