Guest Post: If Not Trusting This Market Makes Me An Idiot, Then Call Me Crazy!

Tyler Durden's picture




 

Submitted by Mark St. Cyr

If Not Trusting This Market Makes Me An Idiot: Then Call Me Crazy!

I was left slack-jawed as I listened to an interview on financial media between the host and guest. I have always enjoyed as well as respected the host even though many times I may totally disagree. However, as for the guest being interviewed, not only did I disagree: I lost quite a bit of respect for.

During the interview the questions were posed as to why people (investors et al) harbor these feelings of angst as to whether or not they should get in, get out, etc,, etc. The guest then went on to use data points, math, trend references, and any other metric available within a snake oil sales bag as to prove his point: Where people not believing in this market rally along with those who’ve not participated are, (and I quote) “Idiots.”

I have only one answer to that statement: What you’ve just demonstrated is exactly why people with more than half a brain aren’t buying your message: You are insulting their/our intelligence.

Over and over again data samples were used as to fortify the argument why it is not only perfectly logical to be at heights never before seen in the history of the financial markets, but we’re here based on the sound argument of earnings and profits. (right here I nearly lost my coffee!)

So good are these earnings it was noted, “The analysts had to revise their numbers up!” This was stated as ipso facto the financial markets are ready to power on even higher.

I’m sorry, but I’m a businessman, not a “Wall Street-er.” And I know first hand: Data points, trend-lines, projections, extrapolations, and more can be made to look and sound more in line with watching a fairytale presentation about unicorns and rainbows. Add to this from actual experience and knowledge most don’t (or wont) stand up to the first truly hard reality based objective analysis poked anywhere deeper than superficial presentations and analysis.

When asked to define who constitutes the “Idiots,” the reply came back (I’m paraphrasing but not by much if at all) “The people who are giving into their worst human instincts allowing their emotions to control their perspectives and attitudes their comments and their portfolio are ignoring the data.”

No, we are not ignoring the data. We understand the what, where, and how the data that you are providing as proof positive is being created and cherry picked.

What’s glaringly obvious to anyone with any common sense is that all the data as to back up the position by the so-called “smart crowd” that it isn’t the Federal Reserve’s intervention moving this market willfully omits: None of their historic data contains the Fed., its direct intervention of balance sheet purchasing within the markets of today! I mean seriously – we’re the “idiots?”

What’s being completely ignored via the data is that you believe we are idiots for knowing the difference. It would seem we as investors, business people, entrepreneurs, mom or pops are looked upon as just not being able to understand fairy tales and fables. The issue for Wall Street is many of us are a lot smarter than they give us credit for.

I know it’s only in a Wall Street brokers office where I’ll be shown reason after reason why I should invest my money in their newest (ridiculous) scheme. For again, only on Wall Street can the case be made (with a straight face): “This company is now selling dollar bills at 99 cents. However, with improved efficiencies, synergies, a workforce downsizing and more: they’ll be able to offer even more of a discount creating even more top line growth. Currently using GAAP accounting, sure they’re running at a loss, but via their new accounting firm and restructuring their Non-GAAP earning shows them making money hand over fist next quarter! This company is destined to be the hottest thing since ________(add last greatest bankruptcy here) Just look at this chart! But you need to take the long-term approach here, you need to ride the waves, so don’t look to pull out at the first sign of trouble, as a matter of fact: that’s when you should buy more!” And I’m the one who’s an idiot?

Getting back to why we’re crazy for not buying in (especially at the highest level the markets have ever been in the history of mankind) to this financially engineered market can be precisely correlated to the very people who are in charge of it!

Speeches and more pointing to “over confidence” have been coming straight from some of the very people who are themselves Federal Reserve Bankers. (You know, the very people in charge of providing all this juice!)

Many are both publicly stating or eluding too in no uncertain terms that it is the very people telling others such as myself we’re “idiots” that are acting, talking, suggesting, and making recommendations with total abandonment and self-directed obliviousness to the potential dangers within the markets themselves.

Let’s just highlight for example why people like myself who the so-called “smart crowd” refer to as “idiots” won’t invest in the markets as they currently are.

First: Any (and I mean any) so-called “financial expert” that can sit there with a straight face and use metrics from one time period while glossing over the glaringly obvious that most of those very same metrics have been completely adulterated, and are representative in name only of what they first reported.

