* * * 19991012 Tuesday

Unbelievable Y2K-DGI pap from some (alleged) portfolio manager named Kenneth L. Fisher of Forbes.com forum!

Comments?

Regards, Bob Mangus

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< http://discussions.wellengaged.com/we/forbes/fisher/y2kstreet/7 >

or(?)

< http://discussions.wellengaged.com/we/forbes?INPUT=PAGE=DiscussionPage&PG_DiscussionPID=1v0.200870852938808885456 >

Y2K on the Street Many of the pundits are predicting a techno disaster on New Years. What do you think will happen? Will Y2K cause Wall Street to rally?

<-- Go to Kenneth L. Fisher - Portfolio Strategy Forum

responses 1-7 of 7 | No Previous | First 10 |

# 3 of 7: by Robert Mangus rmangus on Oct 5, 1999 at 11:37 pm EDT * * * 19991005 Tuesday

Mr. Fisher,

I am not a "pundit." However, I have more than 30 years experience in the IT industry; 2 years working 4 separate Y2K projects at Ford (AS-400), Blue Cross/Blue Shield of Michigan (Win95-NT PC/LAN), DMC (IBM mainframe), and a mortgage company (IBM mainframe).

I assure you that blind acceptance of certifiably "false" self-reporting by corporate-statist entities about Y2K status and unviable contingency plans will prove to be the undoing of "advanced" economies around the globe.

Hitler was a "virus" on humanity that started in Germany and attempted to spread worldwide. On the other hand, the inevitable Y2K scenario is an unprecedented, denial-greased sliding window of event-horizon driven dates-certain "virus."

What differentiates the Y2K scenario from all heretofore socio-economic calamities is the very real prospect of global infrastructure collapse (power grids, telecommunications, water and waste treatment, financial, transportation). U.S. Air Force bases have been conducting basewide exercises--no small undertaking--simulating infrastructure collapse based on real Y2K intelligence.

For economists--Yardeni, excluded--to ignore the reality of Y2K consequences and inviable business continuation plans is morally repugnant.

At least during the depression and WW-II the infrastructure was intact for those that could afford it. Y2K is different.

It is not about repairing broken electric power/telecommunications cables caused by damage from a storm. It is about physically acquiring and replacing defective controller hardware/firmware components in a catch-22 mode.

Without the power grid--brownouts = blackouts; motors and electronics will burn up and/not function in either scenario--and telecommunications networks intact, it will be impossible to conduct remediation. The degree of difficulty is compounded astronomically by current geographical distributions of resources (human and physical plant).

Where is the sanity of ignoring the consequences of Y2K in economic realms when real businesses have allegedly poured billions of real economic resources attempting--too late--to solve the Y2K problems that cannot be tested in real-time until real functional clocks flip?

This attitude is unfounded and logically untenable by virtue of the lack of demonstrable Y2K IV & V disclosure and non-disclosure agreements by all guilty parties.

Regards, Robert Mangus

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# 4 of 7: by Kenneth Fisher Fisher on Oct 6, 1999 at 1:59 pm EDT For: # 3 of 3: by Robert Mangus [rmangus] on Oct 5, 1999 at 11:37 pm EDT

Dear Robert,

Thank you for posting to my Forum site. The phraseology in my column was precisely, Those who still fret Y2Ks market impact dont fathom the markets, and you simply should be dismissive of them all. That would mean you, dude.

Let me say that another way. While I dont know how much real world impact Y2K will or wont have, it shouldnt have any negative stock market impact and is much more likely to create a rally starting about November, maybe sooner, but, before 12/31/99. And I am simply dismissive of you. Of course, I may be wrong. I always know that. And I dont know all that much about IT (Information Technology) at all. But my market background tells me you dont have zip of a clue how markets work, regardless of what you do or dont know about IT.

The really, really nifty thing about Y2K that lots of us can agree on is when its stock market impact can be measured, for good or bad or zip. There is only a little time left. Soon it will be clear. Very clear. Youve said your piece. Ive said mine. Cool! Put your bets on the table baby and let the chips fall where they may. Money talks. Baloney walks.

See, after it is all over, Im still stuck in public and if Im wrong have to eat crow. My firms thousands of clients will be screaming at me. Forbes readers will be screaming at me. Forum posters will be screaming at me. You will be screaming at me. And thats cool with me. Ive been living this for a long, long time. Ive been living for 15 years with having to makevery, very public forecasts and know that I have periodic crow meals--and that if Im wrong too much and have to eat to much crow, Ill get wiped out of the public eye. And out of the business arena. Still, I have to state clear, blunt opinions or Ill get wiped out of Forbes before too darned long anyway for being measly-mouthed.

You on the other hand, can freely post to my forum and if youre wrong, slip quietly into your private life with no particular repercussion (other than maybe if Y2K ends up being no big deal off of Wall Street it may be hard to figure out exactly what you do next year for a livingand you may be or may soon get just a tad afraid and defensive about that). So, Im wondering: are you going to be back next January to either feed me some crow or come and eat some? My guess is you will be back if I have to eat crow but wont if you do. Care to make a date????

