8 Alpha-Zulu

Has the Market Become Immune to Bad News?

Technology is part the culprit: the internet, cable TV, PDA's, cell phone updates etc... have deluged us with information 24/7/365; we gobble up stats, information and rumor as though we are drinking it through a firehose and the spiggot is being turned up daily. The market is based on the flow of information from one party to another and this info now whirls around us tornadically. We consume this information so rapidly that we have become nearly totally desensitized to it. Good News, Bad News, Any News is better than no news.... right? Wrong. Too much information and a complete void of cogitation and thoughfulness is as bad as not enough. Action for the sake of making a move is the day's m.o. and it is virtually impossible to regulate lightning speed market movement until we are too far down the river to prevent disaster. Do you think that Dick Fuld, "under the world's spotlight" would have been able to go unnoticed as he bonused out management at Lehman 2 days before filing BK if we all weren't moving so fast that we overlooked it? There are thousands of daily examples like this where the quick pace of Wall Street, the authorities inability to regulate same at this pace and the shear velocity of our day-to-day trading lives promote greed and the ability to successfully exculpate ones self from punishment or negative ramifications because its too late by the time the wrongful action is discovered.

I contend that action without thoughtful educated consideration for the sake of "moving quickly" is why the .VIX stands where it does, why Wall Street has no able overseer (which has allowed it to succumb to pure premeditated greed) and generally, is one of the main reasons that we are dealing with the great recession today.