Professor Elam

Thursday July 29, 2010

This last two weeks has seen self doubt,
cross currents of opinion, and expectations of dramatic market action
surface. Luminaries such as Barton Biggs have seemingly gone from bear
to bull, as did Richard Russell. Others like Arch Crawford believe we
will see a sort of repeat of the Harmonic Convergence of 1987. And then
it all came together for me this week on a television reality show, yep,
he's back, Anthony Robbins is here to help.

Wikipedia describes Robins as follows.

A critic of his book said it "is too wordy" and "reads like a transcript of a series of talks."^[9]
Other reviewers dispute the book's originality, pointing to ideological
similarities with Maxwell Maltz, Norman Vincent Peale, Napoleon Hill,
and Dale Carnegie.^[10] Throughout his book, Robbins freely acknowledges his indebtedness to these and other thinkers.

Note
the last name in the list. Dale Carnegie had been 'coaching' people for
years and had written two books. But it was the publication of How to Win Friends
in 1937 that shot him to national attention. Note the date, 1937. That
was the top of the huge rally from the 1932 bottom, one of the strongest
of all times. It was also the start of the second big bear market of
the 1930s. My point here is that Carnegie's timing on the book, though
he had been doing the same thing for years, could not have been better.

Hard
times, especially after an eighteen year period of steady improvement,
brings self doubt among the population. Jobs are lost (current U-6
unemployment is double digit), former star companies crumble (Dell
trades for less than ten percent of Apple, columns call for Steve
Ballmer at MSFT to resign), incumbent politicians are routed from office
(the Kennedy seat in MA, lost), the DOJ sues the state of AZ. What is
going on, how could this happen?  The answer of course is that the
business cycle has not been repealed. It is back again. But political
office is not won and anxiety is not soothed with a matter of fact, wait
another nine years and it will  likely end. People want their lives
improved NOW. This was the appeal of the entire Obama campaign.The
inability to deliver on the promise is of course now his rather than the
Bush problem.

Dale Carnegie was the original self help guru. I
recommend his book to my classes. This is a reason  for the story of
the Six Blind Men of India coupled with Carnegie's observation that we
are all the center of our personal universe. See June 12, 2010.  Robbins has been down this
same path. We have not heard from hm lately but he is back with 
television show. This week featured a wheelchair bound man needing to
restore self confidence, along with his wife.

Robbins of course
never suggests that someone needs new skills, to read books, attend
college or vocational school. Rather the idea is simply that if one
finds the inner self,one will succeed. (This is the basic self help
message, it is necessary to give it new names for new generations of
course.)  Given that most people never complete college or vocational
school there is a huge audience for such a message. For example, auto,
real estate, and insurance sales have been usually staffed with non
college grads. An economic downturn puts all these folks at risk.  In
short, you do not need to really change yourself, you are just fine.
This of course is what everyone thinks, regardless of the fact that a
changed economy may find them out of a job. The prescription that one
needs to discover him or her self by reading a book, watching a DVD,
attending a four day seminar, is a much easier 'sell.'

Economic
change brings turmoil to all. We are seeing that in market gurus
grappling with near frantic market movement that reflects the anxieties
of the participants.This is another reason big rallies happen in bear
markets. People seek a bargain only to be rebuffed by the resumption of
the downtrend. 

So, expect more self help on cable television, the
market is there, and with eight or nine years to go in the cycle, there
is money to be made, hey, you just have to find your inner self….