It’s been one amazing year, in the markets, and for me personally.  I won’t go into the specifics of the market, ya’ll know what took place, if you don’t, I hope that time you spent in some Taliban safe house in captivity wasn’t too awful.  I hope you all learned a thing or two this year, there’s no substitute for having your money on the line in the market.  If you didn’t learn something about yourself, I highly recommend you do some meditation on that over the weekend.

As I remarked a few days ago, there’s a difference between understanding something academically, and completely internalizing it, even if you have practical experience.  We should all feel lucky to have traded through the market these past two years and come out alive, this has been the best education any trader could have asked for.  Here are the major things I learned this year.

There is a true meaning to “don’t fight the fed”.  Yes, we all recite this over and over again, buy equities when the fed lowers rates, be cautious when they raise em.  We saw the true power of how this works this year as money poured into the market, people were deathly afraid of holding cash, they still are.

The economy is not the market!  Our economy is still sick, people don’t have jobs, we have a huge debt crisis on our hands, consumers aren’t spending money, and businesses aren’t growing their top lines.  None of this matters, it really never has, the market will go where the market wants to go based on flows of capital.  At some point the market and the economy must come back into equilibrium with reality, but I dare you to fight that trend until it goes your way, it’s a losing battle.  Pay attention to what the charts and sentiment are telling you, your hard held economic beliefs will get you run over.

There’s no such thing as an irrational market, just you being irrational in the face of the market moving against you.  Luckily I didn’t have to learn this lesson first hand, I’m sorry for those that did, but I’m glad I was able to witness it from a distance.

We’ve pretty much been through the technical analysis handbook over the past two years, I’ve been given the lesson of a lifetime.

The Reformed Broker asked myself and many others to comment on what we learned this year, it’s a great piece, funny as hell. (The Reformed Broker)

I want to thank all of you for coming here and experiencing the markets with me.  At the end of the day, I get so much more out of sharing than you will ever get out of listening.  I hope I’ve both thrown you a few fish, and taught you how to catch your own.  I always enjoy the feedback and banter.  I believe in transparency above all else, which is why I post my trading book for all to see.

None of this would be possible without StockTwits.  I owe a lot to the community and my colleagues at StockTwits, we are building something very special, and I’m thankful for the fact that I have the opportunity to help build this venture.  Thank you guys, you know who you are.

And lastly, I want to thank Brian Shannon (@alphatrends).  Brian is what brought me to StockTwits, and Twitter in the first place.  Before Brian ever had a real blog, he was posting his market reviews and trading ideas for all to see on YouTube, for free.  No matter how much experience you have as a trader, you can always learn something from Brian, along with the fact that he throws some very fresh fish out there.  On top of all that, he’s generally a class act.

I hope you all have an excellent new year’s celebration, I’m out at the beach next to the fireplace.