Seems Like Old Times

By Todd Harrison  MAY 16, 2007 8:11 AM

The more things change, the more they stay the same. Such is the story of life, and so it is for the markets as well.


“The definition of insanity is doing the same thing over and over and expecting different results.”
--Benjamin Franklin

The more things change, the more they stay the same. Such is the story of life, and so it is for the markets as well.

I’ve been trading for sixteen years, through Orange County derivative disasters, Asian contagions, new paradigms and lost fortunes.

I’ve gone through periods when I’ve seen the seams on twisting curves and withstood stretches when I couldn’t hit the side of a barn.

Yeah, it’s safe to say that I’ve chewed through alotta markets, some very well and a few I’d like to forget.

When I sat down to scribe today’s vibe, I weighed a choice of topics.

There are the all-time highs on the Dow, but that’s old news despite the daily dance.

There’s the risk in the system, from housing to debt to geopolitical fret, but nobody wants to read about that while the screens are green.

And there’s private equity and merger mania but alas, we’ve seen that movie before.

Indeed, it seems as if we’ve already seen many of our current story lines, albeit different iterations. We call it Vuja De in Minyanville, the strange sensation that we’ve been here before but nobody remembers the ramifications.

To wit, when comparing the late nineties pre-bubble mindset to the modern day perception, it seems as if the names have changed to misdirect the innocent.

Back then, globalization was the justification for growth. Today, it is the root of isolationism and a path towards nationalization.

Back then there was margin. Today there is credit.

Back then, folks flocked to day-trading firms. These days, condo-flipping is in vogue.

Back then, politicians were targeting corporate America. Today, they’ve taken aim at lending practices.

Back then, we had the Greenspan put. Today, we’ve got the Bernanke helicopter.

Back then, Dan Dorfman moved markets with his opinions. Today, Jim Cramer is a self-proclaimed equity evangelist.

Back then, corporate malfeasance was being fingered by the misdirected masses. Today, insider trading is in the wake of the blame.

Back then, we had venture capitalists. Today, we have private equity.

Back then, we rationalized valuations. Today, we’re collectively cool with debt levels.
Back then, Nobel Prize winners could do no wrong. Today, Goldman Sachs pedigrees are viewed in the same vein.

Back then, there was a scramble into index funds. Today, there is a race to chase the hedgies.

Back then, the FOMC walked the tightrope. Today, they’re fitting a noose.

Back then, Julian Robertson capitulated. Today, Richard Russell is seemingly doing the same.

Back then, we had a financed based economy. Today, we have a finance dependent economy.

Back then, Gordon Gekko was a financial icon. Today, or at least in production, he returns as a hedge fund manager.

Back then, we saw a fear of missing. Today, we have exactly the same thing.

There are plenty of threads between the decades but perhaps the truest extension is the consistency of entitlement. In an age when the middle class is in the process of being eradicated, nobody seems to be where they wanna be.

It has never been written—not here, not anywhere—that indulgence is due for simply showing up. Indeed, profiting is a privilege, not a right, and the quest for reward should never arrive without an acknowledgment of risk.

Perhaps class wars have existed since the beginning of time and maybe I'm late to the game in noting them now.

But as someone who has seen both sides of the ride, I can relate to the indifference of the deep pockets and empathize with those forced to make choices. Ironically, both ends of the spectrum seemingly share a common characteristic.

They both pine to keep up with the Dow Joneses, with the have-nots aspiring to be haves and the haves always wanting to have more.
No positions in stocks mentioned.

Todd Harrison is the founder and Chief Executive Officer of Minyanville. Prior to his current role, Mr. Harrison was President and head trader at a $400 million dollar New York-based hedge fund. Todd welcomes your comments and/or feedback at

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