I'm just amazed at how many people are blaming Greenspan and the Fed for the tighter monetary policy which led to this alleged recession, although I shouldn't be. I blame the Fed for their part in contributing to the mania just passed.
Thought that Greenspan finally showed me some signs of responsibility this week, so I'm going to somewhat lay off my criticism of his being a totally political animal - for the time being at least.
The market segments that had everyone so lathered up for the last couple of years had no business selling at those valuations, or even the ones we have today. So, what is happening now was quite inevitable and predictable, save as to timing. And now people are talking as though we're faced with surviving the Great Depression (who know's we just might wind up there?) Sorry, I have thought and continue to think that this country's in trouble.
So once again we can see that Denial ain't just a river in Africa. Many choose to believe that the justly deserved return to economic and market Nirvana is just a wave of the interest rate cut wand away. Many share the view that a point of simple overvaluation for the key stocks must certainly only be a launching pad for the next meltup. Others choose to dance in the path of the boulder that they know must fall, certain that they can foresee the timing of when it ultimately will. A correction is still needed - one of attitudes, and views towards risk.
And now I understand that it's the "smart money" that came in and ran AMCC from 23ish to 32ish in about one hour late yesterday after a profit warning, and who aggressively bought IBM on some BS rumors <G>. What next?
This all seems so foolish to me. It seems as though nobody worked for the money that they are now playing with. Gambler's syndrome pervades. Granted, it's only money, but painful nonetheless to watch people you know and care for continue on a path of self-destruction. The rally that they hope will save them will only reinforce their allegiance to gambling, that of taking wild uncalculated risks. They must be in the riskiest positions as only those will quickly ease the pain. And this while a broader bull market of sorts is taking place. Go figure.
I should be too young for such cynicism, sorry. I just can't espouse the view that capital markets are a friendly place, but rather view them as a shark's tank.
While always holding out the possibility that I could be full of it, I'll fall off of my soapbox for now.
Have a great weekend everyone.
TM |
