Slate's Bizbox
frame game: How you look at things.

Mixed Market Metaphors

By William Saletan
Posted Thursday, March 15, 2001, at 3:00 AM ET
Illustration by Robert Neubecker

As Wall Street plummets, shrinks, crashes, retreats, and melts down into a bear market, analysts and reporters seem uncertain as to which of these metaphors best captures what's going on. The answer depends on where you think the market is going or should go. Some analogies imply an upward logic, some imply downward logic, and others imply that the market's decline is grievous, salutary, inexorable, or remediable. Here's a rundown of the models circulating in this week's coverage, with their implications, their conceptual flaws, and the ugliest mixed metaphors to which they've been attached.

1. Gravity

Key words: slide, slump, dive, fall, tumble.

Assumption: What goes up must come down.

Example: "A Physics Lesson, Courtesy of Nasdaq: Tech Stocks Can't Defy Gravity After All."

Flaw: You'll fall if you hold onto stocks, but you'll also fall if you let go ("Fund Investors Not Bailing Out").

Worst mixed metaphor: "The Nasdaq composite, which sank under the weight of the dot-com implosion …"

2. Rebound

Key words: bounce, bottom, support level.

Assumption: What goes down must come up.

Example: "Tech stocks will bottom at some point and bounce along the bottom for a long period."

Flaw: So where's this floor we're supposed to bounce off of?

Worst mixed metaphor: "With so many false bottoms," "It's not a time to bottom fish," "We haven't seen the capitulation we need to establish a firm bottom," "The bottom usually comes out of seller exhaustion," "The index touches a bottom about three months after the Fed cuts rates," "Market experts have stopped trying to pick the market's bottoms."

3. Crash

Key words: wreck, smash, destruction.

Assumption: You don't bounce when you hit. You're disabled.

Examples: "There's been a 50-car pileup in tech," "Nasdaq's poor performance has hit markets around the globe."

Flaw: If we're all disabled, why does the market go up ("Stocks bounced from lows after Monday's crash") or down ("Wall Street's slow-motion crash gave way to some panic selling") the next day?

Worst mixed metaphor: "The tech wreck is already starting to infect the entire stock market."

4. Momentum

Key words: pick up steam, spur, sweep, breed, feedback, spiral.

Assumption: Things don't have to go up or down. They just maintain the same direction.

Example: "The new losses are taking on a self-sustaining momentum."

Flaw: Then why does the market keep changing course?

Worst mixed metaphor: "The forces that fed on themselves and helped Nasdaq go to the moon are feeding on themselves on the downside, too."

5. Natural disaster

Key words: storm, flameout, meltdown.

Assumption: The crisis is mysterious and beyond our intervention. It will pass mysteriously and without our intervention.

Examples: "There was no safe port in this storm."

Flaw: Is fire is our enemy ("Smell something burning? It's your portfolio") or our friend ("A big cash hoard can become the fuel for a stock rally")?

Worst mixed metaphor: "A cloudy earnings picture … could short-circuit the rally," "Technology stocks rose in choppy trading Tuesday as the market struggled to find its footing."

6. Mental illness

Key words: infection, spread, panic, immune, depression, funk.

Assumption: The problem is only in our heads. We can beat it.

Examples: "Concerns are spreading and becoming more implanted in people's minds," "The stock market doldrums could last for years."

Flaw: Are we supposed to snap out of it or work through it? ("There needs to be a climax of fear-induced selling before the market's decline can run its course.")

Worst mixed metaphor: "A collapse in market psychology could spill over into the rest of the economy."

7. Bear attack

Key words: claws, paws, carnage, blood bath, roar, rout, pain.

Assumption: Selective doom. Somebody is going to get hurt, but it doesn't have to be you.

Examples: "The Bear Roars Back for a Run on Wall Street," "Digging its claws into the broader market."

Flaw: Should you pity the bear's victim or eat his remains? ("Professional investors are gingerly picking through the carnage.")

Worst mixed metaphor: "The bear market started as a bubble," "The bear has to relentlessly hammer investors until despair takes over."

8. Football

Key words: beaten-up, bone-crushing, sidelines, throw in the towel.

Assumption: Market violence is healthy. It drives the pansies out of the game and lets the real men catch their breath so they can come back fresh.

Examples: "People are starting to throw in the towel and are submitting to this bear market," "The record amount of cash on the sidelines can get back in the game," "The crash has scared nervous investors out of the market … making room for a recovery."

Flaw: Who's playing while the sissies and real men are on the bench?

Worst mixed metaphor: "If the latest sell-off represents the bulk of investors throwing in the towel on tech stocks, the bottom could be reached sooner rather than later."

9. Bubble

Key words: balloon, collapse, implosion.

Assumption: Stock valuations are empty. There's nothing beneath them.

Example: "Market bubbles like these just don't come back quickly."

Flaw: Since when does a bubble shrink slowly? ("We are seeing the unwinding of a bubble.")

Worst mixed metaphor: "When the bubble breaks, they unfortunately over-correct."

10. Disappearance

Key words: Paper profits, evaporate, vaporize, erase, wipe out.

Assumption: What seemed lost actually never existed. Good news: No loss. Bad news: No recovery.

Example: "It was just pieces of paper. It's not real. It's not wealth. It's not money. It's just an illusion."

Flaw: Then why are you talking about it?

Print This ArticlePRINTDiscuss this in The FrayDISCUSSEmail to a FriendE-MAIL
Share on FacebookPost to MySpace!Share with MixxDigg ThisShare with RedditShare with del.icio.usShare with FurlShare with Ma.gnolia.comShare with SphereShare with Stumble Upon
William Saletan is Slate's national correspondent and author of Bearing Right: How Conservatives Won the Abortion War.
Join the Fray: our reader discussion forum
What did you think of this article?
POST A MESSAGE | READ MESSAGES

Reader Comments From The Fray:


[Notes from the Fray Editor: A few people posted their favorites: Fat Hogs get Slaughtered First, here, and the evergreen Dead Cat Bounce (see this historical yet relevant "Frame Game" for another mention).]


This was an entertaining observation of the versatility of the American language. However, a couple of metaphors were incorrectly labeled. "Doldrums" is actually a weather metaphor. "Football Metaphors" should have been titled "Sport Metaphors"; "throwing in the towel" is commonly considered a reference to boxing. (Not that any of this really matters; but if we're going to be intellectual we might as well be correct.)

--Andrew Porter

(To reply, click here.)


I applaud this deconstruction of stock metaphors. I think most of these terms are really evasions of the question "what will happen tomorrow?" For example, saying "I think we're nearing the floor" is consistent with the market going up tomorrow (see, we reached the floor and bounced), not moving much (yep, we're on the floor), down a little (okay, now we're really near that floor) or down a lot (wow, we busted through that floor and it's a long way down to the next floor).

All the statistical evidence indicates that the market is a random walk, as likely to go up after a down day as after an up day, and no one can predict it with better than random accuracy. So a finance professor, and anyone serious about the market, is interested not in the movement of the immediate past, but what are the statistical properties underlying future movements. Has market volatility increased? Are correlations going down? What is the current relationship between direction and volume? Is the market increasing its valuation of dividends relative to growth?

This sort of talk generates its own jargon. "It was a six-sigma event." "Dividend factor sensitivity is at a ten-year low." "Value-at-Risk for the S&P500 is 8 percent."

While this kind of jargon may be designed to mystify the uninitiated (there are ways of saying all the above things in plain English), it is not intended to be reinterpreted after tomorrow's results are known. Each is a statement about relative probabilities of tomorrow's events.

--Aaron Brown

(To reply, click here.)

 (3/16)

Washington Post