Paul B. Farrell: Wall Street’s profits addiction and $100 million trading days will drive America over a new 1929-style cliff and into a new Great Depression II…It’s Inevitable!!!
February 13th, 2013
By Paul B. Farrell, MarketWatch
Wharton School economist Jeremy Siegel, author of two classics, “Stocks For the Long Run” and “The Future for Investors,” is one of America’s most respected financial minds. He recently told cable channel CNBC that Dow 15,000 was “definite,” with 50-50 odds of Dow 17,000 by year-end 2013.
He even doubled down in Kiplinger’s: “My Dow 17,000 projection may turn out to be too timid.” Now that’s real bull, a 20%-plus gain for 2013.
Dow 15,000? Dow 17,000? Irrational exuberance? DNA flaw? Delusional? Or are these predictions just typical marketing hype calculated to drive Main Street’s 95 million investors into Wall Street casinos for another end-of-a-bull-market slaughter?
Whoa, stop, take a deep breath before we dissect Siegel’s over-the-top Dow 17,000 prediction. First, a refresher course in basic market psychology. Let’s remind ourselves: There’s a profound difference between the DNA, brains and biases of bulls versus bears.
A bull brain has a massive blind spot. They can’t see the light-at-the-end-of-a-tunnel. Only short-term profits. Wall Street makes money on the action, on volatility. Whether up and down generates opportunities and profits. Bulls blindly hang on till the profitable last drop. Bears do see the light. But once lured into the game, they’re blinded by the light. Trapped as both ride over the cliff.
One more time, Wall Street will push everyone to the edge … and over