In 1929, Joe Kennedy got out of the market when his shoe shine boy started giving him stock tips.

That is what he said publicly, but, according to this, he had insider warning that gave him advance notice of what was going to happen:

Excerpt from Chapter 23 of The Creature From Jekyll Island:

Mellon (Secretary Treasury) was even more
emphatic. Herbert Hoover described Mellon’s views
as follows:

John D. Rockefeller, J.P. Morgan, Joseph P.
Kennedy, Bernard Baruch, Henry Morgenthau, Douglas
Dillon – the biographies of all the Wall Street
giants at that time boast that these men were
“wise” enough to get out of the stock market just
before the Crash. And it is true. Virtually all of
the inner club was rescued. There is no record of
any member of the interlocking directorate between
the Federal Reserve, the major New York banks, and
their prime customers having been caught by
surprise. Wisdom, apparently, was greatly
affected by whose list one was on

You can read the entire chapter here:

http://tinyurl.com/pup9of

also, see: http://www.ritholtz.com/blog/2009/05/mortgage-duration-risk-the-banks-are-no-longer-the-problem/#comments

and art’s in comments..

dh,

if the MSM followed of the “Trash Trucks” dumping their ‘impaired assets’ into the Landfill that is Frannie/Freddie–Phoney/Phraudie, somebody would have to do ’something’ about it/it’d be a photon-stream that would cast those ‘green shoots’ into a whole new spectrum of recognition..

I will go reluctantly… Looks like it will be just another Hollywood action movie. I guess I’m being parodied here:

http://www.theonion.com/content/video/trekkies_bash_new_star_trek_film?utm_source=a-section

I listened to a lot of your visit to Bloomberg Radio yesterday. I liked your take on W vs L uncertainty. Me too. I vacillate on both. I’m going to split the baby and converge it into a semi-W, the last leg up will look like a wavey, anemic check mark that is struggling with gravity.

Disagree on oil. The consumer might drive off on vacation if speculators weren’t driving up the price of gas while a glut of oil exists. That theory sounds more like a sales pitch you bought into than solid economic logic. Given your astute insight into employment, I don’t think you understand what passes for the middle class any longer and find that surprising. The oil thieves are just working another wealth transfer and Uncle Stupid won’t step in. For some idiotic reason, Uncle Stupid can’t find speculation in the oil markets.

I’m fascinated that the papers haven’t said much about Fannie Mae’s newest troubles. It need another $19 billion from Uncle Stupid and will need lots more in the future, or so it says. I suppose that doesn’t follow the current theme of less bad is really good. They’ll probably get the cash quietly, the MSM will ignore it and more idiots will ignore the frail state of the consumer economy and buy stocks. Whew, the higher it goes, the more it will look like that big 2008 dip when sanity returns.

Is it true that risk, ie big leverage, is financing a lot of the run up now? If so, whatabunchofdumbasses.

In 1929, Joe Kennedy got out of the market when his shoe shine boy started giving him stock tips. Maybe it’s time to head to the airport and get my Nikes buffed up.

Regarding Rosenberg, obviously he is dead on regarding the state of the economy. (thanks for posting the link)

However, the economy’s correlation to the stock market is always tenuous. The last recession ended in less than a year, yet the bear market dragged on for an additional 12 months.

If you are looking at macro factors and their impact on the markets, something worth considering is that, during this bear market, we had a genuine crisis of confidence.
The market is a discounting mechanism – I think we can agree on that – and the nastiest part of this bear was the market pricing in a complete absence of trust in a system that can’t function without it.

I think we can safely say that confidence is making a comeback. Apparently the stock market thinks it is worth something.