[Joe Ross]

Buy the rumor means when you first hear of something you buy, when the actual news hits, sell. Let me give you an example.

You are watching the silver market. You hear a rumor that the silver miners may go on strike. You buy silver, the price shoots up on the rumor. Then the news comes out as to whether or not the workers actually strike. It doesn't much matter if they do or don't. The fact is that prices already rose on the rumor because of fear that the workers might go on strike. When the news comes out you sell, and take your profits. If the news is that the workers did strike you can hold part of your position for further gains. If the news is that they did not strike, you sell all of your position and pocket your profits.