An Antidote for Wall Street’s Churlish Tedium

[Spring has sprung, the daffodils are blooming even here in Boulder, and meteorologists are saying that Punxsutawney Phil may have erred last month when he saw his shadow. If you’ve failed to notice all of this because the churlish tedium of Wall Street has occupied your days, then perhaps it’s time for a getaway. Consider the benefits thereof, described below. I have previously run this excerpt from Thomas Mann’s The Magic Mountain because it holds an epiphany concerning the way in which we experience, and later recall, the passage of time.  My very favorite selection from one of Western Civilization’s greatest novels,  it can be found in the “Excursus on the Sense of Time” chapter. The translation is by H.T. Lowe-Porter. RA]

“There is, after all, something peculiar about the process of habituating oneself in a new place, the often laborious fitting in and getting used, which one undertakes for its own sake, and of set purpose to break it all off as soon as it is complete, or not long thereafter, and to return to one’s former state. It is an interval, an interlude, inserted, with the object of recreation, into the tenor of life’s main concerns; its purpose the relief of the organism, which is perpetually busy at its task of self-renewal, and which was in danger, almost in process, of being vitiated, slowed down, relaxed by the bald monotony of its daily course. But what then is the cause of this relaxation, this slowing-down that takes place when one does the same thing for too long at a time? It is not so much physical or mental fatigue or exhaustion, for if that were the case, then complete rest would be the best restorative.  It is rather something psychical; it means that the perception of time tends, through periods of unbroken uniformity, to fall away; the perception of time, so closely bound up with the consciousness of life, that the one may not be weakened without the other suffering a sensible impairment. Many false conceptions are held concerning the nature of tedium.

“In general it is thought that the interestingness and novelty of the time-content are what ‘make the time pass’; that is to say, shorten it; whereas monotony and emptiness check and restrain its flow.  This is only true with reservations. Vacuity, monotony, have, indeed, the property of lingering out the movement and the hour and of making them tiresome.  But they are capable of contracting and dissipating the larger, the very large time-units. to the point of reducing them to nothing at all. And conversely, a full and interesting content can put wings to the hour and the day; yet it will lend to the general passage of time a weightiness, a breadth and solidity which cause the eventual years to flow far more slowly than those poor, bare empty ones over which the wind passes and they are gone. Thus what we call tedium is rather an abnormal shortening of time consequent upon monotony. Great spaces of time passed in unbroken uniformity tend to shrink together in a way to make the heart stop beating for fear; when one day is like all the others, then they are all like one; complete uniformity would make the longest life seem short, and as though it had stolen away from us unawares.  Habituation is a falling asleep or fatiguing of the sense of time; which explains why young years pass slowly, while later life flings itself faster and faster upon its course.

Re-Experiencing  Youthfulness

“We are aware that the intercalation of periods of change and novelty is the only means by which we can refresh our sense of time, strengthen, retard and rejuvenate it, and therewith renew our perception of life itself. Such is the purpose of our changes of air and scene, of all our sojourns at cures and bathing resorts; it is the secret of the healing power of change and incident. Our first days in a new place, time has a useful, that is to say, a broad an sweeping, flow, persisting for some six or eight days.  Then, as one ‘gets used to the place,’ a gradual shrinkage makes itself felt.  He who clings or, better expressed, wishes to cling to life, will shudder to see how the days grow light and lighter, how they scurry by like dead leaves, until the last week, of some four, perhaps, is uncannily fugitive and fleet. On the other hand, the quickening of the sense of time will flow out beyond the interval and reassert itself after the returns to ordinary existence: the first days at home after the holiday will be lived with a broader flow, freshly and youthfully — but only the first few, for one adjusts oneself more quickly to the rule than to the exception; and if the sense of time be already weakened by age, or — and this is a sign of low vitality — it was never very well developed, one drowses quickly back to the old life, and after four-and-twenty hours it is as though one had never been away, and the journey had been but a watch in the night.”

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  • mario cavolo March 23, 2012, 3:59 am

    Rich et al…

    Hmm? Has the equities market, any equities market, ever “look at below” crashed in a zero interest rate environment? Of course that’s just one factor of many influencing the value of asset sectors across the economy, but still I’m thinking its a good question… (Japan?…continually declined for years and years with low interest rates?) ….

