Monday, October 20, 2008

I just play one on TV...

I don't claim to be a market adviser, but inevitably some off-hand comment I make on camera will be miraculously right and USFR viewers will place too much weight on it.  But I would share this helpful insight into the volatility we are seeing everywhere.
The second point is an obvious one: in a market, this kind of phenomenon feeds on itself, particularly in the short-run. If traders believe that they’re going to get huge moves in the last hour of trading, then they’re likely to act in ways that create huge moves. Certainly if you were watching the market yesterday, your heart had to be beating a lot faster around 3 P.M. What was interesting about yesterday, though, was that while it seemed a foregone conclusion that we’d get a huge point move in the last hour, it was totally unclear in what direction that move would be. And that’s very different from a week and a half ago. [More]
 I don't know about you, but I now expect weird things to happen between 1 PM and 1:15 PM in Chicago.  And I'm not just talking about the Daley administration.

How will routine market moves of 20 cents in corn, 50 cents in soy and 40 in beans change our marketing? I don't think we know right now, but I suspect the toll taken on our psychological well-being will be immense unless we adopt protective measures.

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