Power to the Powell!
You're walking around blind without a cane, pal. A fool and his money are lucky enough to get together in the first place.
--Gordon Gekko, Wall Street
Good morning and welcome back to the street of dreams. This morning, in the middle of Sheep's Meadow, there was a high powered pow wow involving the biggest of the big, the sharpest of the sharp and the coolest of the cool. Our carefully place microphones picked up the conversation that occured on this misty morning and, through the miracle of modern technology, we're now able to listen to that conversation. Listen in...
Bud Fox: How much is enough, Boo? Life comes down to a few moments and this is one of them. Either you're going to take your trade and move to the sidelines or allow the market to lift and climb the wall of worry. Time's running out kid, what's it gonna be?
Boo: (standing firm in his trenchcoat) It's not always the most popular...critter...who gets the job done, Buddy--it's the one with the firmest grasp on reality. Maybe you've been shacked up with Darien too long and haven't noticed what's going on. The geopolitical landscape, while perhaps bordering on being too conventional of a concern, is risky for a reason. While there may only be a...say...15% chance of global escalation, that 15% chance could lead to a cataclysmic series of events--and it's that (potential) price discovery being discounted by speculators.
Gordon Gekko: When I get a hold of the son of a bitch who leaked this, I'm gonna tear his eyeballs out and I'm gonna suck his friggin' scull!
Hoofy: Uh...GG, this isn't a big secret, it's been out for a while. That's the thing...when everybody is freaked out and scared to buy, it typically leads to fantastic opportunities. I mean, how much money do these bears wanna make? How much is enough?
Gordon Gekko: It's not a question of enough, pal. It's a zero sum game, somebody wins, somebody loses. Money itself isn't lost or made, it's simply transferred from one perception to another. You, out of all critters, should know this. You rode the hog into the ground and started this whole mess! The point is, greed is good. Greed is right. Greed, in all of it's forms--greed for life, for money, for knowledge--is what makes Minyans of us all!
Bud Fox: Whoa, hold on now Gordo, why do you need to bring that to Minyanville--this is a good, humble town. These Minyans, those that have taken the time to further their understanding of the financial environment. aren't in it to rule the world...they're simply trying to get by, make some money and live their lives. It's funny, the things that we once took for granted...the parts of our lives that we put on the back burner so we could find the hot dot.com or the next best thing--has been our goal all along. The only reason we work...is to live. Yet, over time, they became mutually exclusive endeavors. It's sad, really, that it takes tough times to make us realize the simple things.
Boo: Do you want a Kleenex, Bud? I mean, spare me the bleeding heart liberal crap. People don't read Minyanville for perspective...they read it to help them make better financial choices! Do you really think that they wanna hear this? Or do you think they wanna know that Chambo pulled the (yawn)same card last night? That, Cisco, for as good a company as it is--is a troubled stock. Do you want to bet on a business that ties it's fortunes to the "invevitable economic recovery" while grinding out performance through cost cutting?" The only thing that's inevitable are death, taxes and Toddo's inability to lose weight! Cisco's a hat size...get used to it.
Hoofy: Ahh, but you forget, Mon Frere, that trading isn't about news in a vacuum, it's about the three dimensional juxtaposition of news, field position and psychology. Good news that's not great will get sold in an extended (giddy) tape while bad news that's not horrid will get bought in an oversold (glum) market. Remember, as traders, we're not as concerned with the destination as we are with the path that we take to get there.
Gordon Gekko: Do you ever wonder why fund managers can't beat the S&P 500? 'Cause they're sheep...and sheep get slaughtered. If I've learned anything in my days in the street, it's that conventional wisdom, while conceptually safe and secure, often leads to painful company. Does it really matter if all your neighbors are down 20%...if you're down 10%? Think about it...and think about how you want to approach the stock market. This ain't no dress rehersal kid, this is the big leauges...and the decisions you make will last a long time.
The rain started to pour a bit harder on the four icons and the wind picked up from the east...and they knew it was time to go. Gordon, stud that he is, looked over at Hoofy. "You know," he began, "That Daisy is a fine looking piece...if she ever tires of your bull and wants to try uptown living, you be sure to give her my number." Hoofy looked at Gordon, then at Boo, then back at Gordon...and he could barely contain his smile.
He turned to exit the park with a microphone in his pocket and a pep in his step. He knew that cocky traders were doomed to fail and the higher they were, the further they had to fall. There was a lesson in that...and, if nothing else, there was justice in the world.
Good luck today.
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 email@example.com.
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