Okay, so I am sitting here at my gate waiting to board the next flight to London, take a brief rest, and then hop on the next flight to Barcelona. Getting here could not have been smoother, as when I walked into the SFO airport, the place echoed. Nobody was in that huge cavernous room, and just like that, I was through check-in and security and am now sitting here. Gotta love it.
So the market is still acting in measured steps. The Greek deal today did little to excite the market. I still think we have to wait until the EU economic accord and the ECB “liquidity pump” happen on or before March 1. If all goes well then, it is possible, and maybe probable, that the market will react kindly to the news that the contagion is contained, and that the time bought will allow for a possible, long-term solution to the fiscal mess we call Europe. But before we think about that, here is a provocative question from a TE reader …
Did you build that small ranch on the beautiful California coast? Or did you buy it? And if you bought it, did you squeeze the sellers on the sales price to your advantage. And was that a noble gesture on your part? That’s just the market in action, right?
I could be wrong, but my thought is this reader is suggesting my column on nobility, choosing the right thing for the benefit of all rather than just one’s self is, perhaps, a bit ‘o blowing some wispy smoke. Well, I will respond to that suggestion, and if I am wrong, I do so apologize.
Whether it be real estate, or anything else, I adhere strictly to the notion we all have an obligation to our communities, as well as to ourselves. I believe in the concept of enlightened self-interest, which suggests that by serving others, we serve ourselves. When I buy real estate, for example, I negotiate, but I do not “squeeze.” I do not look for the angle, or the way to “better” my opposite in the transaction. I go for the “fair” price, not necessarily the “best” price. This approach serves my best interest because there is only one face staring back in my mirror. In my eyes, it is in my self-interest to feel good about me, and this in turn serves the community at large because there is one less person out there trying to take advantage, trying to gain at another’s expense.
As to the idea that “squeezing” is “just the market in action,” well, I have a word or two on that as well … A market is a manmade system; we humans define it and its rules. This is a bit different than, say, the natural movement of planets around the sun. We can explain that movement, but we cannot define it nor mandate its rules. Thus, to suggest that everything that happens in a market is okay because it is just that market doing its thing is like saying it is okay for inner-city gangs to sell crack because it is just “the gangs in action, right?”
Now in this ideal market world, the reader implies it is fair to “work the angles” to get the best deal, even if it means “squeezing” the other party. I disagree, and since we make the rules, how about we make one that says all parties in any market transaction are required to serve their enlightened self-interest, which means they strive for the fairest deal for all, meaning, in the end, all walk away feeling as if each got what they wanted. After all, this is how the equity market operates. You buy or sell on the bid/ask price only, a fair price determined from buyer/seller interest, nothing more … Oh wait! In that manmade system we now have algorithmic trading, high-frequency trading, wealthy speculators cornering markets, insider trading, pump an dump, dark pools, naked short selling, fraudulent accounting, and always and forever, traders trying to find that elusive edge, no matter the cost to others, or, in some cases, themselves. Now what?
Trade in the day – Invest in your life …