If an “expert” wants to defend how today’s unemployment headline number is comparable in representation for what it was in all the charting periods they want to hang their hats on as proof positive employment is getting healthy – I have some ocean front property in Kentucky I would love to sell you. Or, better yet – for you to “invest” in.

Next: If the markets at present heights are representative of a “healthy” economy and not a product of the Fed.’s intervention (Aren’t financial markets supposedly a form and representative of economic health?): Then why in the world can’t the Federal Reserve not only end all the forms of QE currently in the markets, but end them early? (Oh the humanity!!!)

Why can’t the Fed. right now announce it is stopping all its programs, give dates as to when so the market knows, begin immediately to reduce its balance sheet, and raise interest rates say by some staggering amount of let’s say 1/2 of 1%? That would bring us up to (wait for it….) 1%!

Everyone knows the reason why: It can’t or the markets would freak out – and everyone on Wall Street knows it.

It’s in that statement above where the crux of all us “idiots” issues lie with the so-called “smart crowd.” If it can’t be done, that alone proves ipso facto that all the facts, figures, trend lines, charts, sentiment, blah, blah, blah that are thrown at us to muddy true objective analysis are worthless. Period.

We have never had this type of interventionist monetary policy actively participating within the capital markets. So much so that again I’ll state: Some of the very people responsible for it (at the Federal Reserve itself) are calling for the manning and lighting of the signal fires for caution.

There is nothing wrong with someone turning from a bearish posture to a bullish posture as far as market positioning for the reasons that: They’ve been wrong – for all the right reasons.

There are those times where educated and savvy investors and individuals can and will put money to work where they need to hold their nose. The difference is: if it all blows up, we’re adults, we understand, we knew the risks and can live with the consequences. We might not agree on everything, but it’s a pragmatic use of both money and investment guidance that’s truthful. e.g., Hugh Hendry’s flip in market position and candid explanation.

Again, I may not agree with everything he might espouse, but if everything blew up and went to zero, my door and checkbook would remain open if he were looking to start again. The people who seem to disparage my thinking as an “idiot” for not trusting their view? I’ve never taken such pride or felt as smart in being called an “idiot.”

It is absolutely unimaginable to me as one who has both ran businesses as well as started them to hear someone who’s income is derived from the very customers they need to refer to them as: “Idiots.”

In business that is absolutely the worst of all sins. Again to blatantly, unabashedly, disparage, and demean the very people needed to make both the markets stronger as well as grow their own business: I can’t put into words how utterly foolish and stupid it sounded.

If not listening, let alone putting my money to work in the hands of the likes of these people makes me an idiot? Than sign me up for the crazy train: For listening to this trite has become an exercise in futility. Or better yet – idiocy.

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Sun, 08/17/2014 - 16:09 | 5105893 ParkAveFlasher
ParkAveFlasher's picture

"The market" is a controlled, redistributive mechanism for managed reallocation of both credit and wealth.  Surprise, slave!  You're on Captive Camera!

Sun, 08/17/2014 - 16:21 | 5105930 Keyser
Keyser's picture

If you are in a card game for 5 minutes and haven't figured out who the mark is, guess what...

Sun, 08/17/2014 - 16:28 | 5105950 Leonardo Fibonacci2
Leonardo Fibonacci2's picture

ok ok you wanna be called an idiot?  IDIOT

Sun, 08/17/2014 - 18:13 | 5106281 max2205
max2205's picture

BTFD

Sun, 08/17/2014 - 21:07 | 5106686 0b1knob
0b1knob's picture

< He's crazy.

< He's an idiot.

 

Sun, 08/17/2014 - 16:36 | 5105976 El Oregonian
El Oregonian's picture

Yea, and when it all comes crashing down you can bet the "Snake oil salesman" will silently slither away in his yacht heading to the Cayman's under the cover of night...

You know, some of us might be idiots but that is better than a lyin' boot-licker such as yourself.

Sun, 08/17/2014 - 17:22 | 5106107 Harbanger
Harbanger's picture

If you ain't prepped for a downturn by now, you never will be.

