First off, I have to say that I quite disagree with the argument that Leonard dating Penny is even more unlikely than Raj not being able to talk to women based on one simple point: I am dating the woman of my dreams. How can we consider that to be an unlikely occurrence that a science obsessed guy could be with a pretty girl? I got the girl so why can’t others?
(Clarifications: In the previous sentence “got” in no way implies a sense of ownership in the way guys in Ed Hardy t-shirts will talk about “my girl” in roughly the same tone of voice as they refer to “my car” or “my Ed Hardy t-shirt.” Also, “girl” is used as a colloquialism here as Kim is an intelligent and sophisticated woman, which in many ways makes the Penny analogy slightly suspect. “The” is rather self-explanatory and “I” refers to me. Hope that helps.)
(Also, just for those wondering, Kim and I are celebrating our eight month anniversary; yes, our first date was on Valentine’s Day. As Kim eloquently put it, this marks my longest relationship by, oh, roughly seven months. And you know what, for eight months I have been completely unable to get the smile off of my face.)
Switching gears so fast that I probably just blew out a transmission I must officially offer my condolences to the wrestling world on the passing of the legendary Captain Lou Albano. Best known for his penchant for rubber bands (around his beard, pierced through his cheek), presence in Cyndi Lauper videos and starring role as Mario on the Super Mario Brothers cartoon show the Captain passed away today at the age of 76. The manager of champions will be well remembered for all of the tag teams that he led to glory; the majority of which were Samoans as for some reason the WWF tag champs in the seventies were always Samoan. The mystery as to who officially anointed him with the title “Captain” has never been answered. I always assumed that it was nautical in nature.
Other news of the day was the Dow breaking 10,000. This was met with cheers by those of us on the Trade Floor. I’m not making that up; you actually heard a round of applause when we saw five digits for the first time in a year. Now as most people know financially speaking the fact that the Dow broke 10K is meaningless but from a psychological perspective it is very important. Given that at time psychology is more important than economics in understanding the stock market it is something to pay attention to. Basically, it is a sign that the market believes that it has some strength and that there is hope for the future.
The problem is I really have an issue with it. This just does not feel like a 10,000 Dow market to me. We have no job growth and while they say tech and banking is leading the way back I’m just not entirely sold on the fact that the growth is really there. With a jobless recovery I’d feel more confident in the 9,000 range. What I really think is happening is that the dollar is so weak (1.49 to the Euro) that the markets are higher due to the devalued currency. That worries me even more. Still, I was on the record for saying that we wouldn’t see 10,000 until next year at the earliest so take it as a good sign. I hope.
Showing posts with label Economy. Show all posts
Showing posts with label Economy. Show all posts
Wednesday, October 14, 2009
Monday, February 09, 2009
Since when is the President more important than The Bachelor?
I am very upset that tonight's episode of How I Met Your Mother was cancelled in order for us to watch the president speak. Plus, I had to wait an hour and a half to watch The Big Bang Theory. What type of country is this? Did I suddenly move to Russia?
(However, getting to see Leonard screw up with Penny by being unable to stop analyzing the moment was something that was well worth waiting to see.)
(Oh, and wish that the reporters at the president's news conference covered all branches of the media spectrum. I want to hear Daphne LeBeau from People magazine ask "Mr. President, do you feel that Bikini Girl was unfairly booted from American Idol last week" or Joyce Deloit from Cat Fancy say "Mr. President, isn't your decision to only get a dog for your girls completely specieist?")
I guess since I am rather light on topics at the moment I will talk about the economy. One interesting thing to note is that in reality the stock market has been pretty much unchanged for the past few months. It has been languishing in the 8000s with a few tests of the 7700 floor (which I predicted back in Spetember). So despite the fact that everyone feels that the economy is getting worse the stock market has at least stabilized. I'm still really worried about what happens if we break through 7700 ( my guess is the next floor would be either 7200 or 6500) but it has been a good sign that we've been able to stay above it.
What is really impacting the economy now, and what makes this different than most of the recent recessions, is that this is really a two stage recession and we are only now hitting the second stage. All of the financial meltdowns of 2008 were really financial in nature. Banks having issues with mortgage backed securities is not something that directly effects regular people. The shock in the credit market and the failures of banks caused the huge drop in the stock market but did not initially impact most people directly. True, everyone became poorer on paper with les in their 401ks and a lower house value but their day to day paycheck was not effected. That is, until phase two began.
