Wednesday, April 15, 2009

"Forget It, Jake. It's Chinatown"

A dip back into real-world waters.

It's always odd to be in and out of the moment. When I was on the CBOE trading floor in October 1987, there was nobody saying, "This is a buying opportunity." There was just chaos and fear. Once the market rebounded, everyone was a genius. "I knew that was the bottom." Yeah, right.

With the market staging an impressive rally in these last weeks, it is clearly a head fake that most people are ignoring. CBS Marketwatch headline at the end of March cited the biggest rally since 1933. I had forgotten that that was the exact moment the Depression ended. No, wait, it got worse from there. As if that banner wasn't enough to make you sell, then the story below the imaginary fold, that people should consider cashing out retirement money (or what's left of it) to buy real estate, should be enough to scream "Get out of the market."

So, what will I do. Nothing. I'm not going to sell out my 15% exposure to the market even though everything tells me I should. I'll wait until the end of summer, when the market is back down and say, "Check out my post on April 15, I knew it was the top."

All of that gets me to Obama. He's fine, threading the needle on optimism and skepticism, which is the same as taking no position at all. In the long run, the "stress tests" which are shams will mean nothing for the walking dead among the banks. The structured bankruptcy of GM, so abhorrent a few months back when we lent them billions, is now seen as optimal. There's no real guiding principle there.

There is a guiding principle in Obama's stand on state secrets and wiretapping. That principle is that expanded executive power, even unconstitutionally so, is only bad when an opponent or an idiot is wielding it. That Obama is carrying on Bush/Cheney's imperial presidency in these areas is horrific, especially when dispensed by a constitutional scholar. At least W. was a moron. Obama is supposed to know better. And don't get me started on the lack of prosecution of torture culprits. Frank Gaffney, Republican stooge, pointed out the difference between American officials "doing their jobs" and Nuremberg Nazis who were "following orders." Do you see that difference? Waiting...waiting... That's because THERE IS NO DIFFERENCE. That the new administration, this beacon of light and justice, is consciously stiff arming the law of the land is tragic.

But, what are you gonna do? This happens all the time. Either Washington corrupts, or the corrupt are drawn to D.C. Either way, there's nothing to do about it. After all, it's just Chinatown.

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