Sun, 08/17/2014 - 19:27 | 5106479 DeadFred
DeadFred's picture

Exactly. The guy has nothing to lose by calling the cautious ones idiots. Anyone with half a brain knows to be cautious and will ignore what he's saying. He's trying to rope in those last few fools who are susceptible to name calling. It's the only trick he has left.

Sun, 08/17/2014 - 16:10 | 5105897 bardot63
bardot63's picture

Didn't read this.  Scanned to see who he's talking about.  Didn't say, so I don't care.  Article is meaningless.

Sun, 08/17/2014 - 16:23 | 5105935 HardAssets
HardAssets's picture

Ultimate Speed Reading Lesson #1 : If you read the title and it doesn't look like you'll  learn anything new from an article . . . don't read it. Nothing faster than something useless not read.

If you read the title and you say "Duh !"  that is an even greater indicator that you won't find anything new in the article.

Sun, 08/17/2014 - 16:53 | 5106015 Skateboarder
Skateboarder's picture

I read the first sentence and he was talking about an interview between the host and the guest. WTF. Context much?

Sun, 08/17/2014 - 20:31 | 5106618 Greenskeeper_Carl
Greenskeeper_Carl's picture

Who exactly the interviewer/interviewee was isn't really all that important. It could have probably been one of several interviews that take place on CNBS on a daily basis.

Sun, 08/17/2014 - 16:31 | 5105954 Da Yooper
Da Yooper's picture

Reminds me of the Ass Clown I hear from now & then

 

That refers to the rigging & manipulation in the metals markets

 

as " Market Forces at Work"

 

IF

 

the SEC -CFTC & other watch dog agencies did their job to rein in the corruption in the markets people would have some faith in Wall Street

 

BUT

 

they do nothing & let the theft of the GDP continues & think no one notices

 


Sun, 08/17/2014 - 16:39 | 5105982 disabledvet
disabledvet's picture

Give it a rest. "Financial shenanigans" is the realm of the political sphere not equities or debt. (NII just defaulted on 5 billion if you're even interested in reality.) Head on out to Detroit if you want to have a front row seat to the Apocalyspe.

Everyone else "parties with the Kennedy's."

Sun, 08/17/2014 - 17:45 | 5106199 Muppet
Muppet's picture

That NII (Nextel) news is marketworthy.  Last week I posted on ZH about NII's downfall.   Thats a big default thats gonna hurt some bond funds.

Sun, 08/17/2014 - 16:10 | 5105899 Cattender
Cattender's picture

Honest to God.. the stock market is REAL! LOL!!!!!!! (i swear to God!) 

Sun, 08/17/2014 - 16:31 | 5105959 Leonardo Fibonacci2
Leonardo Fibonacci2's picture

i've made 100% over the last 4 years.  You can be as sarcastic as you want but my account proves it! Dope

Sun, 08/17/2014 - 17:01 | 5106039 Clint Liquor
Clint Liquor's picture

Unless you are totally cashed out, your 'paper profits' don't mean shit. Fuckhead.

Sun, 08/17/2014 - 17:12 | 5106063 Leonardo Fibonacci2
Leonardo Fibonacci2's picture

the only fuckhead is you cause i am cashed out and my bank account proves it.  my money permits me to make the purchases i want. PERIOD!  FUCKHEAD MY ASS YOU FUCKING LOSER

Sun, 08/17/2014 - 17:18 | 5106088 Leonardo Fibonacci2
Leonardo Fibonacci2's picture

how long have ZH'ers predicted a crash? Sooner or later its bound to happen. lol

Sun, 08/17/2014 - 18:42 | 5106362 Clint Liquor
Clint Liquor's picture

You're not cashed out because you are a Stocksucker and Stocksuckers don't know what else to do with money.

Sun, 08/17/2014 - 18:50 | 5106384 Peak Finance
Peak Finance's picture

LOLZ dude, if you not afraid of the crash, why did you cash out then? 

You are either full of shit on cashing out, or, you in your heart know that the crash is in fact coming.

Which is it?

Sun, 08/17/2014 - 18:57 | 5106411 Peak Finance
Peak Finance's picture

Full disclosure:

Yes, I lost money shorting and I get killed on options regularly (options are fucking crazy now, use to be a nice small stable market!) 

BUT, it's only "play" money, I don't put anything in the market I am not afraid to lose, and this extra money I put in the market is AFTER I buy a programmed allocation of Physical, like 50 / 50 gold & silver every few weeks. 

