If things are so good, why did GE sell NBC?

Consumer sentiment been down so long it looks like up.

Even the token bear on Kudlow laughed at Depression, claiming the two-year Recession is over, never mind increasing unemployment claims (a reliable leading indicator, more so in Depression rather than Recession).

People who can’t tell what time it is made fun of Merrill’s former Strategist Rosie for missing a 65% March 2009 reflex rally. They forgot the -50% opening act in the 2007 to 2028 Big Market Decline Soap Opera.

Mathematically disinclined don’t know it takes a +100% recovery after a -50% drop to break even, much more if we include the 86% dollar decline since 2001.

So much for Jim Cramer’s latest Bestseller, Getting Back to Even. Somehow best sellers make more money for the publisher than the reader. Most, like How to Get Rich Quick Flipping Houses or Funds, end up on the bargain counter a year or two later.

In stunning disconnect on the same Kudlow Report episode, we were reminded of reality by LK good friend and toothsome guest Suzy Orman.

Her friends’ 20% down, 8 months of savings in reserve, $750,000 income property in Tampa Bay fell to $150,000 with no buyers. They are now without money, stuck with Florida recourse loans, wanting to declare bankruptcy.

We recall at the peak in the real estate markets she was emphatically telling everyone on PBS TV Specials: Real Estate is the best investment.

Tsk tsk tsk; disconnect.

We have better results when we rely on our own memory and wits.

Of course we hear vulture funds brimming with big cash or credit lines are jumping on distress sales, providing (fleeting) stats of recovery, while leaving the middle class backbone engine of our economy far behind, foreclosed, forgotten and unemployed.

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This entry was posted on Wednesday, December 23rd, 2009 at 7:17 pm and is filed under Market Psychology. You can follow any responses to this entry through the RSS 2.0 feed. You can leave a response, or trackback from your own site.