    Cheers, Mario

  • Robert March 22, 2012, 11:50 pm

    “Time is the fire in which we burn…”

    -Delmore Schwartz

    • mario cavolo March 23, 2012, 3:30 am

      oh that’s really good…

  • Rich March 22, 2012, 9:30 pm

    Speaking of deflation, we just posted news of an oversubscribed -.89% Ten Year TIPS auction that confirms it.

    People are so afraid of risk they are willing to take a negative yield for ten years with an inflation hedge.

    Look out below amigos…

  • Bradley March 22, 2012, 8:56 pm

    Das the truth, Ruth.
    (I mean Gary…)

  • Rich March 22, 2012, 7:16 pm

    We bought April 139 SPY puts on the New Moon.

    We plan to ride the rails for a month to avoid a possible 33-foot tsunami on Lake Tahoe predicted by the UNR Geology Dept.

    Those strange sounds have been heard all over the world, suggesting some serious seismic shifts may be in the works.

    We still do not trade the market as well as Rick.

    The proof’s in the profits.

    LaRouche EIR, to which Bill Casey and Ronald Reagan subscribed, calling for 0’s removal from office to prevent thermonuclear war:

    http://larouchepac.com/

  • Mark Uzick March 22, 2012, 5:47 pm

    Yes, time is the dimension that measures “potential for change”, but we perceive it as actual change; without change, we cannot perceive time and so it doesn’t seem real.

  • RichardB March 22, 2012, 4:30 pm

    Look for a major scandal to break when punxsutanwney Phil is implicated in an insider trading scheme. Of course, he will deny knowing anything about it and the regulators will be more concerned about lawsuits than where the missing weather went.

  • gary leibowitz March 22, 2012, 4:20 pm

    I am afraid you suffer from the same ailments that Rick does.

    Personalize what should be objective market analysis. Perhaps this is why Warren Buffett has consistently done very well long term. People take a position and believe they must defend that position. Pride should be replaced with humility. When driving a car do you try to beat out a traffic light knowing that one block further the light will be against you? It’s also a matter of patience and risk aversion.

    I think Rick has a very nice and proven technical system. I also believe most of us don’t take an analytical approach to maintain our objective. When we project our bias against these technical systems they become skewed. When we anticipate a market trend while using technical analysis, it can lead to disastrous results. The system you have developed should dictate your trading behavior. Your bias on market conditions should be discarded totally.

    I suffer from the same ailments. It is easy to put on a chart your technical and fundamental views, listing each component and its weighted importance. It’s also easy to keep track of the list and place a buy or sell recommendation based on the numerical results. But 99 percent of us do not use such a system. It’s not because it is flawed or hard to do. The only reason I can think of is because it will interfere with our prejudices. We take pride in our emotionally dogged views and do everything possible to maintain these views no matter how well it parallels the markets path.

    • Rick Ackerman March 22, 2012, 9:25 pm

      Gary, you haven’t taken the Hidden Pivot course, nor have you followed the detailed trading recommendations that I disseminate each day to paying subscribers, and so your impression of Rick’s Picks is likely to be based on the free commentary published daily at this site. However, and as any one of my subscribers would tell you, I focus obsessively on trading and forecasting strictly by-the-numbers. ‘Bullishness’ and ‘bearishness’ aside, for me and many ‘pivoteers,’ it all comes down to observing uptrending or downtrending impulse legs in different time frames.

      This very simple idea guided me unfailingly during a time when I might otherwise have stumbled badly. In the weekly column I wrote for the San Francisco Sunday Examiner years ago, I dissed the dot-com boom as it played out, never deviating from the shrill warning that this hysterical eruption of greed and stupidity would take many investors down with it. The Examiner‘s readers must have seen me as Chicken Little (until the crash, that is). However, at that same time, the customized daily forecasts that I was selling to groups of floor traders on the CBOE and PSE made even Merrill Lynch’s analysts look like pessimists. Moreover, Hidden Pivot analysis proved ideal for pinpointing swing highs and lows in the stocks that moved most violently: JDSU, Qualcomm, Broadcom, AOL, Yahoo, et al.

