The post below comes courtesy of my friend Blain Reinkensmeyer who runs the very popular Stock Trading To Go blog.

To be a great trader you must be disciplined. Following a set of rules can make the difference between successful story telling versus ruminating on last week’s losses.

Jesse Livermore, one of the best traders of all time, and John Paulson, one of the best traders of the last few years, both have a set of rules they follow religiously. Their success serves as your opportunity to enhance your investment savviness.

Below are the rules of both Livermore and Paulson alongside a bit more background information on who they are (hat tip Minyanville and WSJ).

Jesse Livermore, one of the greatest

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This post provides links to a number of interesting articles I have read over the past few days that you may also enjoy.

• Ambrose Evans-Pritchard (Telegraph): Is $6,300 fair value for gold? November 19, 2009. The last parabolic spike in gold took off when central banks joined the fray in the 1970s, hoarding bullion with the same enthusiasm as gold bugs. Dylan Grice from Société Générale says it smells much the same today. He sees an eerie similarity between the decision of India’s central bank to buy half the IMF’s entire sale of gold, and the move by France’s central bank to start converting dollars into gold in 1965.

• Gregory Zuckerman (The Wall Street Journal): John Paulson making big new bet on gold, November 19, 2009. John Paulson, who scored about $20 billion of profits between 2007 and early

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U.S. stocks closed modestly lower Wednesday, after paring deeper losses, as weak housing data and grim outlook from tech companies fuelled worries about the economy.  Stocks struggled to stay near the 13-month high reached the prior session as jittery investors decided to book profits.  Gold prices rose for the fourth straight session.

The Dow, which had slid as much as 77 points in the morning trading, closed down 11.11 points, or 0.1%, to 10,426.31.  The broader S&P 500 index slipped 0.52, or 0.1%, to 1,109.80, while the Nasdaq, hurt by the weakness in tech shares, fell 10.64, or 0.5%, to 2,193.14.  Bond prices fell, pushing yields higher. The yield on the benchmark 10-year Treasury note rose to 3.37% from 3.33% late Tuesday.  Crude prices advanced 44 cents to settle at $79.58 per barrel.  Volume remained light, with only 1.063 billion shares trading on the NYSE, and declining issues ahead

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This post provides links to a number of interesting articles I have read over the past few days that you may also enjoy.

• Daniel Gross (Newsweek): The greatest trade ever, November 10, 2009. How hedge fund manager John Paulson bet against the real estate bubble and made $15 billion in a single year.

• abc News: SocGen’s top analyst sees market lows next year, November 9, 2009. Albert Edwards, a top analyst with French bank Societe Generale, expects global markets to hit a new low in 2010, adding that he would not be surprised if the global economy enters another recession next year. Edwards, one of the leading equities bears and a long-term critic of the policies of Western central banks, is skeptical of popular opinion that extreme policy response will safeguard the West against a repeat of Japan’s lost decade of the 1990’s.

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I argued the bull case for gold in my posts over the past few months (see “Gold bullion - regaining its shine?“, “Gold bullion glitters bright” and “Gold bullion - challenging $1,000“. With the gold price scaling fresh peaks and closing in on $1,100, it would certainly seem as if renewed interest in the yellow metal is being stirred up, especially subsequent to the purchase by India’s central bank of 200 metric tons of gold from the International Monetary Fund.

As printing presses are running at full speed to produce ever-increasing quantities of fiat money as governments engineer the greatest asset price reflation in human history - and the US greenback is heading South - the longer-term fundamental case for the yellow metal is arguably positive.

“The gold bug has caught several big hedge fund managers this year including John Paulson of Paulson & Company, Kyle

