I will be doing a couple of updates this week. With Thursday being Christmas Eve Day, I can only advise all of you to trade as little as possible. There may be some action on the opens and the closes, but all in all, I would avoid these markets.
That being said, there are historical tendencies for stocks to rally. Even the clerk at the 7-11 has heard of the Santa Clause Rally, so beware being short this week.
Try as they might, the analysts and commentators on the cable business shows are going to fail to find interesting things to talk about. There really is nothing on the horizon until the first Friday in January. Then we’ll get the fresh unemployment numbers.
One interesting note, which may be the early signs the bottom, or at least a flimsy imitation of a bottom made of plywood and super glue, may in fact be in place. I base this fact solely on the amount of bearish news stories I have seen this month.
Capped off tonight with a very sad, “60 Minutes” story about Wilmington, Ohio. It was a follow up story, from Christmas 2008, when DHL went out of business, and laid off 10,000 people. In a town with only one industry, you can imagine the horrendous effects that has had.
Of course last year, the lay offs were fresh, and people were hopeful that the government aid plan proposed by the President would have the desired affects and save the town.
A year later, and from all I could see, there was only more bad news there. The reporter interviewed quite a few people, and did not talk about any positive stories, could not find any stories of re-birth.
True to form, the piece was negative. Seems that nothing glues viewers to their flat screens like bad news.
Overall, just a depressing, heart wrenching story of countless lives being turned upside down and inside out.
It made me think of the cliche, when a reporter runs up to a man who’s house just burned down. A man who just found out his whole family burned to death, and then the reporter sticks the microphone in the man’s face and asks , “How are you feeling?”.. But I guess that’s journalism…. And they called Economics, “the dismal science”. I am starting to believe that Television Journalism, is in fact, “the dismal vocation”.
My point in even mentioning this story is this. Usually, when the media is beating a story to death on a regular basis, its usually a sign that the ‘story’ has almost run its course. So, in effect, the media is a giant fade.
Now we have media stories looking for 1) the double dip recession, 2) the fact that Goldman Sachs an BOA stocks have once again turned south, and 3) more and more stories about “the real” unemployment rate being 17 percent. We have the media, more bearish and pessimistic than usual, in other words.
In fact, they are on the verge of flipping on President Obama. Six months from now, you may not be able to tell the difference between CNN, National Public Radio and Fox TV… They may all be furious with the President by then.
Personally, I find that refreshing and cause for a pause. These media people were the exact same ones 2-1/2 years ago doing stories about ‘the property ladder” and investors flipping houses on their way to being millionaires. Now those programs have been replaced with a series about 1) people renting and 2) a new reality show about a pawn shop called Pawn Stars. If that’s not a complete 180 degree flip, I don’t know what is…I want them to bring back the show about the guy in Charleston, South Carolina flying around in his helicopter, buying houses for 30 k and selling them for 300K…
So, all in all, the more negative stories we have over the next few months, the better. What we need to really signal that a recovery is for real is a couple of juicy covers on Time or Newsweek. Something along the line of “The Death of the American Dream” or “The End of Growth?” or my personal favorite, “Is it time to leave the US for greener pastures?”.. When the best and the brightest throw in the towel, you can be sure America will be already on its way back to economic vibrancy.