      Years later, writing about the deflationary juggernaut that I believed (and still believe) will destroy the global financial system, the Dow was trading below 10,000, seemingly in the throes of a seven-year topping process. And yet, from a purely technical standpoint — the DJIA having created a bullish impulse leg on the daily chart — I had to acknowledge that the blue chip average looked like it was staging for a rally of more than 4000 points. That was hard for me to believe, especially since the banking and housing disasters I had been predicting for years had yet to occur. Ultimately, I stuck with the charts and they never steered me wrong.

      Even now, with a catastrophic credit collapse still looming and housing prices only halfway to the bottom I’d forecast more than ten years ago, my daily numbers for the broad averages have been delicately in-synch with each new upthrust. And although, like every permabear, I have a jones for trying to catch the Mother of All Tops with a perfectly timed short, and for playing chicken with the bullish herd, I continue to attempt this — most recently with a 1412.75 short recommendation in the E-Mini S&P — only in ways that would subject subscribers to minimal risk. (In fact, most of these “failed” shorts have made a profit on paper, although the most recent of them looks unlikely to trigger because the so-far high fell a few points shy of my rally target.)

      • Rich March 22, 2012, 9:50 pm

        Looking for nominal 1% negative mortgage rates before this is All Over Baby Blue…

        http://www.youtube.com/watch?v=ziQx0cXV4nY 5:47

      • gary leibowitz March 22, 2012, 10:32 pm

        You are correct. I have only based my observation on your free advice. You have also alluded to the notion of trying to catch the top. Yes I have done that over and over again but can tell you it only distracts from making clear objective decisions. I think of all the opportunity wasted all the years “I” have tried to anticipate the top. I obsessed over the fact that the market is doomed to fail therefor it must fail soon.

        Let me put it to you this way. If you were of the opinion that the economic conditions are ripe for a huge rally this year how different would your calls be? Would you for instance stay away from bearish setups and concentrate on technicals that indicate a possible large move higher? Surely our bias on the market trend plays a role in how we interpret the technicals. On a risk reward basis wouldn’t you try and stay with technical moves that go with the trend as opposed to against? Would you filter your trade putting more weight on a move that goes with the general trend as opposed to against?

        If I am all wrong about your decision making then I apologize. Based on my own experience I have gone against the market trend anticipating a reversal instead of playing the safer bet.

      • Rick Ackerman March 23, 2012, 1:17 am

        Gary, most of those who frequent this forum do not share your view that “economic conditions are ripe” for a big rally. To the contrary, we believe the economy is so deeply and dreadfully sick that only a financial collapse can set it back on a path to health. I gather that you agree, even if you doubt that the collapse is imminent.

        At a more fundamental level, we disagree over whether “the economy” and the stock market are even connected. If so, it would seem that the relationship is neither rational nor predictable. What seems most obvious, if not to say indisputable, is that stocks have been responding to an unprecedented, global surge in credit money. In point of fact, nearly all of it, including a derivatives market with a notional value estimated at just under a quadrillion dollars, is wholly imagined. It could vanish in an instant — and inevitably will.

        In the meantime, we shouldn’t kid ourselves about the wisdom or value of trading on ‘fundamentals,’ since they are rooted in statistical legerdemain and subject to wildy exaggerated interpretation by Wall Street’s permabullish sales force. Charts, on the other hand, have the singular virtue of reflecting only what is

  • BigTom March 22, 2012, 5:34 am

    “There is, after all, something peculiar about the process of habituating oneself in a new place, the often laborious fitting in and getting used, which one undertakes for its own sake, and of set purpose to break it all off as soon as it is complete, or not long thereafter, and to return to one’s former state.” Now here’s a thought. What if ‘they’ in this above quote turn out to be those who arrive at the new and beautiful then turn it into the befouled nest they had just left behind once they move in next door to the indigenious? Oh, methinks this hallowed market must soon mend ‘thyself’ else I become too ponderous for even myself!