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Roger Lowenstein, F**k Your Stock Portfolio


#1

Roger Lowenstein, F**k Your Stock Portfolio

Dean Baker

I realize it would be too much to ask that people who write on economics for major news outlets have any clue about how the economy works. I say that seriously; I have been commenting on economic reporting for more than two decades. Being a writer on economics is not like being a custodian or bus driver where you have to meet certain standards. The right family or friends can get you the job and there is virtually no risk of losing it as a result of inadequate performance.


#2

“Bill Clinton with data and charts in 1998” ???

Recall that it was third party candidate Ross Perot who serially utilized data and charts during the 1992 and 1996 POTUS campaigns. Too many Murkins obviously preferred fact free smoke and mirror Clinton and his three fact free successors.


#3

Our economy has been distorted so much over the last 30/40 years when I took only 3 terms of economics, I cannot understand much of this. We’ve given so much away to other nations, multi national monopolistic conglomerate corporations, the the decadent greedy rich sycophants thru US Congress deregulations, varies congressional policies written into law, among the biggest is tax preferential to these people.

It will be hard to crawl back. The people who should know, don’t. They work against the interest of the many.


#4

Mr. Baker,

This might be a stupid question, but, in the spirit that no question is stupid, I pose it for clarification.

It is an established fact that a disturbingly major proportion of “trades” on the stock market are computer generated by algorithms that have little if anything to do with actual [material] value, other than the motions of the trade. Sort of the latest, flashiest version of cleverness. I point out that ‘clever’, rather than the smarmy compliment is, wittingly or otherwise, actually an insult. Far short of intelligent and coherent, clever speaks to advantage rather than justice.

That aside, my question is: How does any given holding enter into the full predation of the algorithms? Wouldn’t establishing ‘protectionism’ as noted by you, which ‘sent markets tumbling’, be the most efficient means to trigger the algorithmic mayhem and, in essence, be the proverbial ‘wet dream’ of traders?

The ancillary question being: What would the legal term be for criminal activity if proven that this ‘clever’ move is replicable strategy to guarantee the faucets turn on for a sort of a penultimate “insider” trading ?


#5

Not to be argumentative, but recall that the Clinton era is defined by technology advancement - computers, cell phones, digital cameras, flat screen TVs, Hybrid and all-battery EVs - all of which still have tremendous potential to reduce energy consumption (despite big oil obstructionism). It was the internet and related global commerce that caused the dotcom crash of 2000. Stock brokers at the time failed to see how the new market came with higher costs of transport. Likewise, Amazon now refuses to admit how their retail system has the same transport costs and economic impacts to bring into account. In this way, we can single out a larger target than democratic presidents for scorn, namely the American public who are sorely misled by free market interests.


#6

Anyone wonder what would have happened to the national casino we call the stock market if the criminal Wall Street banks had been prosecuted for buying off the rating agencies that rate the assets traded in the market ?
This criminal act cost retirees billions of their hard earned retirement funds, yet no one went to prison.
What was Mr. Lowenstein’s position on this little SNAFU ?

If you’re not very rich, or can afford to lose what you gamble, keep you’re money out of the national casino.


#7

Control of the casino would have been achieved if the US Government had taken over the too big to fail banks in 2008 the way the Government took over six bankrupt northeast railroads in 1976, reorganized them as Conrail, nursing them back to health, then turning Conrail into a publicly traded corporation and selling it to CSX Railroad and Norfolk Southern Railroad.

There is no excuse for not taking over Wall Street banks in 2008 when you consider that railroading, especially in the congested northeastern US, is inherently more complex than banking. Banking is complex only because the banksters own enough congresscritters to make it that way and playing a shell game with us. Profit in confusion, profit in complexity is the unwritten motto of many corporations, especially investment banks.


#8

“The value of the stock market does not equal the country’s economic well-being.”

And then the talk is on nothing but economics ?

Bullshit - stupidity - head in the sand - or is it in the clouds.