 

 

Sun, 08/17/2014 - 17:18 | 5106090 Harbanger
Harbanger's picture

The genius is timing.  I don't know why people can't walk and chew gum.  If you have'nt prepped yourself by now and gotten back in the game to clean up, who's the fool? not you my friend.

Sun, 08/17/2014 - 17:33 | 5106158 oudinot
oudinot's picture

Leonardo:  if indeed you have made 100% in the  market as you claim, one would think that would give one a joyful countenance.

Saying things such as ""FUCKHEAD MY ASS YOU FUCKING LOSER"; is not only profane,sad and vague it belies the idea you should brrn happy  from your 'success'.

Methinks you doth protest too much.

Sun, 08/17/2014 - 17:23 | 5106112 FuzzyDunlop21
FuzzyDunlop21's picture

thats it? A fuckin monkey could have done that. Thats barely beating SPY.

Sun, 08/17/2014 - 16:42 | 5105972 AssFire
AssFire's picture

The market is real'

I believe it- in fact an ancient astronaut theorist told me they found Bigfoot's ghost on a UFO buried in Atlantis but, they lost the proof in a damn boating accident.

Sun, 08/17/2014 - 16:47 | 5105998 El Oregonian
El Oregonian's picture

...And I bet they, unfortunately, were sitting right next to those hansome and neatly stacked PM's on that boat.

Darn, what terrible luck...

Sun, 08/17/2014 - 16:10 | 5105901 buyingsterling
buyingsterling's picture

Ebola is airborne

Sun, 08/17/2014 - 16:10 | 5105904 LawsofPhysics
LawsofPhysics's picture

Optimist.

Sun, 08/17/2014 - 16:42 | 5105989 buyingsterling
buyingsterling's picture

Ebola is not airborne

Sun, 08/17/2014 - 16:52 | 5106012 debtor of last ...
Sun, 08/17/2014 - 16:10 | 5105902 LawsofPhysics
LawsofPhysics's picture

Please, do not stress, simply try and recognize the truth, that there is no market for true price discovery.

Sun, 08/17/2014 - 17:33 | 5106128 BrosephStiglitz
BrosephStiglitz's picture

In fairness, I was extremely bearish on the US stock market not so long ago.  However, since lots of the talking heads in the media flipped a switch toward bear mode, I am a lot more bullish now.

I'm still suspicious as hell, but I think the credit-fueled buybacks have been inflating the market index artificially and a lot of individual investors appear to be sharing that bearish sentiment.  I don't think we have yet see the "hockey-stick" moment.  I do expect it will come soon as capital flows reverse. 

Many companies with weak balance sheets have been outperforming typical "high performers" and well capitalized companies based on cheap credit.  In the next wave the capitalized market participants and typical high performers will once again outperform as capital flows shift.

But naturally I might be wrong and I hope anyone who is currently trading will not trade on this anecdotal information.  I would urge them to do their own research and trade as they see fit.  These markets are difficult to call because we are moving into historically undocumented territory.  Massive globalization, central bank coordination and technological shifts in finance makes things very different from the past.

PS: Still holding my PMs as a hedge against the worst case scenario, but I suspect we might see something like the scenario described over the next year.

Sun, 08/17/2014 - 19:51 | 5106535 Midnight Rider
Midnight Rider's picture

"we are moving into historically undocumented territory" - we have been in historically undocumented territory since 2009.

Sun, 08/17/2014 - 23:12 | 5107096 logicalman
logicalman's picture

We're always into historically undocumented territory.

IT'S CALLED THE FUTURE.

Few have been there to document it.

Mon, 08/18/2014 - 08:01 | 5107615 BrosephStiglitz
BrosephStiglitz's picture

What I mean, is that this type of market event/confluence of global events has not been paralleled previously- at least in data.

You know that many crashes could be predicted with the right data on hand, right?  Paul Tudor Jones tracked the 1987 stock market collapse by running data analysis on the 1929 crash and finding a very high correlation in the data.  Consequently he made a lot of money shorting at the right moment.

This time nobody really knows what the fuck is going to happen.  Debt levels are high almost everywhere.  Global growth is stagnating.  Real energy prices are rising.  Unemployment/Lack of labor force participation is on the rise.

