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Are We Too Gloomy?

That's the question asked by the Washington Post:

"Soft? You betcha. In recession? Quite possibly. And a crisis in the financial markets has rattled nerves for months now. But so far, the economy is holding up better than it did during the last two recessions in 1990 and 2001. Employers haven't shed as many jobs, the unemployment rate is still relatively low, and gross domestic product has kept rising. Things are nowhere near as bad as they were in the Great Depression, or even during the severe recession of 1982-83. The last time consumers were this miserable, in May 1980, the jobless rate was 7.5 percent and inflation was 14.4 percent. Now those numbers are 5.5 percent and 4.2 percent respectively."

The naked comparison between the stats today versus 25 years ago -- without some context -- is misleading, and perhaps revealing of economic naiveté. Even if you take the headline data at face value (which you never should), one must acknowledge the many changes which have been made over the years to how the BLS models are constructed. It becomes an apples to oranges comparison. Perhaps the fault lies not within ourselves, but within our data.

Instead, we should be asking different questions of our financial media:  "How economically literate Is our press? What degree of statistical naiveté is endemic to mass media? Why our some of the financial media mere stenographers? What happened to critical thought, analytical rigor or investigative journalism? Wasn't the charge of the press at one time to "afflict the comfortable?"

To be blunt, any scribe that trots out the headline data on Unemployment or Inflation as gospel are fools or liars.

Of course, there are other possibilities:  IIt could be that we Americans are ungrateful; we are morons, too dumb to understand just how good we have it. Or, another other option is that the official models, like every mathematical depiction of reality, are flawed. It is not that they are worthless, it is that they are an imprecise and inaccurate depiction of the real world. They cannot be anything but, as they are merely a partial depiction of the universe.

Do not think that the present issue is whether any model is right or wrong; All models are wrong. The true question for interested statisticians, mathematicians and economists is just how wrong are they?   

Here are a few clues for those who do not seem to understand why so many Americans seem so unhappy despite the current state of economic affairs in the world:

• Prices have far outstripped wage and income growth, leading to the first major decrease in the standard of living in the US in the modern era.

• Its more than food and energy prices -- medical care and education costs have gone up 10-15% per year, local municipal and property taxes are rapidly rising, and yes, even free-falling housing remains considerably higher relative to median income.

• The US savings rate flipped into negative territory for the first time since the Great Depression. That doesn't mean we are going to go into a depression -- but its no reason to be cheerful.

• Curiously, this article on sentiment failed to mention either of the words "Iraq" or "War." How in a discussion on psychology, can there was no mention of War fatigue? There is a weariness related to the ongoing costs and casualties of the Iraq War, even as it slides off the front pages. It has worn on the national psyche for more than 5 years. Yet that was not worthy of any mention; That reeks of hackdom.

• We are barely a quarter or two into what is still not acknowledged as a recession by many. The danger, reflected in Sentiment data, is that the economy rolls into something far uglier --a deeper and more prolonged contraction.

As to the broader state of the economy, let me direct the author of this one column to yesterday's Federal Express (FDX) earnings. The economic bellwhether's report were nothing short of fugly. FedEx management issued an inflationary-recession view of the economy. FedEx lost $241m due to what they called "soaring fuel costs and a very difficult economic environment." They are primarily a business-to-business shipper, but UPS, their more consumer oriented competitor, had very similar things to say. In terms of future guidance, FedEx CFO Alan Graf said that the coming year will be “very difficult due to the weak U.S. economy and extremely high fuel prices.”

Gee, that doesn't sound like our economic woes are psychosomatic. 

~~~

We have discussed over the past 5 years how inflation is so much worse than reported. The latest pushback against this meme has been not only wrong, but lame. Its a difficult argument to make, and this is a typical weak example of exactly why that is.

I'll have more on some other inflation related nonsense later today; tomorrow, we will look at those who accuse we who challenge the official data as tin foil hat wearing, grand conspiracy theorists . . .

>

Previously
Consumer Sentiment Hits 28 Year Lows (June 2008)
http://bigpicture.typepad.com/comments/2008/06/consumer-sentim.html

Sources:
Why We're Gloomier Than The Economy; Consumer Anxiety Outstrips the Data
Neil Irwin
Washington Post, June 18, 2008; Page A01
http://www.washingtonpost.com/wp-dyn/content/article/2008/06/17/AR2008061702463.html

FedEx Has First Loss in 11 Years; Profit to Decline 
Mary Jane Credeur   
Bloomberg, June 18 2008 
http://www.bloomberg.com/apps/news?pid=20601103&sid=aBPgROetK_Oc

Related:
Hard numbers: The economy is worse than you know
Kevin Phillips
Harper's Magazine, Sunday, April 27, 2008
http://www.tampabay.com/news/article473596.ece

~~~

Thursday, June 19, 2008 | 07:24 AM | Permalink | Comments (53) | TrackBack (1)
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Comments

I found 3 things interesting in FDX.

