Aug

14

Everything you need to know about markets you can learn at rock concerts. From a combination of circumstances, I had the good fortune to attend five rock concerts in the last few weeks with my young son Aubrey, and I have learned so much about markets from each of them that I could write a book about the lessons. If only I had learned these lessons before! When you go to the concerts, the rules are the key. I've found scalpers outside of each, and the prices are always considerably less and the time saved considerably more valuable than the tickets themselves. At first I made the mistake of going to these concerts at the stated time, but I found that the main act always goes on at midnight, and all the preliminary acts, like the undercards on a boxing match or the picadors at a bull fight, are meant only to whet the appetite. Similarly, the market activities before the open are all a facade to get you in, and the main events happen well into the show, usually at the encore, when the audience thinks the game is over, but then the stars play their main song.

YahuI knew that I was going to learn much from them when I attended a Matisyahu concert with Aubrey which I thought was going to be an Asian show. I couldn't understand the language but was surprised to see half the audience in yarmulkes. I asked one of the tens of thousands in attendance, and he told me the language was Yiddish and Yahu was very sagacious and his Yiddish rap contained much sentience. He then opened his arms like King Canute by the sea and asked the audience if it was time to jump in. A frenzy occurred and 25 security guards rushed to the middle and he jumped in, much to Aubrey's delight. "He just jumped right into everybody and they're carrying him on their shoulders." The frenzy is exactly like the POMO that is so current these days with the preannounced $1 trillion that they're going to buy coming every few days, with $7 billion here and $10 billion there, with the cash that's coming in being available for 20 to 1 leverage buy equities. The effect is the same, with much good music coming afterwards with a z of 1.5 or so, but many people getting hurt as they try to stampede in to pass the star down the line. Of course the scholarly Yahu is a stand-in, art imitating markets, of the scholarly Israeli market that exactly foretells the opening on Monday with its Sunday moves and is generally accurate as to what is going to happen in New York from 11 a.m. to the close with its early Israeli close, as presumably they read our mail and don't want to be caught in a state of detallises.

We went next to a TV On the Radio concert which was almost as frenzied as the Yahu one and Aubrey was the only one who liked the music because it was exactly like the amplified electronic beeps that his switch-on electronics for 2-year-olds plays, with no harmony or timbre to it, but strictly rhythm and tones. It's apparently just as much the rage as the Yiddish rapper and of course its the analogue of the electronic algorithms' robotic activity that currently dominates futures and individual stock trading. The best sounds came during the 1 1/2 hours it took each group to set up all their equipment, and I guess the group with the best amplifiers and lighting is the most favored the same way the robots near the exchange and the "banks" that have their debt guaranteed by the Fed so they have all the capital in the world to shake out the mere public who don't have the electronics or funds to compete with them.

I next attended a Don McLean concert and heard his song American Pie, which reminded me so much of all the trendfollowing books that I've read which did so much good 50 years ago and have been voluminous though completely out of date since. Apparently McLean was once a great, and had a hit song, the same way the large man once made a fortune by buying beans on the way up and shorting them on the way down.

Regrettably I did not get to see the pre-concerts of Michael Jackson although my daughter Katie once attended his father's 50th birthday party and got a private showing of the zoo when I was a star. Jackson was once a great, then lost everything and had as his best friend a chimpanzee, and liked to dress up funny and play with youngsters. He was in eclipse a non-entity, but then when he died, he became the most loved and revered of them all. My goodness, I heard this exact story before. Morse is back. He first was famous for bulling up Trolley and Canal in the 1870s but then lost everything in the panic of '77 when Livingston got his start. But then he was a ghost. Still he was spotted while a ghost walking down Wall Street and Radio immediately went up 15% thinking that Morse was back. Well, you get the picture.

I also went to Frankie Valli but he only performed after midnight the same way you have to wait for the close these days to have all the big boys try to switch you out. I'll report on the other rock things I went to, and quantify a few of these things after I get readers' insights.

Steve Ellison adds:

CornI saw REO Speedwagon and Styx last month. REO played first, and apparently many of the holders of the most expensive reserved seats right in front of the stage were Niederhoffering. The section was nearly empty. After a few songs, Kevin Cronin said that he hated singing to empty seats and encouraged others to move forward. However, he had not consulted security. Within minutes, hundreds of people were moving forward, but ushers blocked the aisles, only allowing those who had tickets for the front rows to enter. An analogous event occurred two weeks ago when corn broke above its 10-day high at 340 and moved up to 376 within two days. Alas, the hopes inspired by the breakout were dashed as the price collapsed to below 330 by the end of last week.

Allston Mabry asks:

Ever consider taking young Aubrey to one of Levon Helm's Midnight Ramble shows up in Woodstock? You'd both get a kick out of the rustic intimacy of the barn ambiance, and the music is sublime. At turns, hues of rock, jazz, country, and classical, all in one evening. It's a unique venue and vibe, and the lineup of artists that regularly perform there is a joy to behold. Great spot, cool town.

GM Nigel Davies reflects on performers' reputation after death:

The taboo about not speaking ill of the dead works very well for controversial characters, except of course that they're no longer around to enjoy it. And when there are direct beneficiaries from the sales of the controversial one's products some new dynamics come into play, the thought that the death of the controversial one would considerably enhance sales (I bet many in the Jacko camp considered the possibility these last few years) resulting in extreme guilt (and ever greater praise) should that actually happen.

It surprises me that there hasn't been at least one known (to me) example of an over-the-hill celebrity faking their deaths and then channeling their funds to a new incarnation as this is such a genius career move.

GM Davies is the author of Play the Catalan, Everyman, 2009

Andrew Moe reports on his concert-going experience:

On their current US tour, Coldplay moves from the main stage to several smaller stages positioned well out in the cheaper seats of the venue. In San Diego, they went so far as to set up shop for a few songs at the base of the lawn area that lies behind the assigned seats.

During a particularly engaging number, one observed security quietly clearing a path from the main stage. As the lights went out, the band quickly and easily moved through the packed venue. Once their new positions were established, on went the lights and the crowd went wild. Reminds me of the clearing of the way for certain banks to take positions they later flip to the government for immense profits.

Traffic patterns in and out of a concert offer the opportunity to study drivers under pressure in an unfamiliar environment. This is quite different from the regular commute where a fair percentage of the drivers know both the route and the daily tendencies. The best opportunites in markets come when you have a group (or groups) in unfamiliar territory reacting to intense pressure.


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