Which is where we are now. The companies that actually provide services are now facing with the credit crunch and know that they have to curtail their spending. This means massive layoffs, which started appearing in late 2008 but have been increasing in 2009. Now is when the recession hits the population. This is when people are unemployed and figuring out how to make ends meet. It doesn't get shown in the stock market as much (because the market is always a leading indicator) but it certainly gets shown in the American psyche.
What is next for the economy? I don't think we've seen the bottom yet but I don't feel as though we are too far removed from it. At least from a stock market perspective my fear of a 5000 Dow seems to be a lot less likely. What I expect more than anything is a very slow rebound. The only recent similarity that I can point to is the early 80's. This feels a lot like that recession (in that it is just brutal and no one can really explain why) and it took years to get back into a clearer view of the economy. So expect a few brutal months and then a little light showing at the end of the tunnel.
(However, getting to see Leonard screw up with Penny by being unable to stop analyzing the moment was something that was well worth waiting to see.)
(Oh, and wish that the reporters at the president's news conference covered all branches of the media spectrum. I want to hear Daphne LeBeau from People magazine ask "Mr. President, do you feel that Bikini Girl was unfairly booted from American Idol last week" or Joyce Deloit from Cat Fancy say "Mr. President, isn't your decision to only get a dog for your girls completely specieist?")
I guess since I am rather light on topics at the moment I will talk about the economy. One interesting thing to note is that in reality the stock market has been pretty much unchanged for the past few months. It has been languishing in the 8000s with a few tests of the 7700 floor (which I predicted back in Spetember). So despite the fact that everyone feels that the economy is getting worse the stock market has at least stabilized. I'm still really worried about what happens if we break through 7700 ( my guess is the next floor would be either 7200 or 6500) but it has been a good sign that we've been able to stay above it.
What is really impacting the economy now, and what makes this different than most of the recent recessions, is that this is really a two stage recession and we are only now hitting the second stage. All of the financial meltdowns of 2008 were really financial in nature. Banks having issues with mortgage backed securities is not something that directly effects regular people. The shock in the credit market and the failures of banks caused the huge drop in the stock market but did not initially impact most people directly. True, everyone became poorer on paper with les in their 401ks and a lower house value but their day to day paycheck was not effected. That is, until phase two began.
Which is where we are now. The companies that actually provide services are now facing with the credit crunch and know that they have to curtail their spending. This means massive layoffs, which started appearing in late 2008 but have been increasing in 2009. Now is when the recession hits the population. This is when people are unemployed and figuring out how to make ends meet. It doesn't get shown in the stock market as much (because the market is always a leading indicator) but it certainly gets shown in the American psyche.
What is next for the economy? I don't think we've seen the bottom yet but I don't feel as though we are too far removed from it. At least from a stock market perspective my fear of a 5000 Dow seems to be a lot less likely. What I expect more than anything is a very slow rebound. The only recent similarity that I can point to is the early 80's. This feels a lot like that recession (in that it is just brutal and no one can really explain why) and it took years to get back into a clearer view of the economy. So expect a few brutal months and then a little light showing at the end of the tunnel.
Thursday, October 09, 2008
Lightening the mood
Since things have been rather serious and dour as of late I feel that it is very important for me to bring the nation’s focus back where it belongs. Such as sitting in stunned disbelief after finding out that Jamie Lynne Spears is preggers again only four months after giving birth. Yes, Brittney’s little sister is playing catch up by having Irish twins before the age of eighteen. I somehow feel that a return to Nickelodeon isn’t in the cards at the moment. Unless we could use her as a star of “Clarissa Explains How She Made Some Really Bad Choices In Life” or “You Can’t Do That If You Were Using Birth Control.”
(The story is she didn’t think she could get pregnant because she was nursing at the time. I assume that her first pregnancy was due to the belief that you can’t get pregnant if you do it standing up or you can’t get pregnant if the day ends in a Y.)
Also, we are now down to the final contestants on Project Runway. Kenley the bitch makes it to the finale and as much as I hate her, based on the wedding and bridesmaid dresses she made she deserves to go. She was easily better than Kotto and Jerrel even if this is like the twelfth time she has acted stunned when someone said that her dress reminds them of another designers. Leanne, who is my favorite, put together two absolutely amazing pieces. The wedding dress was super cool and looked like something that both the bride and the mother of the bride could like but for totally different reasons. Her bridesmaid dress was actually pretty and when was the last time you said that about one of those.
(Yes, I like Leanne partly because she looks like Cat Power and is from Portland. Sue me, I just dig that style. Was bummed when her boyfriend got screen time tonight.)
