“I rant and therefore I am”… Andrew Horowitz
Of Mice and Anal-ists
It is awfully irritating to read and listen to the post game shows. FELLAS: we already know that the market tanked! What we need is prediction and pre-market assessments! Unfortunately, it seems that the art of forward thinking is all but dead. This struck me hard as I listened to one of my favorite podcasts yesterday and heard strategist David Goertz from HighMark Capital give his best advice for this market. He went on to give two examples of stocks to own now; Intel and EMC.
Does he think we are idiots? EMC, the stock that spun off one of the hottest IPOs that day. EMC, who would benefit from the 90% ownership of VMWare that opened at $50 from an IPO pricing of $29? Fortunately, he did go on to predict that it would be light during the day and dark at night…
Just a few weeks ago, anal-ists and rye-ters were all singing the praises of this market. They were chirping a lovely tune about the immense amount of liquidity and opportunities ahead of us. Little was said about the growing chinks in the armor that seemed as apparent as the “pink-on-cramer.”
Now, the “experts” on sites like bloggingstocks.com are busy telling us how the market may move lower and it seems that bullish commentary is hush. Thanks! These are the same amateurs that make the same mistakes time and time again only to find themselves out in the cold with no jackets during the winter months.
To be honest, I really wonder if many of the folks discussing the markets are simply out-of-work real estate moguls, now turned investment advisors. Whatever they are, I think that if THE Donald were here, he would surely say…YOUR FIRED!
The Numbers Don’t Lie…
This time around (which by the way is no different than any other time, even though they always say: “it is different this time…”) we are seeing a spike in the number of financially oriented websites along with a slew of bloggers who are benefiting no one. Their hyperbole and hysteria surrounding names like Baidu (BIDU), Apple (AAPL) and Croc’s (CROX) is enough to make anyone feel sorry for their misguided optimism. These are not bad companies; we are simply seeing bad analysis of these companies.
I recall a time that we saw an amazing increase in the number of Series 7 registrations in 1987, Real Estate Agents in 2005 and the record breaking number of CFP applications in 1994. What these have in common is the simple fact that people want in on the action. Greed and Fear, the two most talked about words these days are always at work in the financial arena.
ARMs For The Poor
Now, the record number of financial blogs, podcasts, wiki’s and television shows along with the countless number of money related sites should have been an enormous warning flag. When we allow ourselves to believe the talk of the time and buy into what we know to be counter-intuitive (right, so you believed that 100% financing and interest-only ARM loans posed no long-term problem) a light bulb should go off (actually, 50,000 volts should pass though our body) to remind us that something is not quite kosher.
In the end, these types of market corrections help to wash out the excess. That excess pertains to stock prices as well as the hot-air blogging fad. Watch and wait… I hope at least, for their sake, they will be able to collect unemployment benefits.
* Note: Discussion is somewhat limited to those “part-time” bloggers who write for THEIR own benefit. You know who you are….