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Neither a Buyer Nor Seller Be

Posted by Larry Doyle on November 6, 2009 1:18 PM |

What does it all mean?

Observing the market’s muted reaction to the Unemployment Report this morning makes me think of a phrase not popular on Wall Street. That phrase, ‘neither a buyer nor seller be’ sends a mixed message bordering on indifference as to market activity.

Why are so many market participants not involved or less caring of the daily price action? I would put forth the following reasons:

1. Overriding concern with trying to get their own financial house in order.

2. A general level of disbelief in the integrity of certain market structures (for example, high frequency trading activities).

3. ‘Don’t fight the Fed’ meaning when the Federal Reserve is actively involved in the market, as they are now, it is never prudent to take the other side of the Fed’s trades.

4. Limited trust in the financial regulatory oversight of Wall Street.

5. Limited trust in the statistics being put forth from Washington. For example, questioning the integrity of the 640k figure of jobs saved or created by the Obama administration.

Add it all up and what is an individual to do?

Neither a buyer nor seller be….

What do you think?

LD

  • Mike

    I think we’ve proved that we CAN print jobs!

  • coe

    LD – Maybe you implicitly point to it in your first comment, but I think a major factor contributing to the malaise is the fact that there has been a lot of resurgent profits taken by various investor classes during this run-up, and many folks are heading into the four corners offense. No need to blow it all as we head into year end. The idea of taking the air out of the ball also seems to make sense given the uncertainties and other dynamics you cite. For fixed income folks, the absolute level of yields is nothing to get excited about. In addition to the Wall Street supervisory issues, who can possibly believe Obama’s regulatory reforms will prove helpful to the financials?! I wouldn’t pay a nickel for the collective insight and wisdom of Frank, Pelosi, Reid, and Dodd, nor would I expect the alphabet soup politics and inadequacies of the FDIC, OTS, OCC, FHFA, SEC, FINRA, and the FED to crack the code either.

    Sometimes, it just makes sense to sit it out until time passes or things are clearer. The dollar is destined to stay low and will likely sink lower, the government printing machine will be injecting liquidity 24/7, the consumer/commercial credit exposures will be “really most sincerely” death by a trillion+ additional write-downs, and there is nothng more debilitating than not the 10.2% but the 100% unemployment rate one faces if it is you that has been fired or cannot find work (unless of course we start to talk about higher taxes and socialized health care). Talk about confidence – HUMBUG!

    Give us real political and financial leadership, true accountability, honor and ethics, freer markets, and grown-up behavior…now that’s what I’m talking about for the safety and well being of the present and future generations!

    • Larry Doyle

      Coe,

      You add many arrows to our quiver.

      What a world!!






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