Quote of the Day: Wall Street Tantrums

>This is brilliant:

"It’s like monetary policy is being affected by the tantrums of Wall Street  As every parent knows, the worst thing you can do is give in to a tantrum, because then you get five more of them."
-James Paulsen, chief investment officer at Wells Capital Management.

Looks like we are having a bit of a tantrum today . . .


Bond Market Talks — and Fed Listens Closely
Justin Lahart
WSJ, November 1, 2007; Page C1

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What's been said:

Discussions found on the web:
  1. Stuart commented on Nov 1

    Citigroup’s going to need alot of pablum me thinks.

  2. Joe 6 Pack commented on Nov 1

    I say we just park the market in front of the TV and go make some more babies.

  3. michael schumacher commented on Nov 1

    got that year-end mutual fund print. That’s all that matter for the moment…you mean we still have a problem???

    I expect this movement down to be corrected before the day is out….guaranteed.


  4. vega commented on Nov 1

    With giving in being the $41B injection today? FED = TOOLS.

  5. peter b. commented on Nov 1

    Yes, with an emergency Fed rate cut.

  6. JJ commented on Nov 1

    Ha. I saw that this morning. That really sums it up exactly!

  7. scorpio commented on Nov 1

    both Crocs and UnderArmor down big. somebody give Cramer a hankie.

  8. John commented on Nov 1

    Dead Nuts On again Barry. This Market increasingly acts like a spoiled little Child. In my view it also applies to many in the Financial News Media. Sometimes the best way is to let the Tantrum work itself out on it’s own (without any outside influence). Sometimes you need to give it an old fashioned Hard Spanking (A guy namned Voelcker suddenly comes to mind…)
    Given the deteriorating economic situation in Housing, soaring Commodity Prices and the Technical Patterns/Divergences on some of the major indexes and leading sectors I couldn’t figure out what caused the late day Rally after the Fed statement was released yesterday. The .25 bp cut was already priced into the Market… unless it’s Big Mutual/Hedge Fund Bonus time.
    Well, still a long way to go… Maybe some more “Soothing” statements from Fed Officials, CNBS Pundits, Hanky’s strong dollar policy… will turn us around today….

  9. michael schumacher commented on Nov 1

    now we get held hostage for another 6 weeks while the financial “wizards” dream up yet another bottoming out scenario that is nowhere near completion. But lets give us a little time for yet another artificially created event to move the market in the one direction that is mutually beneficial to the banks and brokers. Oh and here is another $41 Billion to do it with.

    When is reality actually allowed to occur??

    Just keep buying those dips because you will be bailed out at every opp.
    Sounds like a bull economy to me….not.


  10. Florida commented on Nov 1

    Tantrum is the perfect word for some of these guys with their, “We need 11 consecutive 25 bps cuts now!” I even had to roll my eyes at Bill Gross demanding the Fed take rates to an effective zero.

  11. Costa commented on Nov 1

    Where are all the uber-bulls from yesterday? They were calling us idiots for thinking the economy wasn’t doing so great. Then you have one down day of 200pts and they disapear. Think of how shocked NOVA will be today when he looks at his account and sees his “PROFITS” magically disapeared

  12. michael schumacher commented on Nov 1

    touche’, Costa…..my thought exactly..

    Nevermind that this market is the product of artificially created events timed in unison with other “normal”events.

    I also like that I was referenced as the “resident bear”…….

    I would dearly LOVE to get excited over the market since I do this for a living….if it were real and could be chalked up to ANY fundamental reason I would be the first to say I was wrong. Since all we are doing is going from one artificial event to another I find it difficult to come to grips with the cheerleading in an environment that is not as it is constantly presented.

    and the GDP……don’t even get me started.

    IF it was at 3.9% why are we cutting rates when most all CB’s (with the exception of Japan) are on the brink of raising them???

    Sounds like a bull market to me……..in name only.


  13. Valdan commented on Nov 1

    It’s a Bull Shit market!

  14. justin commented on Nov 1

    Funny how it takes the real world, numbers of Exon, P@G, etc., to get the market to take notice. And what about those car and truck numbers – couldn’t be a better leading indicator in the bunch.

  15. Winston Munn commented on Nov 1

    Whoever reports this nonsense without comprehension doesn’t understand the Fed – yes, there was an infusion of $41B but that was against expirations of $42.5B so the Fed did a net D-R-A-I-N today of $1.5B.

    It’s like ALL headline numbers anymore – you have to know the part unsaid/unreported to get the truth.

  16. Francois Theberge commented on Nov 2

    As I suggested recently, the Fed should have hiked the interest rate by 25 basis points.

    Just for the sake of sending to Wall Street et al. that the Fed cares about the Economy at large, not only them. Oh! And also to start taming this animal called (real) inflation.

    Alas! Santa Claus stand more chances of becoming our next President than having the Fed showing some huevos.


  17. michael schumacher commented on Nov 2


    It’s not as simple as “out with the old and in with the new”

    What is not ever mentioned about repo’s is where that fresh cash is directed to or at. There is no rule or guideline that prevents these institutions from gunning WHATEVER THEY SEE FIT TO USE IT FOR.

    IF Goldman wants to juice the EWZ or MER wants to push up something that it owns there is NOTHING to stop them from doing it.

    All these institutions need to do is to return the money with the requisite premium they pay for access to it and they get a fresh new supply to do WHATEVER THEY WANT WITH IT.

    Again it’s not that the Fed does a repo. it’s what these institutions do with the cash. otherwise why would they need to exchange as asset for hard cash????

    Understand that it is not as simple as the textbook answer that the fed gives out…we do not live in a textbook world (although some still refuse to believe it).

    This is all too much to fathom if all you are going to do is read the explanation from the Fed. Remember this is the institution that SUPPORTS a strong dollar (yea right) and sanctions the crap that comes from the commerce department as real….(3.9% GDP, 166k “created” jobs) starting to see a pattern emerge???


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