1. they talked a lot about demand being elastic. Consumers are trading down from express to ground.

2. trends continued to get worse after the qtr ended.

3. they currently plan to maintain service levels at the expense of margins. They can't pass all their higher costs on.

If you want to listen to a really gloomy call listen to KMX. They are the largest used car dealer in the country. CEO said the used SUV market crashed last qtr.

"During the quarter, wholesale industry prices for SUVs and trucks declined nearly 25%, which is approximately four times the normal depreciation expected over this period and well in excess of the depreciation expected over a full year. "This is the most rapid depreciation of any vehicle segment that we have experienced in our 15 years," said Folliard."

Everyone who has an SUV and a loan is underwater.

~~~
Just a nitpick but FDX didn't have an operating loss. The loss was due to writedown of Kinko's.

Posted by: Vermont Trader | Jun 19, 2008 7:55:38 AM

Though the economic/inflation/war items listed above are indeed bad, they are being brought to a spoiled and self-centered American society. It is different now than in the past. And as such, the "recession" appears to the media and those involved to be much worse than it really is.

Our grandparents, who had to pee in an outhouse or down the hall, work from morning to dark, pay cash for the medical care they needed, thought that eating out was a treat and only bought "stuff" when they had the money to do so, would laugh and have little sympathy for us today. We are a spoiled, over-weight, big house, eating out and SUV driven society. Quite frankly, living standards would need to fall a very long way before they even approached what they were just 50 years ago.

Posted by: austincompany | Jun 19, 2008 8:03:52 AM

Given the inevitable, as an investor, does it not make sense to take action now? History is fairly clear, and Barry you've made the point prior, that in protracted bear-to-sideways (at best) capital markets, investors need to carefully pick their spots and rely on tactical allocations rather than indexed choices. My query is even more fundamental, are the capital markets even reliable enough to provide opportunity for "fair" return? Are we experiencing a "Black Swan" moment in history where investment will soon be more prevalent in private deals than in public capital markets? Will investment management for the wealthy become management of multiple private equity/VC deals? Seems that with the instant access to information that we are afforded today, investors need very little "public" assistance and the growth of going "private" will become one of the few ways to succeed as an investor. How far off base am I? Help! Thanks...

Posted by: PHB | Jun 19, 2008 8:07:27 AM

Always remember:

Don't Mention the War!!!

Posted by: steveeboy | Jun 19, 2008 8:07:59 AM

The stats don't reflect the destruction that is taking place deep in the fabric of the economy. There is a substantial lag betwen anecdote and evidence.

Posted by: zell | Jun 19, 2008 8:18:12 AM

I recall an article from Salon.com, entitled "Are we falling behind our parents?" It was an interview with an author of a book about the declining fortunes of the middle class. Part of the discussion addressed the shame felt by people who cannot "keep up," and their self blame for their circumstances, because they have embraced the rehtoric of "personal responsibility." It seems to me that articles like the one Barry has cited from the Post contribute to this idea - "gee, the economy is going great guns . . . why am I having so much trouble?" Is this why there hasn't been a greater outcry from those who are suffering the most from price inflation and wage stagnation? Here's a link to the article if anyone's interested:

http://www.salon.com/mwt/feature/2008/05/14/mooney/

Posted by: KathyP | Jun 19, 2008 8:19:21 AM

IMHO your point about not writing on the headlines and failing to dig into the data is the key one. One need not appeal to problems with government indices, an objection with which I'll argue a bit. Both arguments are based on the same underlying analysis - the data has time-patterns, linkages and relationships and structural characteristics which one can see, as you've pointed out several times, and on which we should be focused. And on which the MSM and the talking heads are NOT reporting. May I suggest this review of the data and our current economic situation and outlook:
http://tinyurl.com/6saenr
As for the markets the reactions to a surprise in the Unemployment Rate tells us that no downturn is accurately priced while the surprise on the Retail Sales number tells us the outlook is both too sanguine and also NOT based on anything other than headlines - very scary and dangerous. The market is fully and accurately valued (cf the recent Barron's Roundtable) but IFF none of these economic data turn worse, as they in fact are. For the record Real Retail Sales was -1.6% yoy and ex-gasoline was -2.6% ! OUCH. All of the high-frequency data is tipping over. One needn't get excited about changes in the indicators when looking at the patterns. http://tinyurl.com/6h9kqu
