Welcome back to The Investor's Coroner, an attempt to make both sense and fun of the current global markets and inform you of the happenings in the international marketplace while using hidden messages to help you find the Bush family offshore bank accounts in the Caymans.
It is a goal of the Investor's Coroner to make you laugh, help you learn and just generally bitch and moan about how uncool poverty is.
Market Hits Low, Turns Around and then Hits Rihanna
The Dow Jones Industrial index hit a low of 6500 a few days ago, causing me to win a hundred bucks from a bond trader named Frank. You see, I told Old Man Frank that the DJI would hit 6500 back when it was at 9200. He called shenanigans and then bet me a hundred bucks that the DJI would never hit 6500 and that if it hit 6500 before June 1st, I would receive my cash. Well, Frank was a man of his word and I got my money.
I told other people the same thing about the DJI and when it turned out I was right they all wanted to know how I predicted it. After all the questions, I realized that most people don't know that the DJI is but a small sampling of some of the companies on the NYSE. By replacing every failed bank stock on the DJI with strong companies like Google, the market would appear to turn around. An index is just a view of a few stocks and the DJI is actually the least reliable economic indicator (for my money, the S & P 500 is a much better indicator because it consists of a greater number of stocks that represent the diversity of the marketplace).
Anyway, I knew we'd hit 6500 for the following three reasons: the bank stocks that live in the DJI are as broke as the government bailing them out, the market was fighting to give up all of the pre-tech bubble gains in an effort to show the world that bubbles all burst in the end (think about it… have you ever heard of an everlasting bubble?) and the mass psychology of fear sentiment (i.e., everyone thinking that this is the worst market we've been in since the 30s) would push the DJI back to its pre-tech bubble life. Now, let's talk about the turn around (isn't this fun, America?).
(America collectively shrugs.)
The turn around that we've seen in the last few days is not an indicator of a rally. I know it looks like a rally. It smells like a rally. It even wears its cap inside out it's so much like a rally. But it's not a real rally.
When a market rallies, typically the stocks that shoot up are the leaders in their respective marketplaces. This market is actually being pushed up by news that things are not as bad as we feared (and they weren't, which is why the DJI should have never hit 6500 if people were rational but they're not rational which is why I knew it would—you're still following this, right?). In other words, the stocks leading this rally are the shittiest on the market but they're not as shitty as they used to be because we used our hard earned money to give them money to be not as shitty as they once were.
So… what happens next?
Segue time bitches!
The Future Looks Blight: I Gotta Wear Braids
The stock market has hit its bottom for this market cycle (pending natural disasters) but the recession/depression/fucked times are nowhere near over. You see, one of the things that makes the stock market so difficult to predict is that it looks forward, i.e. it factors in what will happen in the future. When a stock market hits a low, it basically says to everyone around it, "Shit will be better in six to nine months" which means that the worst times for unemployment are still ahead of us. Feel free to groan.
That felt kinda good, didn't it?
Now that the government has increased its market manipulation schemes, we can expect a decrease in global consumption. It is very difficult for us to consume when we're paying for people to work so that they may consume. In other words, we're totally fucked, speaking from a long term perspective.
I guess what I'm saying is that the DJI should be around 9000 by December but you still won't have no job.
But Someone's Making Money Right?
Epiq systems is posting record profits. Epiq systems specializes in bankruptcy software. If you're looking for the joke in this paragraph, you need to understand that some jokes are too easy, even for me.
That Madoff Dude Is Going to Jail
And he thought he made off with billions. Get it? Made off. Madoff. I'm a fucking comedic genius.
But seriously folks, his hedge fund managed to pay everyone the same amount every month for years. Stocks don't do that. If you couldn't smell that bullshit it was only because you were too busy eating the steaks. (That made sense when I said it over dinner three weeks ago—now I'm not so sure. Whatever. I'm hungover.)
Those Guys at Google are Fucking Geniuses
It is no secret that our grandparents' generation simply never wanted to know how they were being marketed. Our parents' generation simply didn't want to acknowledge that they had some understanding of how they were being marketed. My generation bashed marketing repeatedly until some commercials actually got funny. And future generations, well they will simply market themselves.
Google is going to release a function that allows users to state what kind of ads they would like to see while they surf the net. So while you're reading this, you could see tons of advertisements for whatever you like (porn). Really, it could be anything (porn). Whatever tickles your fancy is just fine (porn).
Twitter Don't Need Your Stinking Money
The owners of Twitter are consistently and constantly turning down buyers, saying that they are just fine and dandy like lemonade candy, thank you very much (they said it rather tartly). I predict that they will regret this decision two years from now when they are an afterthought like The Segue and Pepsi Clear, but what do I know? I'm still hungover.
Jon Stewart and Jim Cramer need to Ease Up
Jon Stewart interviewed Jim Cramer after a week wherein the former bashed the latter's network and all I have to say about this is FUCKING YAWN. Stewart has tried to blame CNBC for hyping up the market as it collapsed and Cramer went on The Daily Show to defend himself. And I fell asleep.
Government regulation and manipulation of the market has always been the problem. From 1913 when they created the Federal Reserve Act to the Gold Reserve Act in the 50s to the current bailouts and manipulation of dollars they create out of thin air for the purposes of controlling us. Jim Cramer is just a douchebag who runs a stupid show and if anyone gets their financial advice from a bald guy who honks horns on TV then they deserve what they get. Getting financial advice from Cramer is like getting your news from Stewart. Sure, it may be easier than actually thinking but it won't get you far.
My point is that Cramer's time would be better spent relaying how his hedge funds made so much money and Stewart's time would be better spent focusing on being George Carlin Light and neither one of these guys has any real answers. Instead they have TV shows. CNBC is not the problem. Jim Cramer is not the problem. Hell, Madoff isn't the problem. The problem is, quite simply, a government that manipulates the markets to its own end.
So how do we Fix This?
We abolish the Federal Reserve. We abolish the IRS. We stop printing money out of nothing. We stop treating the government like some rich parent with an endless supply of cash. We, in short, grow the fuck up.
We're not gonna do that though.
What will we Do?
We will point fingers. We will line up all the Madoffs and the AIGs and the rating companies and the rich executives and the insurance companies and we will beg our governments to fix the problems. And our governments will steal money from us, from future generations and from anyone else they can so that their quest for more centralization of power will be met. And we will feel like we've done something even though we haven't done anything. We're Americans, dammit. And that's how we get down.
New Innovations No Better than My Whore Girlfriend
MIT scientists have developed a battery that charges in 20 seconds. Your microwaved burrito, however, will still take at least a minute.
New research shows that salt is an antidepressant, which explains why women, who crave less salt than do men, suffer more from depression. That's still no excuse for overheating my microwaved burrito though. And stop crying bitch. You like it when I slap you. You may tell me no but your black eye screams yes.
Your Motivational Investment Quote of the Week
Government's view of the economy could be summed up in a few short phrases: If it moves, tax it. If it keeps moving, regulate it. If it stops moving, subsidize it.
—Ronald Reagan