In other media news I am rather disturbed by seeing Ashton Kutcher in commercials for Canon. Less because of my feelings towards Canon (fine camera products one and all) and more for the reason that I have no desire to see him on my television set at any time. I can’t even bring myself to watch reruns of That 70’s Show, though to be honest any episode in which Donna isn’t a redhead isn’t worth watching on general principle. I don’t want to see Ashton acting all goofy at a wedding. I don’t want to see him snapping pictures. I want to see him getting hit in the head repeatedly with a two by four. Now that would make a great commercial for Home Depot.
I’ll end with another quick discussion of the economy. Now when I say that I have watched the market for 25 years I am not kidding. My dad showed me how to read the financial pages when I was ten. I learned how understand stock symbols and make sense of the mass of numbers that filled the boring section of the newspaper. This was back in the day when stocks traded in eighths. We couldn’t even afford decimal points.
So I was paying attention when the 1987 crash went down. Now in some ways that was more destructive than what we are going through now. It was certainly quicker and more disturbing. Both took place in October as all crashes take place in October. It’s kind of a financial law. What is more interesting to look at is how the average person is impacted psychologically as opposed to financially.
Remember that we live in a much different world than we did 21 years ago. The average person had to wait until they read the stock pages the next day to find out where there stocks were and even then they could only make a rough estimate as to where there portfolio was. Everything took place in the mysterious world of Wall Street and it was an almost mystical place. Honestly, adults looked at me like a freak because I could figure out what a stock was trading at mainly because they had no idea how to read those pages.
Today everyone is an expert and can find out instantaneously. We all can jump on Yahoo and find the value of all of our stocks. If we want to be fancy we could build spreadsheets to automatically calculate our position. If not we can jump on a website and see the value of our 401K to the penny. As a result, peoples’ focus is constantly on the market. That makes life hell because if there is one thing you don’t want to do is look at those numbers on a minute by minute basis. Right now all you get is depressed. Long term all it does is force you to make bad decisions because those little fluctuations do not matter. The reason people are on edge now more than in 1987 is partly due to the fact that more of us are in the market than before. But mainly it is because the moment by moment changes to the market are broadcast to us instantaneously. Sometimes ignorance is bliss.
(The story is she didn’t think she could get pregnant because she was nursing at the time. I assume that her first pregnancy was due to the belief that you can’t get pregnant if you do it standing up or you can’t get pregnant if the day ends in a Y.)
Also, we are now down to the final contestants on Project Runway. Kenley the bitch makes it to the finale and as much as I hate her, based on the wedding and bridesmaid dresses she made she deserves to go. She was easily better than Kotto and Jerrel even if this is like the twelfth time she has acted stunned when someone said that her dress reminds them of another designers. Leanne, who is my favorite, put together two absolutely amazing pieces. The wedding dress was super cool and looked like something that both the bride and the mother of the bride could like but for totally different reasons. Her bridesmaid dress was actually pretty and when was the last time you said that about one of those.
(Yes, I like Leanne partly because she looks like Cat Power and is from Portland. Sue me, I just dig that style. Was bummed when her boyfriend got screen time tonight.)
In other media news I am rather disturbed by seeing Ashton Kutcher in commercials for Canon. Less because of my feelings towards Canon (fine camera products one and all) and more for the reason that I have no desire to see him on my television set at any time. I can’t even bring myself to watch reruns of That 70’s Show, though to be honest any episode in which Donna isn’t a redhead isn’t worth watching on general principle. I don’t want to see Ashton acting all goofy at a wedding. I don’t want to see him snapping pictures. I want to see him getting hit in the head repeatedly with a two by four. Now that would make a great commercial for Home Depot.
I’ll end with another quick discussion of the economy. Now when I say that I have watched the market for 25 years I am not kidding. My dad showed me how to read the financial pages when I was ten. I learned how understand stock symbols and make sense of the mass of numbers that filled the boring section of the newspaper. This was back in the day when stocks traded in eighths. We couldn’t even afford decimal points.
So I was paying attention when the 1987 crash went down. Now in some ways that was more destructive than what we are going through now. It was certainly quicker and more disturbing. Both took place in October as all crashes take place in October. It’s kind of a financial law. What is more interesting to look at is how the average person is impacted psychologically as opposed to financially.
Remember that we live in a much different world than we did 21 years ago. The average person had to wait until they read the stock pages the next day to find out where there stocks were and even then they could only make a rough estimate as to where there portfolio was. Everything took place in the mysterious world of Wall Street and it was an almost mystical place. Honestly, adults looked at me like a freak because I could figure out what a stock was trading at mainly because they had no idea how to read those pages.
