Sunday, January 3, 2010
The Great Delusion
Delusions, it has been noted, begin early and spread widely. And now they're being spread again. Trifling, beggarly, scant, meager, miserely, piddling...take your pick...choose your adjective...just make sure it is synonymous with plebeian, because that is what the biggest loudmouth intellectuals on the market are telling us will be the returns for stock investors for 2010.
The same intellectuals that touted the Depression last year.
Google "depression" and now you'll get a prescription!
And along with the Depression came the tribulations of Armageddon! What happened to that? Now there's not even a peep or a reference to their folly!
So now, this year we have the Great Delusion. The delusion of the bears. And once again, they're following the script of the 666 market. They're trotting out the Great Delusion before its time!
And for those not versed in biblical eschatology, the Great Delusion (Daniel 9:27, 11:31 Matthew 24) is the Abomination of Desolation. In 167 BC Antiochus Epiphanies set up an altar to Zeus over the altar of burnt offerings in the Temple at Jerusalem, and sacrificed a pig over it. (the drawing above is Zeus at Olympia 250 years before that) In the End Times, the Anti-Christ, known as the Man of Lawlessness makes a 7 year pact with Israel, and then halfway through, he tries to establish himself as God. The end of that Great Tribulation was what Wall Street told us we would get last year--Armageddon!
John Etzler had his "perpetual energy" machine--his own great delusion. The bears took it and turned it perpetually bearish!
And once again, their timing is off! Bull markets average over 42 months. We're only in month ten! Can't they even choose an analogy, that has a trifling, or a piddling, or a scant,or at least a miserly similarity to what they are touting?
I guess they just want to live in their own Great Delusion!
Last May, we saw the headlines bandied about that the US was in a risk of a double-dip recession. That's what you tout when you miss the Great Depression. The double dip! But then, I said this:
This economy, and this stock market, will reward the most outlandish bull, and the most bullish economic forecasts. It's not a market, or an economy for the timid....Today, this strategy will be known as reckless. Next year, it will be deemed prescient.
Recklessness left and prescient walked in the door! Now that's the Reader's Digest version, but if you wanted the Christmas version, it's here. I put it out on Christmas Day, because it was another market gift.
Same with this piece titled He is Risen on Easter. See if that was right, while everyone quoted on it was wrong! You get gifts on Holidays!
Wait--didn't we have the milking stool, on this blog, on the day of the second leg up in this market? Touting the next leg up?
And unlike Jane Wenham, no-one had to recite the Lord's Prayer to know if they were guilty of willful ignorance!
So excuse the Sybiliian rant, but in honor of her 16 personalities, I'll cover her head--but then, wouldn't that be a "Shockingly bad hat?" (Excuse the reference to Extraordinary Popular Delusions and the Madness of Crowds) but if you read that book, (that's just one of the popular follies of the great cities) which really is Wall Street's treatise on the history of mass psychology, even though it was penned in 1841, (for perspective's sake just two years before Dicken's A Christmas Carol), but the endorsement by financier, and confidant of Presidents, Bernard Baruch in 1932 put it on Wall Street's bookshelves.
Heck, you can read the book on Baruch Bench in Lafayette Park across from the White House!
But financier Baruch made money because he had faith in his beliefs. Google it. Here's that story:
"Baruch's faith helped him make his fortune. During his Wall Street days, Baruch sold short, to the limit of his resources, a stock he believed to be overvalued. He expected a quick profit on the next business day, believing the directors would not declare the regular dividend since the company could not afford it. He knew, however, that if the directors bluffed and declared a dividend, the stock could rise, and he would have to cover instantly or lose everything. The day before the dividend declaration day, his mother reminded him that the next day was the Jewish holiday Yom Kippur, and he had promised to maintain the solemnity of the annual occasion and "keep" the holiday holy. Keeping his promise, Baruch ignored the multiple phone calls and telegrams from his friends who urged him to take his profit and cover. After Yom Kippur had passed, he read the telegrams and learned that, indeed, the dividend had passed. Rather than rising as a result, however, the stock had fallen precipitously.
Keeping his promise, he had become a millionaire."
And that's as close as Wall Street is going to get to the roasted pig and their Great Delusion!
It's the same with stock market. You have to know your players! Being right on your thesis but being wrong on the stock price, means your thesis meant nothing. You can complain all you want about Government intervention in the marketplace, but they're playing at the table with you, so you have to adapt your rules to them----You have to look at your hand through Wall Street's prism.
And then when markets bluff; you just have to call Wall Street when it does.
And learn from Bernard Baruch!
Because this year's Abomination of Desolation is just last year's Armageddon.
Just another Great Delusion, cooked up by the bears!
Posted by Palmoni at 9:11 AM