Mental Conditioning

by Johnny Debacle

Everyone uses the phrase killing it and the bear market version “[fill in the blank return] is the new killing it”. But I have to be honest…when I look at the market, and the S&P 500 is only down say 5 points, my mental accounting puts that in the win column. That’s tantamount to a rally, hell it’s not tantamount, it’s mount to a rally. When I hear “oh the market is up 5 points”, I think in my head “It’s only down -5 points, I barely even understand what that means” and then I freak the hell out.

The turns and spins and dives and rises of this market have been like a baptism in biasfire. I feel every single dumb bias at different points in a day. Loss aversion, mental accounting, regret minimization, anchoring, representativeness, overconfidence, everything, a veritable CFA clinic on biases. I am that clinic.

And I wonder — is this how scientologists are made? They heat up the room, assault you with information overload, starve you, break you, push all your preconceptions, tear them down, question you, make you question yourself, have Paulson or Geithner say something officially vague and stupid, make you agree with them and eventually, with Xenu. Market I agree with you! Tell me what you want! I will do it!

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  1. March 10th, 2009 | 2:11 pm

    Marry Erin Callan and spawn a devil-mate for Suri who emerges from the chrysalis of your barren womb, butterfly like, wearing french cuffs and playing brick breaker.

    Then we all shall rise again.

  2. Pleb
    March 10th, 2009 | 3:09 pm

    Johnny, get a grip, will ya? The market is booming today. Booming! It’s up nearly three hundred points, almost to 1994 levels! (Of course I’m looking at the Dow which is like extrapolating the health of Springfield residents from the results of C. Montgomery Burns’ biopsy, only probably less accurate… but still…)

    Of course it’s going to drop like a stone in a day or two when the memory of Citi’s “but I’m not dead yet” memo fades, but who cares? This is your chance for a brief respite. Go out and party your ass off tonight like the mini-baller you are, with some Christal baby-chams and some mid-priced hookers. Yeah baby… we’re gonna party like it’s 1929!

    Okay, maybe it isn’t a great lifestyle or investment strategy to do any of that, but you can ameliorate the hangover tomorrow AM by shorting the shit out of the Citi stock you picked up today, so even though you got skinned by buying “high,” at a buck thirty or so. You will have made 10, 15 cents a share. Appreciate it for what it is – profit! I recommend off-loading Citi pre-opening, which won’t make you any money but the joy at watching late-sellers tear their hair out at 9:45 (98 cents, suckers!) will make you feel damned good.

    As a lawyer I know jack shit about the markets, which makes me at least as qualified as the President to tell you how to manage your money.

  3. March 10th, 2009 | 4:08 pm


    If you started a blog, I would stop reading one of the blogs I only sort of am in like with to make room for yours. Hilarious.

  4. March 10th, 2009 | 4:12 pm

    Pleb, I have it on good authority that what she really means is that she is a virgin but upon reading your wit on the internet, she now wants to be made a woman. By you.

  5. Pleb
    March 10th, 2009 | 9:10 pm

    I get that “make a woman of me, Pleb” thing a lot, Johnny. Unfortunately, it’s only because I practice unlicensed gender reassignment surgery in my off-time, or at least I do when I’m not too busy huffing nitrous and glue. Hey, don’t pass judgment. The economy is tough right now and it helps to have a hobby, and a second job.

    And Girl, thanks for the compliment. If I ever start a blog I’ll let you know so that you can web stalk me, and shun some other mediocre blog in favor of my mediocre claptrap.

  6. March 11th, 2009 | 12:23 pm

    @ JD the state of my arcane flower is a rather private matter, and one that I would appreciate be relegated solely to the e-bay auction in which I intend to sell it (for educational purposes only).

  7. March 11th, 2009 | 1:29 pm

    Pleb, we would be honored to be that “other mediocre blog”. We have long aspired towards mediocrity, not unlike the post office, the US auto companies and public school education.