Wall Street: Dumb as It Ever Was 76 comments
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I had to take a few moments away from shouting at the circus-of-the-inane on CNBC to vent. All the focus on this jobs number this morning should confirm to any rational person that the great majority of what goes on in Wall Street is a complete waste of time at best and a criminal destruction of value at worst.
Being trained as a scientist in a former life just makes it harder to watch this garbage. Yesterday afternoon some random NYSE floor monkey, CNBC's "expert of the moment", expounded that if the unemployment rate came in at 9.9%, the market was going to the moon, Alice. But (God forbid) if the rate was 10%, we're all doomed. At which point my left eyeball began twitching followed by my Bond-trader office mate and I embarking on a 30 minute session of throwing things (literally and figuratively) at the TV. Only a session of cranking some classic reggae could calm us.
10% vs 9.9% - this my friends is far less than a rounding error. It means less than nothing, It is simply a round number vs. a non-round number - NOTHING MORE. And based on this alone, truckloads of money is wagered on Wall Street. Consider that today's jobs lost were 190k vs a consensus of 175k. Good God, the unemployment rate is 10.2%!!! Head for the fallout shelters! We missed consensus by 15 THOUSAND jobs. Never mind that September was revised better by 44k jobs, and August better by 46k. And never mind that the consensus is a compilation of predictions made by economists that have no better way (or past record since the beginning of recorded history) to predict the economy than the seagull circling my building. The one advantage they have is that people ASK them to predict the future, and PAY them to do so. As far as I know, no one does the same for the seagull. That is, unless he "calls" (caws?) a market bottom or top. Then he'll be guest host on CNBC for sure. The only question then will be whether a gull can out-bellow Kudlow.
Please try to remember in the face of this noise that the only good INVESTMENTS (as opposed to speculations) are those that do not require you to predict the future. And these are getting tough to find.
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I know of at least 10 companies, all in business for decades, that are in this boat.
Obviously, the "productivity" is through the roof!
Shame on your contractor friends for allowing - no make that enabling - tax cheats and dodgers. Just screw the rest of us even harder - great plan for their future success.
On Nov 07 03:20 PM cameraguy wrote:
> Then there is the productivity numbers. Anecdotal comments: I've
> been talking to a number of consruction type and service companies
> lately.
>
> They are ALL using contract laber and day labor, many of whom are
> also drawing unemployment. Unless the was a substanitial amount of
> this type of labor being employed, how could productivity increase
> 6% last month and 9% this month?
>
> The official unemployment rate is overstated by about 2%.
> At this stage in an economic recovery many of the unemployed are
> "lest unemployed" than they were early in the year.
> The productivity numbers are the tip off.
Watching people watch the market even as the Fed creates more money and unemployment continues to rise has certainly been an interesting experience.
My plan? Savings goes to metal I can hold in my hand, investing goes to companies I hope can survive this freakish bastard president and his cohorts. My hopes for prosperity are pinned on a future where Americans have finally been awakened to their being responsible for their own welfare and sick of playing games with socialism. There is no prosperity to be had now simply because the value of our currency and our investments are controlled by men and women hellbent on buying votes from the poor with promises they cannot and never had any intention of keeping while railing against the middle class by calling them rich.
We are in a war against the middle class, paid for by the likes of Soros, and aided by the poor who know no better.
On Nov 06 10:20 AM American in Paris wrote:
> Shadow Statistics is a bunch of rubbish. I have a background in statistics
> and am intimately acquainted with how the government samples populations
> to to form estimates. It's quite solid.
>
> Shadow Statistics is just one notch above the Conspiracy Theorists.
> Just one short step ....
How did that work out for you? The market made it up to 60%+, is still at +58% and may go higher. (By the way, I have a statistical and scientific background too.) Maybe you should lighten up on the prognosticators--if you want peace from CNBC, turn off the damn TV.
On Nov 07 11:40 PM David Van Knapp wrote:
> You dump all over prognosticators, yet you are one yourself. Just
> looking at your last article (from late July), you had this to say:
> "Now that the market has run up some 46% since the last Running (away)
> of the Sheep, the wooly stampede has reversed direction. Will the
> carnage be just as bad this time? History says yes..."
>
> How did that work out for you? The market made it up to 60%+, is
> still at +58% and may go higher. (By the way, I have a statistical
> and scientific background too.) Maybe you should lighten up on the
> prognosticators--if you want peace from CNBC, turn off the damn TV.
On Nov 06 09:58 AM Cuthbert wrote:
> Well, "dumb" is one word. I would suggest this change in your title
> "Wall Street: As Human as It Ever Was". This isn't science. It's
> human nature. That's why FDR was right to identify "fear" as the
> enemy.
> 10% is up. It's a new level, and it "sounds" like a lot more. If
> you don't think this makes a difference, try explaining why all the
> stores price items with prices like $9.99 instead of $10.00.
I do miss Rick Santelli though.
I now trust myself more than ever to make good decisions and not let the hysteria on this channel wreak havoc in my mind.
