Daily Speculations The Web Site of Victor Niederhoffer and Laurel Kenner

 

The Chairman
Victor Niederhoffer

Home

About Victor Niederhoffer

 
Write to us at:(address is not clickable)

7/26/05
Victor Niederhoffer on Horror Movies and the Abelbufflecketts;

There is something terrible about the movie Lost in Translation that explains why markets have more than their usual 1.5 million % a century drift ahead of them imminently. The terrible thing about the movie is the hateful arrogance Bill Murray shows towards the Japanese and his utter contempt for them and the business system where they request him to do two or three takes of his one-minute Saitoro commercial to earn his $2 million fee. How importunate of them, he thinks, to politely ask him to put more emotion into his delivery than his usual deadpan style, now regrettably repeating itself in the equally demeaning and hateful, Broken Flowers where he truly is amazed that his son and step wife are put off by his lack of emotion, and is turned off by their banal views and lower brow middle class habits as compared to the sophisticated kinds of things that dead pan comedians like him find titillating.

But why do the Bill Murray's of this world get unanimous favorable reviews and command the mega bucks, the only comparables being the 90% of the other successful films that are horror shows. You see, the average American is completely insecure. They love the horror shows, they love the comedians who put them down, who make them feel insecure because they don't set up their jokes with an elaborate lead, because it enables them to play act their fears about their own self worth.

The same thing is at work with all the mumbo jumbo about how the American system is about to crumble, how the stock markets about to go to 5000 again, about the jobs we don't create, the terrible things we spend our money on like SUV's instead of saving for factories, the corruption of the financial reporting and business ethics as exemplified in the Enron story.

That's why the weekly financial columnist is the most revered man in American financial journalism, and why the sage is considered the world's greatest investor, with the greatest wisdom for the masses even though his stock hasn't gone up in 8 years, and he hasn't found one stock he likes that he might buy during this period except for the proverbial See's Candies that brokers sell him when they cant find anyone else to pay above book for these substitutes for the short line farm implement type companies and declining regional retailers he used to like to buy before Charlie taught him that you can just buy something good and hold forever, the second worst idea in the history of American business since there is so much change from year to year that you must always be dynamic in your investment portfolio.

In any case, as our insecurity mounts, as our desire to play act our insecurities rises, as manifested in the popularity of the horror shows, and the Bill Murray put downs, we become more prone to mumbo jumbo about the coming market Armageddon. The professors play their role in this by talking about the declining risk premium we can expect to see in the future, and the incredible unpredictable volatility and fractality and earthquakery black swan disasters, we can expect to find lurking in the future, thereby providing a backdrop for people to express their horror film insecurities by eating up the advice to avoid stocks. But of course, that's why the IPO's have returned 50% a year the last few years, and can be expected to set the bar for other returns as long as the horror films and the Bill Murray's and the Sages remain in the limelight.

What could be better for the poor specinvestors of this world who do not share this gloomy view?

Pam Van Giessen adds:

Hasn't it always been thus, particularly with Americans? As our lot improves, we keep looking/expecting the proverbial other (bad news) shoe to drop. Perhaps it's a war between the optimists and the pessimists. Pessimism seems to make for better (easier) theater/entertainment than optimism. Everyone knows Jaws; who even remembers Rooster Cogburn?

Perhaps Dr. Brett would have something interesting to say about the psychology of society on a larger scale?

A response from Kim Zussman

Another interpretation takes into account the common, but not universal, male middle (of what?) age burn-out. A younger Murray would likely have been excited and honored by his Japan visit, but the weight of his banal, financially successful life robs him of this pleasure. Until, of course, megatart Scarlett Johanssen inexplicably and situationally chemotaxes toward him. That'll wake 'em up (did me) toward life and even the Japanese.

Perhaps this is yet another example of Hollywood social opinioneering: We are sooo successful, sooo prosperous, soooo bored because we lack the soulful humanity of cultures like Japan. Or Russia, where the soul was invented.

Maybe such preoccupations with sybaritic sensationalism distracts from puerile capitalistic objectives, such as feeding and housing society? (Na-Zdarovya: the Russian toast which means "To your health")

Thomas Miller adds:

I think societies cycle between periods of optimism and pessimism, everchanging cycles, but man is basically optimistic or we wouldn't have survived this long. Investors also go through periods of optimism and pessimism, bull and bear markets, but as Triumph of the Optimists shows, the optimists win big over time.

Its important to identify the current mood of investors and follow the money. I think the optimists currently have the upper hand. People seem to say there are a lot of things to worry about, but it doesn't seem to be negatively affecting their investment habits as charts of the major indexes show. Aren't bull markets supposed to climb a wall of worry? As for current entertainment, the horror movies and others mentioned may do well, but I think the positive family movies from Pixar and Dreamworks do even better. I recall The Passion of the Christ did well, igniting something of a revival of Christianity around the world. I read that Hollywood, ever following the money, is set to make movies showing religion in a positive light. Not that long ago, many movies showed priests as psychotic devil worshipers, etc.

To paraphrase Sophie Tucker who once said, "I've been rich and I've been poor; and rich is better." - I've been optimistic and I've been pessimistic; optimistic is better.

More writings by Victor Niederhoffer