More Art. Downstairs on the plinth in the atrium between the escalators and the trendy coffee shoppe. Near the pub. Which is why I came to notice it. A bronze bull buffalo. On wheels. With two begoggled and horned (really!) stick-thin maidens perched astride its ample back. No reins or visible means of control. No motor connected to the wheels. This buffalo can move only one way. Downhill. Strong symbolism here. Naïve investors riding a bull market? Hmm.
It’s not the intention of this piece to list the crises and joys of the past week in the market. I hope now and again to make a remark that may help you follow what could be taking place. In front of me I have a number of home-grown models and screens that try to summarise and characterize the deluge of numbers. However, it is, of course, quite useless and probably irritating to be told that a certain index has moved here, when one’s share holding – which in all likelihood is a member of that very index – has travelled, very convincingly, there. Despite having made a career speciality of describing index historical returns, I must admit to knowing deep down that that sort of info is pretty useless. What we all need to know is what is going to happen.
As I have mentioned before, there is now a growing body of research that is coming to the same conclusion that we physicists have always known. That the future is unknowable and in systems like the markets, the next move is randomly up or down. Certainly there are examples and strategies that seem to contradict this observation and I myself have a fondness for trying to use financial ratios to identify relative value. It’s difficult to accept that all one’s experience and skills are inferior to plain blind luck! All “proper” research carries a warning along the lines that past performance is no guide to the future. But no analyst putting the final full stop to a brilliant report really believes that. Do they?
So will it help when I tell you that once again the currency was the cause of the screams and yells in the dealing rooms of the nation? My charts suggest that this week the rand’s weakness was almost exactly matched by the dollar’s strength. Substantial intraday ranges in the market indices, with no discernable trends, caused dismay and confusion. As did the news that an appointment had been made to the chair of the Commission for the Promotion and the Protection of Cultural, Religious and Linguistic Rights. The fortunate incumbent has a doctorate in ethics from the University of Chicago. This also is a dubious proposition. But perhaps he will be able to tell us if the lasses aboard the buffalo are praying, and in which language. Culturally, they are nowhere.
James Greener
23 July 2004
