Econ 503: How come the stock market is up and the economy is looking good? How can it? Katrina and Wilma basically destroyed New Orleans, the entire Gulf Coast, and paralyzed the Florida economy, right?

Good question, so read carefully. There is no doubt that information moves the markets; there is no other reason for markets to move. Next question is the quality of your information. If you follow the MSM, and you know they are a bunch of Liberal Democrats who need bad news to validate themselves and you think you are getting the truth something is wrong in your head. Chances are that you are getting mis-information. The really sharp guys, the guys who pay no attention whatsoever to MSM, use two kinds of information.

One is called "market generated" information which in the futures markets is expressed in "Market Profile" type of chart watching. Market generated info is traced on a bell curve and will tell you exactly the volume of trades at a certain price; you get volume per tenth of a cent. Other market info that is invaluable is volume, most active, and the info available only at Investors Business Daily so far as I know. The sharp guys only pay attention to the information generated by the market right now. Months in profit, profits rising for a time certain, what is the mutual fund participation, earnings, leading group, what is new in the company (product or management), and so on are all generated by the market, not by TV or Newspapers. And nothing else means anything.

Other information is a little more dicey; you cannot study every stock. You cannot know about management, debt (most important), new products, and so on except in one or two stocks that you are watching every day; you then act on your opinion of the "studying" you are doing and you are still gambling.

The rest of you believe that the economy MUST be in the tank because look at the destruction, listen to the pundits, read the tout sheets. You know they misinform you on everything else because of their politics, why should you believe they are telling the truth about the economy? What the fuck is New Orleans besides whore houses, bars, drunks, and music? What normal business is hurt by the termination of that shit? Stop watching TV.

Here's what the truth almost is. We have a twelve trillion dollar economy. At most we are out a few billion, maybe twelve billion, due to the hurricanes. Twelve billion is only .1% of our total wealth. It is an ant on the moon. We hardly feel it. The shipping on the Mississippi was out for less than a week so no farming or livestock were hurt. The oil rigs being down actually create employment because they have to be fixed. The housing damage ditto. The rest of the country hasn't felt a thing.

So the "news" you get on TV and MSM is slanted toward the hate Bush crowd and is so far from the truth that it can be said to be fiction, or at best about twenty percent of the total story.

The numbers are telling you the economy is good. Don't fight the numbers. And don't pay attention to anything else.