However, if you are a trader, you'll likely suffer because you miss the opportunity to take the other side of the trade some guy is jawboning.
Give it a try
Now CNBC is using the weak dollar for the reason. Who to say it isn't the same people manipulating oil prices, that might be manipulating the price of the dollar.
Demand for Distillates down 18.8% but their still bidding up the price.
seekingalpha.com/artic...
www.reuters.com/articl...
On Nov 07 11:43 AM Billy Ford wrote:
> I believe the market is being completely manipulated. This administration
> knows that sentiment is mostly driven by the stock market. Notice
> how last year when the market was tanking sentiment was at all time
> lows, but today because the market has unjustifiably been rising
> for 7-8 months, that sentiment is better. People, are our economy
> is worse today than it was last year. The administration and they
> guys pulling the strings are hoping and praying each night that this
> consumer sentiment will eventually catch up and people will feel
> comfortable going out and spending money. What will happen when we
> face reality and know that the fundamentals associated with +10%
> unemployment will trump sentiment. The people with money, who can
> influence economies the most see through these charades, and truly
> realize that we are not recovering fundamentally. The only thing
> recovering is a manipulated stock market, which in itself is a bubble
> waiting to burst. Just a few questions that I ask myself. If we are
> recovering as the market suggests, then why is fed not even considering
> raising rates? It's simple, because fundamentally nothing is happening.
> Where is this stimulus going? It certainly isn't being used to fuel
> any kind of recovery, unless recovery is banks hoarding cash to cover
> losses from last year and expected losses of the future. People wake
> up, banks are hoarding cash for a reason, they are expecting MAJOR
> losses in the future. Other companies are hitting targets because
> of one thing, cost cutting. What happens when there are no more costs
> to cut, and we continue to see top line revenues flat? Yes, I am
> a bear and I believe our country has seen its best years. Manipulation
> can only work for short periods of time, and it will be only a matter
> of time before the rest of you wake up and see that we are way worse
> off than the media and the government play it out to be.
Bottom line is that we're in a terrible employment situation. The numbers are horrible. Without some sort of renaissance, the employment numbers will become a structural issue.
www.planbeconomics.com.../
Why choose between individual sectors of the market to invest in? With a quality index ETF (QQQQ, SPY, etc.), you can invest in the ENTIRE market.
Want a little volatility in your portfolio? Invest in bull and bear ETFs at the same time.
Guessing games are for amateurs.
Michelle Caruso-Cabrera ... RAWR! :-)
On Nov 07 02:41 PM PizzaMan wrote:
>
> At least some of the CNBC cast is easy on the eyes. Just turn down
> the sound.
Appearantly you have NEVER been to Germany, or Europe probably
see recent "2009 Country Brand Index Ranking Highlights "
Best Country Brand for Standard of Living, in order:
Germany, Canada, Japan, Finland, Singapore
Where's the USA?
On Nov 06 01:25 PM Mad Hedge Fund Trader wrote:
> Ouch! Another 190,000 jobs went down the crapper in October, taking
> unemployment rate to a new 27 year high of 10.2%. Add in discouraged
> job seekers, and that puts the jobless rate at gut churning 17.5%,
> and over 20% in California. Along with yesterday’s stunning, gob
> smacking 9.5% increase in Q3 productivity, the figures point a giant
> arc spotlight on what is really happening in the economy. Companies
> are still firing workers en mass to boost profits. After getting
> blood from a stone they are returning to the same rock for one more
> drop. I guess if I fire myself, the profitability of my business
> would go through the roof too, and maybe even my stock would rise.
> At least then I would then be rid of my oldest, most expensive but
> least productive employee, who is the worst to get along with, max’s
> out his sick and vacation days, and wears the same clothes to work
> every day, even when there lipstick on the collar. But then who would
> write this daily letter? Maybe Cecelia, my cleaning lady, would do
> it. She’s cheap. This explains why when you go into Office Depot
> these days, there is only one minimum waged employee standing at
> the cash register, the hours on the phone I have to wait to get technical
> support from Dell, and the endless unmovable lines at Citibank. America’s
> service economy has become all about denying service to customers.
> The scary thing is, with companies firing their way to prosperity,
> what happens when we get another dip? My theory is that the US has
> entered an era of chronically high employment that is never going
> away, no matter what the government does. Goodbye USA, hello Germany!
"I'm with stupid" is something all the Bank of England MPC members can say during meetings.
probabilities", just in layman terms.
In both cases you have to think what MAY happen
and how LIKELY it is.
Of course nobody (?) will "predict" future in a sense of "100% probability".
> Investment is about managing probabilities & risk and has nothing
> to do with predicting anything!
The ongoing Industrial/Cybernetic Revolution is going to keep replacing (world-wide) human labor with automation, increasingly faster than human labor-required tasks can be produced. Thus we need either a revolution in "economic resource distribution" or else there will need to be a lot less people. If you don't help me with the former, the latter will be the result.
Let me know asap: time grows short.
On Nov 06 03:40 PM cayman wrote:
> what songs were in on that reggae session ?