The entire global economy is starting to implode for the first time in history.  In the past there have always been rising empires as other empires fall.  Safe havens etc.  This time the choice appears to be "invest in empire X/asset class W with a -80% return, or invest in empire Y/asset class V with a -20% return."  Of course there are opportunities (bullish nailguns), there are always opportunities, but to pinpoint and capture those opportunities will be like trying to thread a needle in a low gravity environment with your toes, while blindfolded.

After the coming recession and looking forward into the future- who knows.  We are in for an unusual turn of events.

Sun, 08/17/2014 - 16:12 | 5105908 jmcadg
jmcadg's picture

Come on, who were the interviewer and interviewee. Enquiring minds want to know.

Sun, 08/17/2014 - 16:15 | 5105909 db51
db51's picture

MY NAME IS DAVE.   AND I'M AN IDIOT!    Yep...I haven't trusted any of it since 2008 and have missed all the gains since based on the phoney data.   If you didn't play in the giant casino during the greatest run-up in modern history....well.  YOU'RE A FUCKING IDIOT.   Just like me.   Now, I'm going to go count my gold and silver that hasn't done jack shit.  

BARF ALERT!  Love fest going on in Ferguson Missouri.   Cops and Thugs are kissing each other asses, crying....the token State Policeman is started in his Southern Baptist Preacher drawl mode.....Holy Shit....To the Moon Tomorrow people.   Get on board now...the train is leaving the station.

Sun, 08/17/2014 - 17:30 | 5106143 GrinandBearit
GrinandBearit's picture

Whenever ZH posts "the market is crashing"... at that very second, go long any 3x bull ETF. 

You'll make a fortune !

Sun, 08/17/2014 - 16:14 | 5105910 philosophers bone
philosophers bone's picture

Like virginity, trust is difficult to restore once lost.  And trust has been lost in all markets, financial institutions, governments as well as main stream media sources.  And they just keep digging themselves deeper and deeper. 

United States of Ferguson?

Sun, 08/17/2014 - 16:38 | 5105981 AssFire
AssFire's picture

You used virginity and Ferguson in a post +10

Sun, 08/17/2014 - 16:44 | 5105995 techstrategy
techstrategy's picture

Well said.  Integrity in the financial sector is nonexistent.  They are going to have to eat the losses this time...

Sun, 08/17/2014 - 16:15 | 5105913 illadeljim
illadeljim's picture

FREE money! Long live the Fed!

Sun, 08/17/2014 - 16:19 | 5105923 BullyBearish
BullyBearish's picture

Reuters article in advance of market open tomorrow:

RPT-Wall St Week Ahead-U.S. stocks a safe haven, even after panic selloffs

 

Funny...I thought treasuries were safe havens????  F^%$kers!!!!!

Sun, 08/17/2014 - 16:20 | 5105926 techstrategy
techstrategy's picture

What we are witnessing is a collapse in trust of financial assets.  Wall Street is dead because it already faces extraordinary demographic headwinds.  Exit financial c assets for real and productive ones.  Let those responsible hold all the risk.

Sun, 08/17/2014 - 16:22 | 5105931 q99x2
q99x2's picture

I trust it. BTFD. The markets are a software program run by central banks. The militaries of the world back what they are doing and they have an infinite amount of money to purchase with.

BTFD BTFD BTFD BTFD

I think the computers also can handle any large numbers that are close to infinity so we have to anticipate a long long move to the upside.

BTFD bitchez.

Sun, 08/17/2014 - 18:21 | 5106303 James T. Kirk
James T. Kirk's picture

"I think the computers also can handle any large numbers that are close to infinity so we have to anticipate a long long move to the upside."

Quote overheard between Buzz Lightyear and Paul Krugman over a beer at happy hour.

Sun, 08/17/2014 - 16:25 | 5105940 Eyeroller
Eyeroller's picture

There are three types of lies:

1. Lies

2. Damned Lies

3. Statistics

-- attributed to Mark Twain by some, and Benjamin Disraeli by others.  Both men lived long before the lamestream media spin machine.

Sun, 08/17/2014 - 16:37 | 5105980 James
James's picture

Real eyes realize real lies

Do NOT follow this link or you will be banned from the site!