It has been a while since I last wrote in this blog. Maybe it was depression over the economy and my retirement and Rama or maybe just a whirlwind of unproductive activity. At home a beautiful garden was created and then eaten by the deer. At dance my shoulder posture wasn't good and righting it caused pain. My fox didn't trot and my two step was only 1.5. But it is fall again and time to reassess before the coming winter.
In the bathtub this morning I read yesterday's Financial Times. The Wall Street Journal pulled a fast one and near doubled my subscription cost - without notice to me, at least one that ever reached me, so I pulled the plug on WSJ - at least for a while in absolute irrational revenge mode. Me against Rupert?? Don't even think about it.
So what made me want to write? In the FT for Friday August 14, 2009 there were several articles of note. Robert Gates, Secretary of Defense, says that one day the war in Afghanistan will be over. Ho Hum! However, on the Editorial page there is a letter from Todd Roberson of the Indiana Univerity Department of Economics. He makes the case for Obama having only one term. Pretty gutsy of a London based financial paper to publish that one. On the next page George Magnus of UBS describes how to release the next boom. Well, let me tell you, I just got back from Indiana and the boom hasn't started yet. The road from Cincinnati (I-74) looks like a Mad Max at the Thunderdome set and is full of potholes and cracked cement. At the Shelbyville shopping center the only activity was a few shoppers at Walmart and all the kids who should have been employed were hanging out at Starbucks idly talking about nothing important. Maybe we are going to continue stimulus packages until the currency becomes so diluted that even a shot of watered down Half and Half won't make a latte substitute.
However, on pages 050-051 of this week's Business Week magazine (sort of like saying today's USAToday) there are charts which if interpreted correctly seem to indicate that investor sentiment has doubled its optimism since March 2009 and that the CBOE VIX indicator has fallen (that's optimistic, the lower the VIX the more stable the markets) and the stock market has had 5 weeks of really strong upswing.
More importantly, however, I think, is Dan Ariely's piece on page 049 of BusinessWeek - "The Curious Paradox of "Optimism Bias." He argues that if we get a little giddy with optimism, then we will be more likely to take the risks necessary to make our economy grow again. Dan, I am just not getting it. Wasn't it irrational exuberance that got us into this mess? Do you think that Mom and her spouse Joe Dinnerbucket want to bet the last shreds of their life savings again? We aren't going to start spending/buying again for some time - maybe ever. I think we learned our lesson.
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Saturday, August 15, 2009
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1 comment:
I hope you are getting over some of the intense meloncholy or pessimism that was self-evident in your post.
It may well be that the boomers are done spending. I probably would be. Ah...but for someone in a stable (an ephermeral sort of "stable" to be sure) situation with time on their side? Why wouldn't I stretch --RIGHT NOW--? Real estate, equities, heck even get that couch we always wanted since the dealer can't give them away most days.
Where is the balance? Can't we believe that things will be better and plan for that too? Are you saying the America we know is over? Or is it just those things that 95% of us never had and knew to be unsustainable will take a back seat to more rational ways of producing, living, and loving?
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