May, 1998

I've got a pretty long memory but can't remember a time when there was so much nervous wealth. Not a day passes without some new jitter in the financial pages. The Dow lunges ahead at speculation interest rates will not rise, then falls on the merest whisper of hint that it might. We're all edgy, long-tailed cats in rooms full of rocking chairs. No one's having any fun and getting rich is supposed to be fund.

Thin ice, yeah. Jitters, everywhere I look there's jitters.

Market pundits, those always under thirty-fivish lads with warm grins are running for cover in technical language. Scares me when I think about it too long 'cause technical language is a sure sign they don't know what to make of it either. Never has there been so much angst in acquiring wealth.

Well, except for maybe that one time about seventy years back and no one's gonna draw parallels with that. That market was built on borrowed margin money and fueled by individual hysteria. Everyone then was betting the farm and betting the farm is a sure-fire way to become a city dweller. This market is different, this one is awash in real money from pension funds. My money from my pension fund is in there some place as well and that makes me mildly hysterical. But what can I do?

No one thought seventy year-ago market could stumble and everyone thinks this one should have already. And it may.

I'm not in it for the earnings, maybe you're not either. Who could be when average prices are out there in the stratosphere near thirty times earnings? I'm not really in it for the growth either, 'cause I'm afraid the growth has been too fast for too long. It feels like the late innings to me. Jittery, yeah I'm jittery.

I'm in it 'cause there's no place else to go.

What am I gonna do with my 401-K money? Put it in Treasury Bills at four or five percent? Just like me, the investment trusts and pension plans and drug dealers and foreign nationals just keep pouring money into the only game in town. Wall Street is awash in tides of money.

Too much money chasing too few stocks.

My old daddy used to say that the market was made up of sheep and those who shear the sheep. But that was in the bad old days, those ancient times before Washington laid the rules that laid the golden egg. Doesn't look like there's gonna be a shearing, at least not in the classic style of my daddy's day. A few ups and downs perhaps. No shearing.

Partly in its terror and inability to deal with where social security was headed, the cool heads in Washington created a whole bunch of tax-free or tax-deferred retirement plans. They were essentially a good deal for rich folks, but whaddya know? You and I and all those worker bees out there came a-swarming.

We brought our little fistfulls of cash and all that sudden money came lookin' for a home. Somewhere you and I and the rich folks could generate the tax-free, tax-deferred income that Washington had promised like a five cent lunch.. And where else was there to go for that lunch but the stockmarket? Wall Street was there with open arms and a cash bar.

A new brand of star was born. Just like Randolph Scott, the money manager swaggered into town with a tin badge and a gun on his hip. These guys have more followers than Tiger Woods. These guys are brand names. Their 'teams' are judged on the financial pages, their won-loss records compared by endless swarms of bees looking for the sweetest hive.

So why am I so nervous? Why such dark humor at cocktail parties and the occasional reach for the Prozac? I tell myself there'll be corrections, a drop here, a precipitous drop there. I tell myself if there's a danger it's in the lightning quickness with which huge amounts of money can suddenly leave for greener pastures. Myself is reasonable and agrees that if there's a safety-valve, it's that the huge funds are controlled by calmer heads than mine. I look in the mirror and hope for that and myself hopes back.

Stock prices aren't as attached as they once were to earnings. Randolph Scott will forgive even a loss, as long as it's forecasted, as long as it's not a surprise. Randy hates surprises. Some of these young money managers have never faced a loss. How will they deal with that? Glamour is the replacement for earnings and so there's a feeding-frenzy of acquisition, cause it's glamorous. Two can live as cheaply as one. Redundant employee begone. Tweak the glamour, set the glitter-ball to twirling.

Corporate disco---the move to be the hottest, hippest spot in town.

In the midst of this controlled chaos, the congress is actually considering investing a portion of the social security fund in the stockmarket. Now there's a laugh. Bad idea in a market already overburdoned with cash. Good idea if you want to see stocks trading at forty times earnings. Not to say that Joe CEO at Corporate America wouldn't love to see that happen ---a higher tide of money with which to go shopping for mergers. All those creamy stock options getting creamier. Another source of growth without pain, without those messy assembly-lines, without actually having to make a better widget.

Better widgets are hard to come by.

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