Todd Harrison of Minyanville, in his inimitable style discusses these downside disconnects in his most recent MarketWatch column - recommended. Let the data speak for itself - and it's talking loudly.

Posted by: dblwyo | Jun 19, 2008 8:34:57 AM

BR: I read this piece too and rolled my eyes. The author, despite as you point out his complete economic illiteracy, is almost certainly amongst the top 10% of income earners. In fact most of the authors of opinion pieces like this are either highp paid journalists, financial operatives or opinionaters and most of them are doing a bit of moonlighting for various conservative think tanks as well. There has now been so much dicussion in the media and on blogs of the apples and oranges syndrome and indeed it's widely recognized in the financial community although they forget it sometimes. Also the main elements in public pessimism are well recognized although there's a a claque of upper middle class shills telling the middle and working class they are imagining things. So why does someone write such a load of codswallop as this and why didn't his sub editor spike it. For the answer to that you're going to have to talk to the ed board of the Post which seems to have lost almost all its scepticism since the great days of Ben Bradlee.

Posted by: John | Jun 19, 2008 8:38:05 AM

It's not enough to understand that the common person is being lied to (or spun) by The Powers That Be. We need to understand why the story being advanced does not resemble the reality we see.

The answer, as I see it, is that TPTB need to instill confidence in the public, because confidence is the essential element of of a continuing con game. (The Iraq war was the test-case for determining the willingness of the mark to participate in their own fleecing).

As soon as the mark understands what is truly happening (the they are being robbed), the jig is up, and things become very dicey and unsafe for the perpetrators of the con. The minute the mark realizes they are being or have been ripped-off, the pitchforks, shovels, torches, tar, and feathers come out. (Their reaction will be all the worse, being compounded by the embarrassment and subsequent rage of having been made fools of).

It is slowly dawning on the middle class that they are the subjects of a coordinated effort to disenfranchise them from the system they rely on for their relatively comfortable lifestyles. When the full scope of the scam is realized, the big trouble will begin.

Of course, there are willing participants in the scam (the press being the most obvious) who, for one reason or another, continue and will continue to believe that if they play along, they will get part of the booty. These are the biggest fools of all. These are the folks who will never admit to having been been raped, robbed, and left by the side of the road (despite their empty pockets, skinned knees and elbows, and all of the used condoms and KY jelly left behind as evidence).

As conditions continue to deteriorate for the common person, they'd be doing well to keep in mind that the victim of a crime is never made whole after the fact. What was stolen is gone forever. The time to protect ourselves has long since passed.

Suckers.

Posted by: Marcus Aurelius | Jun 19, 2008 8:40:19 AM

I don't believe the majority of the business press has nearly enough of a grasp on the fundamentals of economics, finance or accounting to accurately assess with a critical eye financial statements, economic data, etc. I think that budgetary constraints and deadline pressures are contributing factors to this "naivete".

Its why I read BP et al.

Posted by: bonghiteric | Jun 19, 2008 8:45:53 AM

"Are we experiencing a "Black Swan" moment in history where investment will soon be more prevalent in private deals than in public capital markets?"

I think our country in general will experience a move away from corporations and public stock markets and more toward private companies with not all information disclosed. This is a gut feeling more than anything. Think about it, private companies don't have to report quarterly numbers, report insider transactions to the SEC, make public their earnings, etc. Take Red Bull for example. It could be swimming in debt up to its eyeballs, and yet it still is marketed everywhere. We don't know, cause the company is privately owned by Austrian billionaire Dietrich Mateschitz.

Posted by: rj | Jun 19, 2008 8:55:30 AM

Will investment management for the wealthy become management of multiple private equity/VC deals?-- PHB, above

Bud, where have you been over the last decade?

you may care to review the massive growth of the PE (Private Equity)/ Hedge Fund Universe..

"How far off base am I?"

Not at all. Further, if you ask me, we're going to (have to) reverse the Charlie Merrill effect, if we're going to rebuild this Economy/Republic, or, barring that, we'll be hoping that we have the right color Coupon on the right day at the right time at the right depot..

Posted by: Mark E Hoffer | Jun 19, 2008 9:01:33 AM

Just a couple of observations:

☺☺Point 1:

Outstanding Household Debt in 1980 was $1.4 trillion. Today it is $14.0 trillion.

