Thursday, October 15, 2009

Bernie Does It Again, But Why Worry?

Recently, Bernie Madoff reportedly got into a strenuous argument with another prison inmate--about the stock market, no less. It's hard to imagine why two guys in prison would argue about the stock market. You'd think the pay phone or exercise equipment would be more important. But the discussion got so heated that a shoving match ensued, with Bernie pushing the other man to the ground. Scuffling is against prison rules, but the guards evidently didn't see the incident. So Bernie broke the rules--and again wasn't caught by the authorities. He also won the fight. At some point, you have to think some people are just plain lucky, even if they're serving the equivalent of a life sentence.

And what was there to argue about? The current stock market never met a news story it didn't like. Unemployment rising? Stocks rise. Oil prices rising, which means gasoline and heating oil will rise? Stocks rise. Consumer spending down. Stocks up. J.P. Morgan Chase, a very big bank on Wall Street that is subsidized with virtually free money from the Fed and guaranteed not to fail reports better than expected profits. Stocks rise. But how could the profits have been better than expected? This bank--and its mega-sized compadres on Wall Street--can do anything and the Fed will make sure they survive. There shouldn't be any level of profitability from them that isn't expected.

Frankly, the stock market will continue to rise briskly from here on forward, and will never, ever decline again. There's nothing to worry about for the rest of your life. You read it here first.

And if you believe that, there's a really nice bridge in Brooklyn I can get you for a song. Payment in cash--unmarked bills and nonsequential serial numbers--is required.

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