Today was another down day on Wall Street. Yesterday, Ben Bernanke and the Federal Reserve reported a stern, nay, grim forecast for the economy in the near future. Wall Street reacted as expected and fell sharply from the opening bell and continued to decline throughout the day. By the end of the day, the Dow was down almost 400 points. I found this scenario particularly unsettling on a number of fronts. First, I lose money on days like today. My 401K declines in value. Second, this type of market behavior signals a fundamental weakness in the economy that has for many other Americans, much more immediate, real world implications. I know them, you know them too, and maybe you are one of them.
Mid-morning, into to this day’s settling gloom marched the Perma-Bear. I think that he lives for these down days. He certainly seems to enjoy them, although he denies this. I suspect that he is shorting America again, and consequently is making money on days like today. In the past, I’ve accused him of schadenfreude, but I don’t think that this is really fair, appearances aside. In 2008, when I first started working with him regularly, he was reading a history of the Great Depression during his lunch, sanguine reading to be sure, but by the fall of 2008, much more topical. My 401K got hammered back then, but eventually it bounced back, mostly. The hard financial lesson of 2008, combined with the instructions of the Perma-Bear, did teach me to closely monitor my investments. My days of buy and hold are gone.
I still cannot buy-in to the Perma-Bear’s déjà vu all over again view of our economy. I still refer to this economic turmoil as the Great Recession, and not the Great Depression II. George Santayana is often quoted or paraphrased, “Those who cannot remember the past are condemned to repeat it.” I believe Bernanke, Obama and the rest have also read similar Depression histories. They are all intelligent men, like the Perma-Bear is. They maybe wrong and he maybe right, but my money is on them. To this end, the Perma-Bear this month slapped a post-it note on my cubicle wall. He metaphorically threw down his gauntlet. A year from now, we will do a reckoning. I pray to God that the Perma-Bear is wrong and our economy is on the mend..
In line with this rather bleak post, the Sheldon was our last stop on last Saturday’s Fiber Crawl. In addition to the fiber arts exhibit there, in the adjoining AT&T Children’s Arts Gallery, there was another new art show. This exhibit included both writings and visual art forms. The title of this show is, “Lessons of the Past … Promises for the Future”. Its theme is the Holocaust. Josh Keen’s painting, “Loss of Innocence”, pictured above, is the signature art piece for this show. I found Mr. Keen’s art work to be both powerful and moving. His age only amplifies these feelings and makes this piece even more haunting.
While much of this post discusses the PermaBear, today, I got an email from the PermaBull. He sent along this link to a business article. In the stock market, the old adage, what goes up, must come down is turned on its head. The new paradigm is what went down will rebound.