Here I go again, patting myself on the back. But then again, if I don’t, will you? Just a few blogs ago (October 9), I predicted that gas prices would be under $3.00 by month end. Well, I pumped gas at $2.99 yesterday.
Some acquaintances laughed at my prediction as well as the rationale that this was caused by speculators fleeing the market. So let me explain.
Even though government has thrown money into bailing out all these financial institutions, the stock market is still behaving like a drunken and unpredictable fool. Well, there is nothing unpredictable about it. At the end of this ‘crisis’, we will have several hundred new millionaires. If I had extra cash I would be doing the same.
When Washington Mutual went down, the shares immediately dropped. But as soon as Chase acquired it, shares went to $44.00. If you bought at $2, then you can calculate your great gains. Well, that is exactly what is happening. Speculators are holding onto their money waiting for quick buys. They are trying to gauge when is the best time to buy as against holding out longer. And this is why the market is so topsy-turvy.
It is no longer about confidence, it’s about gambling. Here’s how it works using oil as a sample. Despite all the crap about demand and supply, gas reached $4.00 simply because of speculation. It has dropped spectacularly even though in places like Atlanta, there is a shortage. Thus the price should rise according to the holy book of capitalism, right? Wrong!
Speculators have pulled their money for any of at least 3 reasons. One is that they are scared and moved the money in to metals like gold. Another is that they are waiting for better opportunities ala WaMu. The third is that they are waiting for better opportunities ala oil.
Lets say I had 100,000 shares of gas at $4.00 per share =$400,000 (if wishes were horses, I would be flying). The price starts dropping and at $3.80, I go, ‘Uhho, I better get out of here’. But if I’m smart, I hold unto my cash and watch the drop. Right now, I have $380,000 safe.
The market hits $3.00 and I still hold. Then somewhere I guess that it might be moving up soon. It might even start reversing by the time it reaches $2.60. That $380,000 will buy many more shares than I previously held. I jump in and wham, I’m much richer now than before. It climbs back to $4.00 (simply on speculation), and Paris Hilton’s ordering us (me and she fool, you are still poor) breakfast in bed.
Watch what happens when the market starts to pick up. It will do so fast. This is the reason for the small spurts. Moneybags are feeling things out. It moves up a little, speculators jump in, the market rallies more. But many still hold, shortening the rally and the next day, the market drops again. Until.
So if there’s anyone out there who wants to give me $1/2mK, feel free to do so, anytime soon.
But hey, there are several downsides… though that I haven’t fully figured out the specifics as yet. But this much I know. It’s going to be like the economy on steroids. Some are going to be filthy rich fast, others are gonna get screwed mightily. And when you throw an overdose of steroids into a body, it breaks down pretty painfully. The economy will crash worse, it’s a matter of time. Capitalism eats itself from the insides. And we the hoi polloi are the insides.
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Man who fight with wife all day, get no piece at night.
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Ok, so the market has hurt you. Your 401K is now 101K. All the experts have been proved wrong. What do you do with the little savings you have left? Well, let me recommend a new money management firm, al Qaeda.
Yes, you got it right. Al Qaeda. According to some experts, al Qaeda ‘… is likely to escape the effects of the global crisis’.
“A mobile and extensive military options unit with its fingers in non-western banks and money transfers, backed heavily by pharmaceutical funds, this stock is expected to rise as its main rivals which it continues to out-maneuver, go broke. Outlook for 2009, pretty good, stock rating high. Buy now”.
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Voting connivances
The recent history of voter fraud ‘allegedly’ committed by the republican party is, well, spectacular even by Jamaican standards. But there are more than 1 way to skin a cat, and currently one of the ways is the ‘systematic purging’ of the voting rolls so late in the campaign by the McCainanites, particularly in close states.
It’s clear that they have designed not to purge THEIR potential votes but democratic votes. Much of this purging is happening to blacks and Hispanic immigrants. And it’s quite clear that many innocent citizens (particularly those of ‘democratic suasion’) will be expunged. By the time the mistake is found and corrected, it will be ‘So velly solly we make beeeg mistake’… but the damage will be done.
This is why all legal voters supporting the Obama campaign need to turn out and make their voices heard at the polls. This is no time for complacency.
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One sunny day in 2009 an old man approached the White House from across Pennsylvania Avenue, where he’d been sitting on a park bench. He spoke to the U.S. Marine standing guard and said, ‘I would like to go in and meet with President Bush.’
The Marine looked at the man and said, ‘Sir, Mr. Bush is no longer president and no longer resides here.’. The old man said, ‘Okay’ and walked away.
The following day, the same man approached the White House and said to the same Marine, ‘I would like to go in and meet with President Bush.’
The Marine again told the man, ‘Sir, as I said yesterday, Mr. Bush is no longer president and no longer resides here.’. The man thanked him and, again, just walked away.
The third day, the same man approached made the very same request of the very same U.S. Marine, who understandably agitated at this point, looked at the man and said, ‘Sir, this is the third day in a row you have been here asking to speak to Mr. Bush. I’ve told you already that Mr. Bush is no longer the president and no longer resides here. Don’t you understand?’
The old man looked at the Marine and said, ‘Oh, I understand. I just love hearing it.’
The Marine snapped to attention, saluted, and said, ‘See you tomorrow.’.
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