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Friday,
May 22, 2009
(Cont'd from
above)...
Jim (cont'd):
Or how about the
fact that
Fifth Third Bancorp (FITB)
and
KeyCorp (KEY)
- two nare-do-well
Ohio banks - that I
thought could be
seized, are able to
raise billions of
money in this
environment?... That
should be cause for
celebration. But,
instead, we barely
notice...
Or how about all
those dopes who have
been calling for us
to nationalize the
banks because they
are "insolvent"?...
I mean, that
presumably includes
Bank of America (BAC),
right?... What do
those buffoons have
to say about how a
totally insolvent
company just raised
$33 billion?... I
guess the buffoons
ting that money
doesn't count, and
we'd be better off
if BAC became
something else...
how about along the
lines of "The U.S.
Postal Service &
Bank of America?"...
You know, if you had
told me three weeks
ago that every major
bank would need
capital, and then
that they'd each be
able to raise that
capital, I would
have said you're out
of your mind... a
total lunatic...
and, believe me, it
takes one to know
one! But, somehow,
we don't linger on
the incredible
occurrences. Tell
me... did anyone
believe that
Chrysler and soon,
possibly,
General Motors
(GM),
could go bankrupt
and it won't tank
the market? Let
alone, actually have
it go higher? How
could that be?...
Who thought that the
U.S. government
could be borrowing
trillions of dollars
and still mortgage
rates could come
down?... Still under
5%?... I mean, all
day, I'm hearing
"the 10-year... oh,
interest rates are
soaring"... For
heaven's sake, no!
It's supposed to be
impossible to keep
mortgage rates down.
They are. But do we
focus like a laser
on any of this?
Nah... We treat each
of these astonishing
things as if they
are total snooze
fests...
Here's another good
one that I can
barely even get
around my head?...
Can you comprehend
just how few
companies have
actually gone
bankrupt in our
garden-variety
depression?...
Almost none... In
previous recessions,
the bankruptcies
were stacked up like
pancakes...
Each of these things
have happened...
they have
happened... and,
instead of breaking
out the Dom Perignon
and celebrating, we
just immediately
move on, and start
worrying about the
next thing...
Two weeks ago, it
was the small uptick
in Treasury
yields... Please...
as someone who used
to hawk Treasury
Bills when they
yielded 14%, I have
trouble getting
nervous when they're
at 4%...
We worry about the
AAA credit rating of
the United States...
we fret about a
decline in the
dollar... what it
will do to those
ratings... even
though a weak
greenback is good
for those
companies... I have
to tell you that I
am not worried about
that... which leads
us to the $64,000
question...
Why does nothing
positive that is
gigantic ever matter
as much as the much
piece of data that
is coming, which
probably isn't
nearly as
important?...
You know what? I can
answer that question
for you tonight,
because I moonlight
as a journalist...
When you're a
reporter every week,
you look at the
calendar and it
tells you what's
coming up... that's
what you do... you
go over and say, oh
look at these events
next week... Now you
will be desperate to
produce exciting
news that grabs
eyeballs... that's
part of the game...
so you have to make
whatever's coming up
seem mucho
dramatic...
Oh no, existing home
sales... huge,
huge... and then the
next day... Oh, new
home sales...
wow!... Durable
goods on Thursday...
that trumps
everything. Forget
about whatever good
things might have
come before
Thursday, because
the incredible
totally amazing
market-hanging-on-whatever-durable-goods-number
awaits us...
Oh my... I'm
breaking out into
even more than the
usual sweat... You
see, there is no
perspective, because
there can be no
perspective... Is
that too
circular?...
Okay, think about it
like this...
We in the media
business have to
have something... we
have to say
something every day.
I mean, we've got to
have something.
Otherwise, what the
heck are they paying
us for?...
It's really
important but,
because of the
nature of what we
cover, we can't just
talk about the
Yankees and
Phillies... Or
should we talk about
whether Adam Lambert
was ripped off?
That's another kind
of show... We can't
promote new
products... That's
someone else's
gig... we can't
teach you how to
cook... we can't
teach you how to fix
up an old house
either...
And, while we can
try to entertain
you, I can tell you
from personal
experience, the
risk/reward on that
one stinks...
We don't get any of
that... What we can
tell you is the data
that comes out of
Washington each
day... or a chamber
of commerce
somewhere... or out
of a Fed bank in
Virginia...
We take every
macroeconomic number
and we blow it
totally out of
proportion... even
to the point of
obscuring the many
good things that
have actually
already happened.
But you know what?
Forewarned is
forearmed...
You don't have to
trust the Journal's
perspective... in
fact, doing so is
deadly... its
misdirection
plays...
Now that you know,
you can keep it in
perspective. Measure
the bits of data
that come out
against the real big
kahunas... treating
each piece of news
as though it's
happening in a
vacuum?... No!
You've got to think
of these things...
no matter how much
the press tries to
hype them... as
being skirmishes...
These are like the
skirmishes between
the rebels and the
union... in the
completely and
utterly unimportant
weeks leading up to
Gettysburg...
Consider it the
routine days before
the Germans stormed
Stalingrad...
Take these little
pieces of data for
what they are...
essentially pot
shots fired... all
data is created
equal, but some are
created equally than
others... meaning,
not equally at
all...
If you can't
understand that,
then you're going to
be shaken out, every
time things are
good, and you'll be
riding right into
the buzz saw when
things are bad.
Here's the bottom
line...
▼ ▼
▼ ▼
▼
 The Bottom Line!:
Don't be slaves to
the "day book" as we
used to call it back
when I was a Daily
General Assignment
reporter, counting
on events that you
knew were going to
come out...
different days to
fill the pages,
cyberpages or
airtime... Instead,
be an indentured
servant to the big
picture... It will
eventually set you
free... And always
recognize the goals
of the press, and
the goals of
investors, are not
the same thing.
[verbatim recap]
[end of segment]
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