The New Normal

There is a tremendous normalcy bias at work.  I just had a conversation about stock market and investing. We were talking about this latest retreat in portfolios. The person I was talking is someone who is more on top of things than me. When it comes to investing at least.

Anyways during of talk he said he lost a lot of money in last couple days. But he was confident that he still has his finger on the pulse. He noted that although Canada is not doing well the United States is still growing at a rate of 2.3%. I’m not sure where he got that number at. I did try to counteract his hypothesis with some stats on Labour participation rate, the Dow Transportation Index, The Baltic Dry Index. The usual charts and opinions found on pages and websites of scores of so-called experts.

I ended by saying there are three types of information.

Lies, Damn Lies and Statistics..

In essence I was telling him that I didn’t really believe what I have been told by the Wags on MSNBC. How can I know what is going on when the market is rigged and HFT computers have undermined price discovery which is only way a fellow like me could ever hope to compete fairly with Corzine et al. It may have always been like this, who knows. I may be a fool but I don’t think it is wise to be putting all your chips on the table in this casino.

What I don’t get is how entrenched the delusion is and in those who should know better. But everything is okay until it isn’t. Sort of like marching to Moscow with the little corporal. Take your pick as to which one. They start out throwing flowers on the street but then winter sets in and there is nothing left to eat and no wood for the stove. All the land conquered meaningless. I wonder what people are going to say about this world we live in 200 years from now and the waste of precious resources used to maintain this facade of prosperity.

I’d say we deserve whats coming but it will be those who decline to be a part in the delusion who will be asked to pay.


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