[These are ideas I’ve been toying with for a few years – and some of my notes are dated relative to this interweb post. At this time, I still don’t buy that the underlying economy is experiencing the same recovery we’ve seen in world equity markets since bottoming out a year ago – we can all mark the date – check the chart of TSX and SP500 from late last February up until yesterday’s close. With a spate of stocks setting new 52 week highs recently – it still looks like the major indices are facing new resistance. With this thought, I generally end up humming The Guess Who’s She’s Come Undone.]
June 2009: With reference to my own ‘restructuring’ out of stock trading earlier this year – I return often to the notion that I have become an exhibit of my own thesis of the markets and of the world economy as a whole. Not only are we experiencing a global cyclical downturn but a coincident and magnifying one that is structural in nature. My own case aside herein, there remain many sources of evidence to this effect, which will in no doubt protract all aspects of the “cirque du credit” blanketing all with its big top these days.
This critical juncture demands reflection and grinding through provides opportunity to do just that, offering a chance to examine the big picture in contrast to the normal, myopic focus on the day to day gyrations of one index or another. When the psychological pendulum of the market swings back from fear to hope, what will this hope be focused upon? More importantly, for the sake of a fragile environment, what should this hope be focused upon?
More than 200 years ago, psychology guided actors party to the first contracted exchange of stock certificates under a buttonwood tree in New York. Now, as then, this inextricable influence is of utmost importance. What does the market think and what do we want it to think? What is the structural mindshift required to catalyze an accompanying resource shift in favour of our collective future?