Domestic financial sectors in 1980 had outstanding debt of $578 billion. Today they have $15.9 trillion. I'm not sure what this figure means, but could it have something to do with a graph BP posted the other day showing financial stocks growing from only a few percentage points of the market to almost 25%?

http://www.federalreserve.gov/releases/z1/Current/z1r-2.pdf

☺☺Point 2:

I live in Mexico where the American Dollar is in free fall relative to the Mexican Peso. The Dollar has lost almost 10% of its value in the last year..

http://finance.yahoo.com/currency/convert?amt=1&from=USD&to=MXN&submit=Convert

On top of that, according to the Dallas Moring News, inflation in Mexico is currently running 4.95%.

http://www.dallasnews.com/sharedcontent/dws/news/world/mexico/stories/DN-mexicofood_19int.ART.State.Edition2.b1f822.html

Wouldn't that indicate that inflation in the U.S. is running much higher than the official numbers, perhaps as much as 12% or 15%?

Posted by: DownSouth | Jun 19, 2008 9:01:48 AM

Economic statistics are every bit as political tool as a they are a pure reflection of what they are intended to measure. When the measurement moves outside acceptance range of political purpose, the formula is "adjusted". Always under the cover story that the old formula too dated and does not reflect current economic processes of course. Those whom report on these figures just go with the figures. Many out of time constraints or sheer laziness do not delve into intricacies of adjusting for historical comparative integrity, rather they crank out verbatim what is reported or simply as a fail-safe in the event they are challenged on their "covert" purpose of making more salient needed adjustments for more clarity. Politics, eEconomic data, journalism, is every bit tied to it.

Posted by: Stuart | Jun 19, 2008 9:12:26 AM

And it's going to get worse at the rate of a Chinese Water Torture until the commodity bubble is burst.

The WSJ buried a piece at the end of a section today about how long only commodity index funds contribute to the commodity bubble. I won't pretend to understand how they work except for some points the story mentioned.

Since they are long only and since huge volumes of money are pouring into them, there is nobody taking the short side. Thus, the only risk of loss is from the index fund falling like any other mutual fund. While I suspect the liars would claim the funds are only following the price of oil, I suspect it is a case of the tail wagging the dog in some complicated interaction. This needs to change.

Also, I suspect some in the shadows at ICE are up to no good in some way not being properly supervised. Plus, the large investment houses are unregulated in how much money they can pour into commodities, unlike individual investors. Thus, when GS says oil is going up, they have the money to prove it.

Thank the media for explaining all this using the path of least resistance. "Hmm, oil is going up and a book says peak oil is coming. Maybe it's here now?" And thus, the cycle of stupidity continues as sheep believe it is true because it's on the internet or in the newspaper.

Thank the CFTC and other regulators for keeping their assholes clean by making regular thumb insertions. Hygiene is good, but they are nearly useless.

Congress apparently created this mess back in 2000 by passing a commodity oriented law that made this type of trading activity just peachy. This is a different law from the Enron Loophole that is said to be closing soon. When will these congenital retards fix the problem by passing remedial legislation for the loopholes opened and to close the newly created ones that benefit only a few at the expense of the greater society?

Like I said, I'm not an expert but I think I hit most of the important points well enough for horse shoes. While a few are making money by gaming the commodity markets, it is at the expense of 98.5% of the rest of the population. The only price finding mechanism in play is how much each memo can 'roll the market forward', to use a commodity term and probably make a factual statement on several levels. The other commodities are just along for the ride.

Posted by: cinefoz | Jun 19, 2008 9:19:43 AM

I would tend to say that as a whole, we are far too OPTIMISTIC. For example, did anyone see Tobias Levkovich (chief equity strategist for Citi) on CNBC today? He basically said about conditions causing high oil and commodity prices (floods, drought in Australia, etc.): "These are distortions in markets, these are not real." I had to rewind 2-3 times to make sure I wasn't hallucinating.

WTF? That's like saying World War II was merely a market externality. I guess the issue with most analysts is that they always say that things will get back to 'normal' assuming that the most recent period is 'normal,' never acknowledging that perhaps the recent period was very very abnormal. I believe (unfortunately) that cheap food, cheap fuel, and easy money are the exception rather than the rule: We are on our way back to "normal" right now, not the other way around.

Posted by: HCF | Jun 19, 2008 9:27:39 AM

reinforcing downsouth comment.

inflation in india as per official measurement is around 7.5-9%.