Ken Fisher

# 5 of 7: by Marc Roy Marc Roy on Oct 8, 1999 at 3:22 pm EDT Hi Ken,

I recently attended a presentation by Harry Dent ( The Roaring 2000s, author ) I am certain you are familiar with the argument about demographics driving everything and making even the markets predictable in the long run. I am interested in your opinion on this in general, specifically because he opined that Japan has little future because of their awful demographics. This seemed awfully simplistic to me.........

Best Regards,

Marc

# 6 of 7: by Kenneth Fisher Fisher on Oct 9, 1999 at 11:59 am EDT For: # 5 of 5: by Marc Roy [Marc Roy] on Oct 8, 1999 at 3:22 pm EDT

Dear Marc,

Thanks for posting to my Forum site again. Its great to have the Forum working again, because for about a week there you had to be Houdinis henchmen to be able to figure out how to get into here. It actually got fixed and working again about a hour before you posted. I hope you werent too frustrated previously.

To answer your question, a decade ago I placed great credence in demographics because almost no one was paying attention to demographic arguments then and the baby boomer generation was just about to come into peak earnings years. But, all my life whatever has happened to the baby boomers has become very, very noticed. It was Dr. Spock in the 1950s, Hippies and Vietnam in the 60s, yuppism in the 70s, new young conservatives in the 80s leading to Reaganism. So, as the power of maturing baby boomers rising incomes helped our economy in the late 80s and 90s, everyone started noticing after demographics impacted markets. But once folks started noticing it, by definition it lost most of its power over markets. I get this basic question from someone too regularly recently for demographics to now not be already fully discounted into market pricing. Demographics has become popular. Hence, while demographics is always a powerful force on main street, it is not now a force which should have a powerful force on Wall Street.

It is always amazing how few folks can fathom that if something is well known it loses power over markets. A well known but really stupid commentator and poor forecaster read my current Y2K column and attacked it on his website. Part of his attack was his claim that while the market is a discounter it doesnt discount things like Y2K because it doesnt know and cant know exactly what the outcome will be with Y2K. He quite articulately stated that he doesnt believe that the market moves in advance of events and that it actually does wait for them. Youve got to feel a bit sorry for the guy. My column said, Those who still fret Y2Ks market impact dont fathom the markets, and you should be simply dismissive of them all. Somehow he didnt understand that them all included him. Simply that he was coming back at me about it should have warned him up-front that I was going feed that sentence back to him. I put the sentence into the column in the first place as a trap for people like him. Hey, moron; that means you, dudedismissive means youre dismissed.

The power of the market to discount the things we discuss, even if we cant know exactly how they will turn out is one of the most certain forces in the stock market. I can only feel a bit of frustration and a bit of sympathy for so many folks who insist on engaging the market but cant understand this simple but point.

Ken Fisher

# 7 of 7: by Graham Munro Graham Munro on Oct 11, 1999 at 8:49 pm EDT Ref: #6

"The difficulty lies, not in the new ideas, but in escaping from the old ones"

(Quote from John Maynard Keynes in his 'General Theory of Employment, Interest, and Money')

-- Robert Mangus (rmangus1@yahoo.com), October 12, 1999

Answers

The arrogance is palpable.

Glad to know that he's focused on that next rally!

People like Mr. Fisher will be blamed for the (soon and certain) decimation of this country's middle class. It won't really be his fault but rather America's collective greed and arrogance. Let's just hope he's not around when the angry (and impoverished) mobs are looking for a scapegoat. 'Eating crow' may be the least of his worries.

Pray that the coming depression brings repentence and revival. That is, in my opinion, our only hope as a nation.

-- TrustHim (ItComes@Soon.now), October 12, 1999.

Whoa....Aaaaaaah...what'd he say?

His message board was down for a week....had to be a "Houdini" to get in???

He'll be lucky to eat crow in 3 months...heheheheheh

You don't understand how markets work... to be honest, I don't either, but I do know how "Tulip Mania" works

"a decade ago I placed great credence in demographics because almost no one was paying attention to demographic arguments then"

This guy needs to build a bridge and get over himself...

I think he'll easily make the transition. The question is: Does he open the window before he jumps, or not.

By far the most funniest thread tonight...

-- Nailbender (LOL@midnight.net), October 12, 1999.

Guys like Kenneth L. are, by keeping the stock market DGI, acting as sacrificial machine gunners for us suvivalist types and don't even know it. Ken, the brown icky spot your body leave behind won't be forgotten any time soon--believe me.

-- Ocotillo (peeling@out.===), October 12, 1999.

I have rarely seen such arrogance as this gentleman's. The market will come down. Daytraders know it (evil as they are) they know it. The deal is, the market will come back.... someday (maybe well over the rainbow) but it will come back. So for those with accumulated wealth that don't need it anytime soon, staying in the market may not be devastating. But for those that might depend on the market as a manager of liquid assets that may be needed, well..... good luck.