As there is currently, or even lately, no article discussing environmental Armageddon - this article will have to do:

The Arctic Is Breaking Climate Records, Altering Weather Worldwide The Arctic climate is shattering record after record, altering weather worldwide

To remain slightly on topic, I will also link to Yanis Varoufakis, an “erratic Marxist”, which is as close as I think we can get to a real economist understanding the real world:

The maverick former finance minister is in fighting mood as he launches his new party, MeRA25


#9

" Never invest a dollar more in the stock market than you can afford to lose ". A Very Wise Man
Without the very favorable tax treatment ( tax law ) afforded to many Corporations and Investment Groups, the markets wouldn’t currently be so irrationally exuberant. A mere 10% correction, not nearly close to the truth, in the here and now coming down the pipe.
Artificial wealth is already creating another real estate bubble. We just can’t seem to see the lousy condition of the forest for all the diseased trees. Subprime lending has already created one smaller bubble in the auto industry and, therefore in that shakey and shady business, as well.
" The more you subsidize something, the more you get of it ". Our corrupted government policies when it comes to cutting the lifesaving benefits of quality education, healthcare and the social and general welfare of the entire country. For the corrupting beneficiaries, like the MIC, who only represent about 10% of the entirety of us. Pretty sick, really.


#10

I find it disturbing (to say the least) when pieces written on the “economy” are removed from the fact that there would not be an “economy” without fossil fuels. And the extraction/burning of fossil fuels is the cause of global warming which is in part (along with habitat degradation and more . . . )causing the sixth extinction.

I would rather see an article from an “economist” on what is hidden in most people’s 401 K’s’ or f **ing stock portfolios ----i.e. how many people are investing in fossil fuels and do not even know it.

Or even better yet, how the biosphere could possibly survive the ravages wrought by the “economies” of Homo (un)sapiens?

But back to Dean Baker who wrote this in 2015:

“Historically, growth has been associated with increased use of fossil fuels and other resources, but that link has gotten much weaker over the last 15 years. Furthermore, with the right incentives, such as carbon taxes and subsidies for clean energy, there is no reason to believe that the link between growth and environmental damage could not be severed altogether.”

Really? Any facts to back up the part about the weakened link?
What I read here is a perpetuation/promotion of infinite growth on a finite planet.

From Phys.org news in 2016:

“As long as markets fail to account for the environmental damages from using fossil fuels, there will always be incentives to develop new techniques to more efficiently access these resources,” said Thomas Covert, an assistant professor of microeconomics at the University of Chicago’s Booth School of Business. “It seems unlikely that our technological abilities to recover fossil fuels should stop improving any time soon. With continually improving technology, the world will likely be awash in fossil fuels for decades and perhaps even centuries to come.”

Read more at: https://phys.org/news/2016-02-world-economy-fossil-fuels.html#jCp


#11

That is undoubtedly the track we are on - but there are more and more reasons to believe this scenario will not play out.

The natural world is dissed - and we will lose this battle.


#12

John Kenneth Galbraith said it years ago: THE STOCK MARKET HAS NOTHING TO DO WITH HOW THE GREATER ECONOMY IS PERFORMING.

Prissy money dandies like “Larry Kudlow” were hired on as prostitutes years ago to drill just the opposite into people’s heads during the 1980s’ and by and large succeeded. All the cowards on television business “news” yaking for a few decades about “the market” has taken it’s toll. The average American actually believes it.


#13

Thanks for your response many summits.

I am beginning to accept what you say above . . . . not sure what full acceptance looks or feels like as this is something new for humans (accepting the demise of most if not all life on the planet due to humans)----I don’t know how to integrate full acceptance of this into the life I have left on the planet.

In keeping with this piece on the “economy”:

It amazes me how many self proclaimed progressives can compartmentalize their retirement and bank accounts from the life killing machine that is capitalism and oligarchy of the u.s.

We are all trapped in this pathological Faustian bargain with extractive, greed fueled, parasitic economies, and the resultant global dimming amid the sixth extinction. It will not end well. I wish I could see how it could.
But I can’t. Not with articles like this (and there are countless) appearing daily and not with what I see every time I walk outside or look out a window:

http://www.resilience.org/stories/2018-04-01/silent-spring-revisited-new-worries-human-future/


#14

My father dabbled in the stock market and always lost money. Having learned his lesson, I own no stock. In fact, the majority of Americans probably don’t own stock, so the market doesn’t have an impact on us until it tanks and our Congress Critters bail out their rich friends while we foot the bill.

Mr. Baker, most of us know the truth of this. It’s why we hate our politicians and want corporate CEOs either in jail or dead. I’m hoping the next financial implosion will finally bring on the next revolution–the French kind.