but indian currency has gone up around 15% in the last 3-4 years.

but i dont think its only because of inflation......i think it is correction of the imbalances built over the last 10-15 years.

cost of living to income is still much better in usa than india/australia/norway etc..

I being a DINK...living in rental...able to save 40% of my income....if i max out 401k....i may be able to save 50%.

we drive old cars...old furnitures....dont eat out much.....kind of boring life...but it looks like early retirement is not just a day dream.

Posted by: techy | Jun 19, 2008 9:29:24 AM

Many of the underlying problems have yet to be addressed in major publications. They are key players in the ad game business and consumer spending is positively correlated with feeling good.

Posted by: Jack | Jun 19, 2008 9:44:07 AM

techy:

Maybe I am overpessimistic about the use of acronyms. Are you a turkish journalist, midget wrestler or character on Nickelodeon? :) (Google DINK)

Maybe I'm just old and out of touch...and grouchy this morning. In any case, don't keep all that 401k in dollar assets or even long right now.

BTW, good rant over here about Goldman's new employment, or rather disemployment, program:
http://epicureandealmaker.blogspot.com/2008/06/overheard-at-85-broad-street.html

Posted by: Mike in NOLA | Jun 19, 2008 9:59:36 AM

Barry, the problems with mainstream "professional journalism" are obvious enough with respect to business reporting, but unfortunately the problem doesn't begin and end there. The same abysmal quality of "journalism" afflicts the reporting in virtually every other topic, especially in politics and current events. If I had a dollar for every time I've read or heard a witless, inane, credulous, naive, or spectacularly misinformed statement by an alleged mainstream "professional journalist" over the last 15 years I could take my family on a long vacation. In particular, it's become obvious that the vast majority of mainstream "professional journalists" regard the internet as little more than a source of cheap airline tickets and porn, and have no clue whatsoever that there is, among all the crap, a tremendous amount of valuable and accurate information about the real world published by informed bona-fide professionals in their fields, of which BP is a shining example. Even the smallest amount of effort by these alleged "journalists" would open up worlds that they appear to be completely ignorant of, and the only obvious conclusion is that the vast majority of these "journalists" are lazy, complacent, and arrogant individuals who are more concerned about happy hour at 5pm than they are about actually doing the hard investigative work that informs them and their readers. There's no doubt that the hours and hours you, Tanta and CR, Mish, the Minyanville folks, just to name a few, would literally be unimaginable to the lazy "journalists" who go through the motions for the mainstream print and broadcast media each day.

I would bet that the prime sources of the problem are the journalism schools in this country. They must have watered down their admissions standards and academic guidelines so thoroughly that graduates honestly believe that a journalist's role is to dutifully transcribe what is told to them without question, and to regurgitate it back to the public, with a big happy smile. Stenography could not be a more apt term.

If you want a very recent example of how low the field of "professional journalism" has fallen, the National Press Club yesterday saw fit to rent its facilities out to convicted criminal and moron Larry Sinclair, who's been desperately trying to peddle a pathetic tale of drug and sexual escapades involving Obama for months. The fact that Sinclair has well over 20 convictions for a variety of criminal offenses and has changed the details of his lurid tales repeatedly didn't make any difference to the NPC. The comical ending of the press conference was the topper, as Sinclair was arrested on an outstanding warrant by the state of Delaware.

Not only that, but the NPC also allows Jeff Gannon, the former male prostitute and fake White House press corps "journalist" who Bush and other administration officials would call on for softball questions, to maintain a personal blog under the NPC banner. When a "professional" association supposedly devoted to maintaining standards of "professional" integrity and credibility gives frauds like Sinclair and Gannon a platform, that's all the indication you need that the "profession" as a whole is thoroughly corrupt and rotten. I know there are exceptions, but that's the problem: they're exceptions, not the rule.

Posted by: bluestatedon | Jun 19, 2008 10:01:21 AM

