Finding the Sentiment: Do the Market Moves Make You Greedy or Fearful?
Lots of things about the markets have changed, but human nature remains the same. How do you feel about the momentum?
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The stock market has been a passion of mine since I was 10 years old. At the tender age of 10, my late Uncle Sid taught me how to read the Wall Street Journal. Long before financial news on TV, I was fascinated with stock prices, symbols and the "game." When I look at a license plate, I see a stock symbol and not just random letters.
Reading the Journal was easier 63 years ago and a lot different. Most of the time, markets stories did not get a byline while today, nearly every story has a byline and sometimes two or more authors. Years ago, articles and regular columns quoted important players in the field who really knew what was going on. With the markets all electronic today, you rarely see a quote from someone who is really in the thick of things. Journalists cannot really meet these people as they are scattered all over the place. No meetings after the close at Harry's of Hanover. (Compliance regulations also have something to do with it.)
The financial news cycle is 24/5 and sometimes 24/7. Chat rooms, blogs and posts on Meta, X and elsewhere dominate trading. Five-day settlement is a thing of the past and same-day options are the rage. Physical banks are quickly fading away as are traditional brokers. Weekly or monthly market letters also seem to be a thing of the past as well. Retail traders used to be cannon fodder for Wall Street in the '60s and '70s, but today they are weaponized through Reddit and the likes of Roaring Kitty.
Do all of these changes make your head spin, or do you think you can make money like some newly-minted experts on the internet claim to do?
Have we come full circle from the depths of early 2009 when retail traders had totally given up on stocks?
Lots of questions, few answers.
There are some old sayings that come to mind:
Never confuse a bull market with brains.
This time it is different.
Technology changes. Companies change. Market structures and instruments change. But human nature remains the same.
People become greedy and ignore risk at market tops and they become fearful and risk averse at market bottoms. Are people greedy now and should we be fearful?
Now is the time and place (in the comments below) to speak up with your thoughts.
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