Posted on 03/09/2003 1:33:33 AM PST by Pro-Bush
US stocks rose as a report that two sons of Osama bin Laden had been captured triggered a rebound from initial losses.
Share prices fell after the economy unexpectedly lost jobs last month and Intel Corp said first-quarter sales wouldn't meet its highest forecast. They moved higher even though the White House said it couldn't confirm the Associated Press report on the al-Qaeda leader's sons.
"Everything is hinged on anything related to terrorism, bin laden, or Iraq," said Michael O'Hare, head of listed trading at Lehman Brothers Inc, the world's fourth-biggest securities firm. "Any positive piece of news and the market's going to fly."
A fool and his money are soon....
Tell me, how does an abstract concept - a market - know something? The only one's who know something are sentient beings, and it is the nature of markets that those sentient beings are human.
When the NASDAQ was flying high on stocks on companies that had not sales and no prospects of sales was the market telling the truth? Or a few months later when it had dropped to a fraction of its original level on those same stocks was it telling the truth?
Or was it just that the market was telling the truth in both cases - that there were a bunch of self-deluded fools out there who were lying to themselves?
Markets fluctuate randomly because of the random flows of money in and out. Most of the reasons put about by market pundits on why the market moves any amount on any particular day are complete and utter BS. A lot of the BS is generated by traders (I mean the big guys who man the desks at the brokerage firms) who would love a stock to move 1/2 a point in their direction so that they can packet their walking around money and call it a day. The BS is then promulgated by the buziness babes on the tele who were cheerleading the made rush over the cliff.
Markets also move, on a longer time-scale because of commonly shared perceptions that become structural in the market - you know, such as the best place to put your money is in a dot.bomb that will never make any money. Soros thesis is that the best way to make money is to identify those structural trends, try to figure out when underlying conditions and crises will cause them to change and bet the other way. You may not like him, but he has become one of the world's wealthiest men off of this point of view.
A lot of it is also because traders have enormous egos. They like to see their names in print, and their faces on CNBC. If Maria Bartiromo calls and asks why the market was up today, and you're honest and say, "How the f--- should I know", she won't be calling you again any time soon.
Market punditry in general is a game played with zero accountability (lucky for the pundits). They know that their livelihood depends on the false idea that the pros know something that the general public doesn't. (Not that a lot of money isn't made with inside information, but the last thing they're going to do is share it with you.)
Your insights are as succinct and incisive as ever. You are truly the master of the un-spin. Thank you! ;-)
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