Today everyone is an expert and can find out instantaneously. We all can jump on Yahoo and find the value of all of our stocks. If we want to be fancy we could build spreadsheets to automatically calculate our position. If not we can jump on a website and see the value of our 401K to the penny. As a result, peoples’ focus is constantly on the market. That makes life hell because if there is one thing you don’t want to do is look at those numbers on a minute by minute basis. Right now all you get is depressed. Long term all it does is force you to make bad decisions because those little fluctuations do not matter. The reason people are on edge now more than in 1987 is partly due to the fact that more of us are in the market than before. But mainly it is because the moment by moment changes to the market are broadcast to us instantaneously. Sometimes ignorance is bliss.
Tuesday, October 07, 2008
Your zombie economic forecast
Given that we just suffered through another 500 point drop in the Dow I thought that I should provide my view on the current state of the economy. As I do have an MBA in Finance I do possess at least a little background on the subject at hand. However, it should be noted that I am also a person who willingly paid money to see Weird Al Yankovic in concert and therefore my judgment cannot be trusted in even the best of circumstances. Here it goes, in handy question and answer format.
Q: So how bad is it?
A: Bad. Really bad. Guy coming after you wearing a hockey mask and a chainsaw bad.
Q: Eep! So what the hell is going on?
A: Let’s try to keep it simple. When you put money in the bank the bank doesn’t actually hold on to it. They lend it to people who then use it and promise to pay it back. As long as they do there is no problem. Except that now we lent to a lot of people who didn’t pay the banks back. And the banks invested in all of these strange financial instruments that were meant to reduce risk but in fact just made the risk larger. Now several banks are failing because they can’t cover what they owe while the others aren’t lending out money to anyone.
Q: So, what’s wrong with banks not lending?
A: Well, see, companies don’t actually carry cash. Whenever they need to do something (up to and including make payroll) they typically do it through a loan. Now they can’t do that so everything is seizing up. Hence, a huge downturn in the market until the credit market opens up again.
Q: What is your next to worst case scenario?
A: Dow drops to 7777 over the next several months and you have double digit unemployment (I’ll guess 12%).
Q: Why 7777? That is a rather precise figure.
A: 7777 is the next major psychological barrier for the Dow now that we have broken 10,000. Despite the fact that the number is rather meaningless people really do react to it. That’s why on Monday the market rebounded back to 10,000. They felt safe around that number. With that level gone the next safe zone is 7777, which exists because people really like the number seven. I’m not making that up. There is actually research that agrees with me.
Q: Ok, so what is your worst case scenario?
A: Complete collapse of the global economic system resulting in worldwide anarchy. However, for those of you who have heeded my advice and have prepared for the inevitable war against the zombies you will find that the plans that you have developed for that conflict will serve you well in such a situation. And no, I will not tell you where my secret hideout is. When the zombies rise we are all on our own.
Q: Wait a minute, as your ex-girlfriend won’t you come and rescue me when I call upon you for help while surrounded by zombies?
A: Ha ha. No. As anyone well versed in zombie defense tactics knows one of the first actions to be taken by any female with a known former male suitor who also happens to be a hopeless romantic is to call on said suitor for rescue. In the best case scenario, he will draw the zombies away from your position and provide a useful diversion as you escape. In the worst case scenario, he actually will rescue you and then you will have to patiently accept his company until such a time arises in which he can properly be utilized as zombie bait. Unless you are by my side when a Class 3 outbreak occurs you are out of luck.
Q: You really have put a lot of thought into this whole zombie scenario, haven’t you?
A: I keep a machete at the ready at all times. Blades don’t need reloading.
Q: Anyway, back to the market. Any suggestions?
A: If you’re my age keep plugging away at your 401K. Yes, you’ve lost a ton of money but that is money meant for thirty years from now. If the market doesn’t recover by then we will seriously be at the point where foraging for food will take precedence over retirement plans. I’d stay away from any company where they will need a lot of capital in order to start making money (sorry tech startups) until the debt markets open up. Always side on companies that make products that people have to use. People will need to buy diapers and razor blades. Otherwise, try to keep a good store of cash at the ready, have your resume up to date and start networking just in case.
Q: Ever seen the market this bad?
A: Nope. I’ve been following the market for 25 years (really, I have had my eye on it since I was 10) and I’ve never seen a configuration of events like this. The Dow is down over 30% in the past year. But, there are actually some positive signs. The whole world economy is hitting a recession and that means everyone is in the same boat and that provides opportunities for the first people to figure out a fix, which will most likely be the U.S. Plus, when people around the world get scared the money goes into the U.S. market because even in horrible times we are still the safest bet. The dollar is strengthening and the very weak dollar that we’ve had worried me more than anything. Oil prices are down and that should help provide at least a modicum of stability to the whole state of affairs. We haven’t bottomed out yet but at least I can see some positive signs out there.
