It's A Deal
October 17, 2008
'Bright Lights, Big Writedown'
I'm thinking of giving up my Wall Street Journal subscription. And definitely no more Bloomberg TV. I just don't need these media sources to know what's going on in the financial markets these days. I have a more reliable indicator, and it's free: TV trucks.
You see, every day on my way to work I walk down Broadway, past Wall Street. It seems the mainstream media not long ago discovered something was awry in financial circles, and now you can't keep them away. Vans everywhere, pretty people standing on those mini stages (there's a name for those in the TV biz, I just can't remember what it is), talking breathlessly about the Street's villains, just up the block from the NYSE.
You know it's a big day (say, a 500-point selloff) when there are six or seven of these vans lining the streets. Two or three? Hmmm, maybe the market didn't collapse. Tellingly, the day after the 900-point surge, I didn't see much more than I normally would for your run-of-the-mill 250-point move.
And that's what got me thinking, again, about the state of the current market. The mental state, that is. Think about what's going on here: governments around the world are falling over themselves to make it virtually risk-free for banks to lend to consumers and to each other, yet there is still an overwhelming reluctance to do so.
The same crowd that was convinced at the start of this decade that "eyeballs" and bandwidth were legitimate metrics on which to base huge amounts of borrowing and lending can't get up the courage to dole out funds to giant, legitimate businesses, even when their government is darn near forcing them to do it.
And therein lies our problem: it's a lot tougher to regain shattered confidence than it is to pile into momentum stocks that are heading higher.
Much has been made of the "confidence" issue, and rightly so. No confidence, no lending. No lending, no nothing. Most people get that ... they just don't want to go first.
In the end, I'll still read the Journal (after I'm done with IDD, of course), and I may even turn on the tube for some business news. None will be able to call the bottom--no one can--but I'll know the worst is behind us only when the vans pull away for good.
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