When asked what the market would do, J.P. Morgan famously answered, “It will fluctuate.” But what happens when 30 percent of the stocks in the S&P break their 42-day moving averages, and when the advance-stagnate line moves up and down like a broken EKG? Then what will the market do?
That’s right. It will fluctuate. And lately it’s fluctuating the way Robert Hays flew that jetliner in Airplane!: like it needs Robert Stack to come in and slap it in the face a few times to calm it down. (Block that metaphor!) Anyway, once again this weekend comes as a relief to those of us who are a little weary of assiduously perusing the pages of the Wall Street Journal while listening to the latest musings of some technical analyst who’s convinced he can discern meaning in the shapes of the clouds. This week’s installment of Cocktail Chatter reflects that fatigue, so if you choose to drop any of these bon mots into the flow of conversation, you could do so with a slight air of world-weariness. On the other hand, sometimes a really upbeat approach works as well.
1. “Cendant now claims to have finally closed the books on all of its accounting problems. CEO Henry Silverman said today, ’[T]his is just business. It has nothing to do with life or death. It’s just money.’ Why is it that executives only say, ‘It’s just money’ after they’ve lost investors huge amounts of it?”
2. “Okay, so this isn’t a bear market, exactly. We keep lurching forward a little before falling back again. Maybe it’s a panda bear market: cute, but with really sharp claws.”
3. “Boeing’s stock jumped on Monday on rumors that its CEO was going to resign, then fell when he didn’t. So now the company’s laying off 11,000 employees. Let’s get it straight: The market didn’t want everyone to leave. Just the CEO.”
4. “When news broke that British Petroleum and Amoco would be merging, the unprecedented happened: The stocks of both companies rose. And this is actually a merger that makes sense. The boom-and-bust cycle most industries go through makes consolidation a useful way to deal with over-capacity. Merging is more efficient (and safer) than having your rival’s tankers and refineries blown up.”
5. “Japan’s Economic Planning Agency announced Tuesday that the economy was in worse shape than it had previously said. What’s next? Is Dan Burton going to go on national television and announce that he really is crazy?”
6. “I hate to say this, but it’s hard to believe that Russian authorities aren’t making things worse with their attempts to curb speculation in the Russian stock market. You can’t restore confidence in an economy by instituting rules designed to keep people from moving money out of that economy. All it does is ensure that people won’t move in in the first place.”
7. “Internet company GeoCities went public this week, and promptly got beat down by the FTC, which said it was selling information about its subscribers to advertisers. No matter. The stock’s still up more than 100 percent for the week. Dot.com, baby! It’ll be a surefire recipe for success. Until it isn’t.”