And all of this doesn't depend solely on Y2K but how the "global" economy will treat the U.S re: import/exports and the dollar in the future following Y2K which is still a big unknown to me.

To a certain extent, I see his side (barring his arrogance). If I managed thousands of accounts, I believe I might very well put blinders over my eyes too. The potential devastation to wealth is totally mindboggling. I think I would change careers.

-- the Virginian (1@1.com), October 12, 1999.

Lessee Robert, Ken says you don't know nothing bout markets and are a moron, yet Ken knows nothing bout IT but can dismiss IT y2k concerns re markets. Because he knows markets.

He obviously doesn't know much about how the world works, nor did the manners and civility that boy's momma taught him stick.

-- Mitchell Barnes (spanda@inreach.com), October 12, 1999.

Arrogance indeed!

This guy thinks markets are predictable. How can a market discount uncertainty? What he says pretty much indicates to me that the market will crash soon, if it is so omniprescient.

Anyway, if he wants to talk in absolutes - there are none. Forget markets, forget IT & Y2K - one day it will all be gone and I mean ALL of it. We'll all be dead, civilizations will be dead, the empire state building & golden gate bridge will be rubble. Everything has a birth, life and death. Eventually the world will end and the universe will end. But before this, the NYSE will not only crash, but will be nonexistent. Period. See how the market discounts that, you "absolute rule of the market - never to be broken" idiot.

Also, why would the markets have already discounted Y2K? Is there a minimum time frame that I'm not aware of? I mean, he can still be right - just wait and see the market reaction in December. For Y2K, I'm sure the lead time for the markets will be short, as all the DGI's and denialists panic.

-- Jim (x@x.x), October 12, 1999.

From TheStreet.com:

Midd ay Musings

...Despite the negative day, Steve Shobin, chief technical analyst at Lehman Brothers, reckons the market isn't about to revisit its recent lows -- at least not in the near term.

"The broad averages have been able to shuck off a heck of a lot of bad news in the past few weeks," he noted. "GE (GE:NYSE), our favorite bellwether, was able to make a new record high. And financial stocks have shown a little stability lately."

Given those positives, Shobin thinks the market is in for a thinly led rally that will last somewhere between four and eight weeks. Yet he worries that the real market correction is yet to come.

"There seems to be a lack of fear," he said. "There's concern -- no doubt about it. But investors lack fear. Corrections only end when people capitulate. When they throw in the towel."

For his part, Ginzburg thinks there's enough uncertainty in the market these days that playing either way can get you in trouble.

"You have a profit, you take it," said Ginzburg, who figures that when the market does break out -- either up or down -- it will break out big. "There won't be a bid to hit or a bid to take." Nothing to be caught on the wrong side of.

"There's no reason to kill yourself here," he said. "There will be plenty of time to make money."

-- Mac (sneak@lurk.hid), October 12, 1999.

This guy is a buffoon. He probably has investments at stake and is talking them up, sorta like Martin 'the billion dollar rip off artist' Armstrong from Princeton Economics Institute.

-- OR (orwelliator@biosys.net), October 12, 1999.

One wonders whether Mr. Fisher (Wall Street maven and champion of The Glorious Market that he is) is/was a supporter of good ol' "Chainsaw Al" Dunlap:

Chainsaw : The Notorious Career of Al Dunlap In the Era of Profit-At-Any-Price, by John A. Byrne

From Amazon.com's review:

Al Dunlap was so ruthless in downsizing corporations for short-term shareholder profit that he earned nicknames such as "Chainsaw Al" and "Rambo in Pinstripes." Wall Street loved Dunlap at Scott Paper, where he laid off thousands, but then hated him at Sunbeam, where he himself was finally fired. Chainsaw, by Business Week writer John A. Byrne, dramatically documents the rise and fall of Dunlap, the havoc he wreaked on companies and people's lives, and how he came to power in the first place.

"Chainsaw Al was a creation of the Street and its ceaseless lust for profit at any cost. He came of age when the market routinely rewarded layoffs with lofty stock prices. The more people he tossed out in the street, the higher stock values went," writes Byrne, who cites "cutthroat investors" such as Michael Price and Ronald Perelman for helping Dunlap's rise. Superbly written and researched, the book vividly describes characters and scenes, and reveals the fictions that Dunlap told about himself.

How cold was Chainsaw Al? Byrne writes that Dunlap never even attended the funerals for his mother and father. Byrne also tells the story of the questionable accounting and business practices that ultimately brought down Sunbeam and Dunlap, and the investigations that led to a restatement of the company's finances. Dunlap, unhappy about Byrne's reporting, once said of the Business Week writer, "If he were on fire, I wouldn't piss on him." It's a quote that Byrne uses to kick off his last chapter. Chainsaw is a compelling read for those interested in the inner workings of Wall Street and business, or just a well-told story. --Dan Ring

Anyone remember some of the jokes that made the rounds during the last "market correction"? Here's one:

Q: What do you call a stockbroker nowadays?

A: Oh, waiter!

-- Mac (sneak@lurk.hid), October 12, 1999.