#15

Real Estate is another example of how the so called “Free market” as a reflection of economic well being a crock. I read recently an article about how Ireland was to push for 1.5 million immigrants by 2025. While this was an article from a Nationalist group worried about the disappearance of the Irish Culture , there were certain truths that came to light.

The reason the Irish Parliament wants to push this is for reasons of “economic growth” They are worried that the irish population not growing fast enough and the consequences of this would be FALLING HOUSE prices which in turn would hit Household Wealth. This even as the costs of a private home growing faster then incomes.

So here is the reality of housing. In order to make a return on investment an artificial shortage must be maintained. In order to maintain that shortage prices must not reflect the true intrinsic cost of the home in question, they are premised on demand. If a there a home for every person that wants one, then Real Estate values plummet and that “paper wealth” lost. This is seen as “Bad for the economy”.

In other words there MUST BE the homeless and there MUST BE debt. In other words There MUST BE growth and there MUST be consumption or the whole thing collapses. All of this fuels environmental destruction as the living world around us turned into a product and consumed to ensure “The economy remains strong”.

This is CAPITALISM.


#16

Happy Easter Caroline ! (I am secular - it doesn’t matter - we can always celebrate hope)

We are not trapped, unless we give in.

As the saying goes, ‘if you think you can, or you think you can’t - you’re right !’

I was in fact a stockbroker the year after the crash of 1987, for one year, enough to convince me the game was rigged - and I was out. To my knowledge, no one with whom I dealt lost money if they listened to me, but ‘burn and turn’ is unfortunately not uncommon.

I tried a few other things, eventually returning to the oilpatch - as a consulting wellsite geologist - a specialist in exploration - heavy oil, having developed unique field procedures for the acquisition of sample cuttings and their interpretation in real time.

A very real profession, with lots and lots of ‘skin in the game’, and an ethos not unlike the military - wherein a mistake by one can cost plenty for the many right beside you. And at the time, I considered myself a hunter in the classic sense, bringing back the meat for my society.

Now we understand we have to change - to get off fossil fuels as quickly as possible - but there are formidable obstacles - many of them, and of completely different kinds. There is the greed and business as usual lobby, to be sure, and bought and paid for politicians. But there is also inertia and necessity - collapse would be virtually instantaneous should we stop the use of fossil fuels overnight.

In any case - I left the ‘patch’, and for the next seven years climbed mountains full time - also a 'skin in the game ’ pursuit - very very real. To feed my habit, I cashed in all my assets, my RRSP (similar to your 401K’s I believe), sold my condo - and became impecunious, happy and content, and then I met a kindred soul, my future wife, also a climber, and our son is now thirteen.

It can be done - I did it.

JFK’s sayings, Mikhail Gorbachev’s “The New Russia”, Yanis Varoufakis’ “Adults in the Room”, and Shimon Peres’ “No Room for Small Dreams” grace my bookshelves - my political side, but at heart I am always a scientist,a field geologist, and climate change and biodiversity loss and mass extinctions of the past are still of consuming interest to me - because I want to survive, and I want my son to survive.

There is only one kind of leadership worth anything - by example.

Nassim Nicholas Taleb has a new book out, which I have on library hold. It is worth a read I think, and it might even provide a more extensive answer to your questions, which I have only briefly attempted to answer.

Skin in the Game: The Hidden Asymmetries in Daily Life by Nassim Nicholas Taleb


#17

Ross was the most honest man running. Too honest, and not photogenic enough for Murkin tastes. Too bad.


#18

Just remember this, that the REAL WEALTH in this country is built on either slave labor in this country or slave labor overseas with asset grabs of resources… Anyone who believes a free market controls these psychopaths is blowing the good stuff…


#19

Agreed! It is disgusting and getting worse and we the people don’t make it clear we aren’t gonna take anymore it will continue. We cannot depend on democrats.


#20

Fellow travelers, please take a moment to reflect on what the stock market is. Basically it’s a place where you can invest in things comparable to a slaughter of innocents and not even know it. Whatever profit is made from such actions you have no worries… your hands stay clean due to your ignorance.

The stock market(corporations) needs your $ and ignorance to operate.

Consider divesting if you have a conscience.