The greatest canard of all the infinite number of canards on Wall Street is technical analysis, and in particular the variant of technical analysis that asserts that investors are sensitive to particular price levels. And so, when the Dow fell below 10,000, this was an occasion for much gloom, since it presumably meant that people were now going to dump their Dow stocks. (Breaking through the 10,000 barrier being the modern-day equivalent of finding something dismaying in the entrails of a sheep.) Of course, since “the Dow” is a composite index of 30 different stocks, each of which is traded individually by people who, for the most part, don’t own most of the other stocks in the index, it’s hard to see how this sell-off was exactly supposed to happen, but it was. And, of course, it didn’t. Happen, that is. The dream always is that this will keep anyone from ever talking about Dow 10,000 or Nasdaq 5000 ever again. But man, there is a lot of time to fill on CNBC and CNNfn every day.
1. “Palm Computing, makers of computerized Filofaxes, went public Thursday and, as anticipated, the stock shot through the roof, reaching as high as $141 before falling back a bit. In 1995, U.S. Robotics acquired Palm, which was then an independent company, for $44 million. The company is now valued at $20 billion. There is a lesson here. But I can’t find it, because I’m still thinking about the fact that I didn’t get any shares in the IPO.”
2. “The Wall Street Journal reports that a new Canadian law requires half of the front of all cigarette packaging to contain an anti-smoking warning which includes one of 16 different images of a body part damaged by smoking. Those advertising meetings have got to be great: ‘Well, I think the cancerous lung is the least repulsive of these pictures?’ ‘I don’t know. I think the diseased larynx has a certain kind of sublime beauty to it.’”
3. “In the ongoing rush to cash in on Wall Street’s mania for so-called business-to-business Internet stocks, printing company Landmark Productions has changed its name to httprint. In God’s name, wwwhy?”
4. “The Book-of-the-Month Club and the Literary Guild announced this week that they were entering into an alliance that will bring all of their associated book clubs under one roof. The Literary Guild: There’s something so 1974 about that. I wonder what this will do for the sales of Sidney Sheldon’s books?”
5. “In the wake of John Reed’s resignation as co-CEO of Citigroup, press accounts said that Reed’s departure was occasioned in part by the fact that he had been ’outmaneuvered’ by co-CEO Sandy Weill during the company’s reorganization last July. What none of the accounts explained was exactly what this outmaneuvering consisted of. It’s as if we’re supposed to assume that Sandy Weill has an awesome first step and a killer crossover dribble, and that meant Reed was doomed.”
6. “According to a recent study, last year the pay of CEOs at top-performing companies soared, while the pay of CEOs at poor performers actually tumbled. Of course, the interesting question is whether this is a ‘Man Bites Dog’ or ‘Dog Bites Man’ story. Or perhaps it’s a ‘Man Pets Dog’ story, or a ‘Man Takes Dog …’ OK, enough.”
7. “The Federal Reserve released transcripts of its policy meetings from 1994, only six years after the fact. The New York Times’ take on the transcripts was that the Fed’s 1994 round of interest-rate increases began ’without any clear sense of how strong the economy was, how many rate increases would be needed or how the stock and bond markets would react.’ Truly inspiring picture, isn’t it?”