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The “Michael Jordan of trading” is now table-poundingly bullish on gold. And the Reserve Bank of India may have just made him look like a prophet... John Paulson (no relation to Hank) is widely...div class="feedflare" a href="http://feeds.taipanpublishinggroup.com/~ff/taipan?a=dMcbimDGhHo:FGQV1WAidn4:yIl2AUoC8zA"img src="http://feeds.feedburner.com/~ff/taipan?d=yIl2AUoC8zA" border="0"/img/a a href="http://feeds.taipanpublishinggroup.com/~ff/taipan?a=dMcbimDGhHo:FGQV1WAidn4:V_sGLiPBpWU"img src="http://feeds.feedburner.com/~ff/taipan?i=dMcbimDGhHo:FGQV1WAidn4:V_sGLiPBpWU" border="0"/img/a a href="http://feeds.taipanpublishinggroup.com/~ff/taipan?a=dMcbimDGhHo:FGQV1WAidn4:F7zBnMyn0Lo"img src="http://feeds.feedburner.com/~ff/taipan?i=dMcbimDGhHo:FGQV1WAidn4:F7zBnMyn0Lo" border="0"/img/a a href="http://feeds.taipanpublishinggroup.com/~ff/taipan?a=dMcbimDGhHo:FGQV1WAidn4:wd9GD17jvC4"img src="http://feeds.feedburner.com/~ff/taipan?d=wd9GD17jvC4" border="0"/img/a a href="http://feeds.taipanpublishinggroup.com/~ff/taipan?a=dMcbimDGhHo:FGQV1WAidn4:l6gmwiTKsz0"img src="http://feeds.feedburner.com/~ff/taipan?d=l6gmwiTKsz0" border="0"/img/a /divimg src="http://feeds.feedburner.com/~r/taipan/~4/dMcbimDGhHo" height="1" width="1"/

Some of Wall Street’s most prominent bears are turning bullish right now. But that doesn’t mean that your small-cap portfolio is safe. Here’s why these brilliant minds think that we’re back on the path to recovery — and why they’re wrong.

I was in Manhattan last week attending Grant’s Fall Investment Conference. The U.N. General Assembly is meeting there, and the streets were blocked off in places. The NYPD was out in full force. I heard one passerby complain about the inconvenience of it all to one police officer. He responded, “Don’t blame the NYPD, blame the General Assembly.”

With the General Assembly in Manhattan and the G-20 in Pittsburgh, government has taken over the headlines this week. It seems half the world is mostly preoccupied with telling the other half what to do. No doubt, bossiness is in a bull market.

At Grant’s conference, I heard presentations on gold, the dollar, oil,

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U.S. stocks recovered from early losses to end the day slightly higher, helped by a rebound in energy, financial and technology shares.  Volume was extremely light as investors, lacking in enthusiasm, refrained from taking big positions. 

The Dow Jones industrial average, which at one point had given up as much as 84 points, rose 37.11 points, or 0.4%, to close at 9,580.63, its eighth consecutive advance.  The broad Standard & Poor's 500-stock index rose 2.86 points, or 0.28%, to 1,030.98.  The tech-heavy NASDAQ composite index edged up 3.30 points, or 0.16%, to 2,027.73, helped by a late-session rally in technology shares.  Treasuries fell, pushing the yield on 10-year notes up 0.3 point to 3.46%.  On the New York Stock Exchange 1.16 billion shares exchanged hands and advancing shares were ahead of those that declined eight to seven.

This morning’s stock futures suggest moderate gains on the opening.  Dow Jones

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Several key second-quarter earnings reports could either validate or undercut assertions that the U.S. economy is poised for recovery.

After the Commerce Department reported last week that retail sales fell 0.1% in July from June, and 8.3% year-over-year, retailers will stay in the limelight this week as several high-profile companies report second-quarter earnings. Target Corp. (NYSE: TGT), Limited Brands Inc. (NYSE: LTD), and Gap Stores (NYSE: GPS) are among the big-name retailers set to report.

Meanwhile, the Hewlett-Packard Co’s (NYSE: HPQ) report will provide a further glimpse into the world of technology, and The Home Depot Co.’s (NYSE: HD) results will confirm or counter claims that the recent housing rebound is for real.  On that note, the upcoming economic releases include July housing starts and existing home sales, while the wholesale inflation gauge may show that price pressures are not

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Investors chose to brush aside a report showing a surprise drop in retail sales, sending stocks mildly higher Thursday as retailer Wal-Mart’s better-than-expected earnings and a positive debt auction helped markets hold on to Wednesday’s rally.  Trade was choppy earlier in the session as stocks looked for direction but some bargain hunting towards the end lifted the markets.  Surprising second quarter economic growth from French and German economies also lifted sentiments on the Street.

The Dow Jones industrial average added 37 points, or 0.4%, and closed at its highest point since November 4.  The broad S&P 500 index added 7 points, or 0.7%, and closed at its highest level since October 6.  The tech-heavy Nasdaq gained 10.63 points, or 0.5%, ending at its highest point since October 1.  On the New York Stock Exchange 776 million shares exchanged hands and advancing stocks outpaced those that fell two to one. 

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