I'm very pessimistic for many reasons. (1) How will our levels of government pay for the $53+ trillion dollars promised to various constituents via Medicare, Social Security, pensions, etc. Will the temptation to hypertax & (hyper)inflate away this debt prove too strong? How will we reconcile the promises & fact that the money is not there? (2) Our federal government will not change its awful spending habits until (I guess) it can't borrow money anymore. I don't see the fundamental change in attitudes necessary in our leadership to change this. (3) Cheney & Bush have bogged us down in wars that have no end in sight. (4) I don't see how the dollar can stop losing value given our empire of debt. (5) In summary, this country borrows too much & passes the bill onto future generations & the responsible savers. There's not armed rebellion yet because not enough people have been presented with a bill & payment demanded. It makes me wonder if I should learn to repatriate capital & pick a country to move to when things get a lot worse; which language should my family learn?

The bright side of this is that much of our nation is slowly learning how or being forced to consume less, which is good for our pocketbooks & environment. If we have a broken fiscal system, then we are moving towards to a breakdown & hopefully it can be restructured in a simpler & smarter way.

Good luck to all of you,

Ben

Posted by: Ben H | Jun 19, 2008 10:03:11 AM

Housing is locked on it's glide path into a mountain of debt. Get up in the A.M. to se oil in the $130's and that's al you ned to know.

Posted by: zell | Jun 19, 2008 10:03:23 AM

The difference in sentiment between today and the early 80's is that by the late 70's/early 80's, things had gotten so bad that the depths of despair had been already reached. America was on her knees politically, militarily and economically. The dollar was in free fall internationally and domestically. OPEC had seemingly limitless power to manipulate the price and supply of the blood of the economy. A bunch of rag-tag Iranian students had attacked sovereign US soil (the US Embassy in Tehran) and taken hostages, and it seemed there was nothing we could do about it. A feckless rescue operation seemed to cement our impotence. And not least, the Soviet Union was ascendant, so much so that invasion of Afghanistan seemed a good idea. High oil prices masked the Soviet Union's utterly broken and fraudulent command economy, but that was hard to see at the time. The US was reeling.

Once we hit bottom with the failed Iran rescue effort, with vivid images playing on TV of burned-out hulks of US helicopters lying in the Persian desert, it seemed grit and optimism were all the choices we had left. The mood started turning with an ice hockey championship over the Soviet Union, which, symbolically at least, showed that perhaps America was not quite yet through. People began to believe that things might get better, if only because it would be hard for them to get worse. Beating the Soviets gave credence to their beliefs.

Shortly afterward, the real economic bottom was reached, and then began an amazing run of economic, political and military superiority never before seen in human history, culminating in an America poised at the very top of the precipice of human affairs. There were only two very mild economic hiccups along the way that temporarily stalled things. Elsewise, it was a more or less straight shot up.

Unfortunately, from the top, all roads lead down. This, I think, explains the paradox of pessimism and despair even while things are still very, very good. People have come around to the notion that the age of American hegemony is drawing nigh, and life is always more satisfying and meaningful on the way up than it is on the way down. How far we might fall is the question striking fear in the hearts of Americans, and they know there is no easy answer. This has only just begun.

Posted by: DonKei | Jun 19, 2008 10:04:58 AM

MSM today are not schooled in anything other than stenography. It's all about getting the headline and the scoop. Yesterday in the NYT it was noted that it's Broadway scribe was going to Iraq to report on the war. Weird.

Posted by: grumpyoldvet | Jun 19, 2008 10:08:58 AM

Perhaps someone can help me with a few questions...

1. If the press is naive, and I agree with that assessment, then what good can it do to consume their information, especially if we know it is, at best, misguided, and it often results in our own frustration?

2. If the press has any effect on investor psychology, then could a trader not take advantage of that disconnect with reality? If so, we should cheer the press' naivete, not jeer it, or at least be indifferent to it or even be entertained by it.

3. Assuming broad market movements are significantly affected by investor sentiment and psychology, especially in the short-term, rather than fundamentals, does this not make the quantitative data essentially useless?

4. Once we prove the press and the feds are idiots, which I applaud Barry's talent in doing this, and their respective spin and data are mis-reported and innacurate, what does one do with that information?

5. If the answer to #4 is to find the disconnect and leverage our "good information" against their "bad information," then shouldn't a trader wish for more idiots to spin an even greater disconnect?

Thanks, in advance, for any help with my questions...

Posted by: The Financial Philosopher | Jun 19, 2008 10:13:17 AM

December 2008

Sun	Mon	Tue	Wed	Thu	Fri	Sat
	1	2	3	4	5	6
7	8	9	10	11	12	13
14	15	16	17	18	19	20
21	22	23	24	25	26	27
28	29	30	31