Q: Still happy that you got a job when you did?
A: Yep. Might turn out to be the luckiest moment of my life. I’ll take employed in Delaware over unemployed in Kansas City any day of the week.
Off to watch the debate. Be vigilant! If anyone lurches towards you always ask yourself “Is that a zombie?” If in doubt, aim for the head. Better safe than undead I always say.
Q: So how bad is it?
A: Bad. Really bad. Guy coming after you wearing a hockey mask and a chainsaw bad.
Q: Eep! So what the hell is going on?
A: Let’s try to keep it simple. When you put money in the bank the bank doesn’t actually hold on to it. They lend it to people who then use it and promise to pay it back. As long as they do there is no problem. Except that now we lent to a lot of people who didn’t pay the banks back. And the banks invested in all of these strange financial instruments that were meant to reduce risk but in fact just made the risk larger. Now several banks are failing because they can’t cover what they owe while the others aren’t lending out money to anyone.
Q: So, what’s wrong with banks not lending?
A: Well, see, companies don’t actually carry cash. Whenever they need to do something (up to and including make payroll) they typically do it through a loan. Now they can’t do that so everything is seizing up. Hence, a huge downturn in the market until the credit market opens up again.
Q: What is your next to worst case scenario?
A: Dow drops to 7777 over the next several months and you have double digit unemployment (I’ll guess 12%).
Q: Why 7777? That is a rather precise figure.
A: 7777 is the next major psychological barrier for the Dow now that we have broken 10,000. Despite the fact that the number is rather meaningless people really do react to it. That’s why on Monday the market rebounded back to 10,000. They felt safe around that number. With that level gone the next safe zone is 7777, which exists because people really like the number seven. I’m not making that up. There is actually research that agrees with me.
Q: Ok, so what is your worst case scenario?
A: Complete collapse of the global economic system resulting in worldwide anarchy. However, for those of you who have heeded my advice and have prepared for the inevitable war against the zombies you will find that the plans that you have developed for that conflict will serve you well in such a situation. And no, I will not tell you where my secret hideout is. When the zombies rise we are all on our own.
Q: Wait a minute, as your ex-girlfriend won’t you come and rescue me when I call upon you for help while surrounded by zombies?
A: Ha ha. No. As anyone well versed in zombie defense tactics knows one of the first actions to be taken by any female with a known former male suitor who also happens to be a hopeless romantic is to call on said suitor for rescue. In the best case scenario, he will draw the zombies away from your position and provide a useful diversion as you escape. In the worst case scenario, he actually will rescue you and then you will have to patiently accept his company until such a time arises in which he can properly be utilized as zombie bait. Unless you are by my side when a Class 3 outbreak occurs you are out of luck.
Q: You really have put a lot of thought into this whole zombie scenario, haven’t you?
A: I keep a machete at the ready at all times. Blades don’t need reloading.
Q: Anyway, back to the market. Any suggestions?
A: If you’re my age keep plugging away at your 401K. Yes, you’ve lost a ton of money but that is money meant for thirty years from now. If the market doesn’t recover by then we will seriously be at the point where foraging for food will take precedence over retirement plans. I’d stay away from any company where they will need a lot of capital in order to start making money (sorry tech startups) until the debt markets open up. Always side on companies that make products that people have to use. People will need to buy diapers and razor blades. Otherwise, try to keep a good store of cash at the ready, have your resume up to date and start networking just in case.
Q: Ever seen the market this bad?
A: Nope. I’ve been following the market for 25 years (really, I have had my eye on it since I was 10) and I’ve never seen a configuration of events like this. The Dow is down over 30% in the past year. But, there are actually some positive signs. The whole world economy is hitting a recession and that means everyone is in the same boat and that provides opportunities for the first people to figure out a fix, which will most likely be the U.S. Plus, when people around the world get scared the money goes into the U.S. market because even in horrible times we are still the safest bet. The dollar is strengthening and the very weak dollar that we’ve had worried me more than anything. Oil prices are down and that should help provide at least a modicum of stability to the whole state of affairs. We haven’t bottomed out yet but at least I can see some positive signs out there.
Q: Still happy that you got a job when you did?
A: Yep. Might turn out to be the luckiest moment of my life. I’ll take employed in Delaware over unemployed in Kansas City any day of the week.
Off to watch the debate. Be vigilant! If anyone lurches towards you always ask yourself “Is that a zombie?” If in doubt, aim for the head. Better safe than undead I always say.
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