Here Comes the Hun
The Week in Review -- September 25, 1998
by Jerry Thomas ([email protected])
Okay. The week in review. The market went up some. The market went down some. Yadda yadda.
Now suppose you were living 1500 years ago, say A.D. 450 (give or take), and you sat down Wednesday morning with your cup of espresso and cracked open the Wall Street Journal Ancient Edition, only to spot a headline that read:
Attila Says: Civilization Is Bad for Romans
Leading Hun at Nation's Top Mongol Horde Wants to Slap Warning Label on Fortified City-States
I suppose, upon reading this, you might want to question Mr. Attila's motives for making such a provocative statement. The fact that you suspect he might like to plunder your citadel would give you pause.
Or say you were instead reading that newspaper in a Starbucks long, long ago, in a galaxy far, far away. And this time the headline read:
Darth Vader Says Good Side of Force Leads Investors Astray
DAGOBAH -- Darth Vader, a top executive at one of this nation's leading Galactic Empires, warns that the so-called "Good Side" of the Force can turn Jedis into drooling, day-trading zombies...
Not terribly convincing, eh?
So consider our glee in Fooldom when Wednesday's real Wall Street Journal arrived with an article on Merrill Lynch's John "Launny" Steffens and his crusade to convince investors that if they dare to manage their own investments, they are flirting with disaster. "The do-it-yourself model of investing," he said, "centered on Internet trading, should be regarded as a serious threat to Americans' financial lives."
The wags at Fool HQ made short work of that remark, firing off a press release mocking this Wise pomposity. "The Motley Fool Says Online Trading Is Bad for Merrill Lynch," read our version of the headline. Fool Bill Barker (TMF Max) even went so far as to call the comments from Steffens a "Ceausescu moment," a phrase explained with savory irony in David Gardner's Thursday Fool Portfolio Report. All in all, it was Fish in a Barrel Time for Fools looking for easy Wise targets.
One wonders about the future of full-service brokerages, especially when the walls of their own fortifications are crumbling at such a rapid pace. Research and analysis, once a carefully guarded propriety of the Wall Street Guild, is becoming increasingly commoditized online. Stock Quotes are easily available. The government's Edgar database brings you, with a few clicks of your mouse, reams of SEC filings -- the very source of the data Wall Street's elite uses to analyze America's publicly traded companies.
Fooldom itself is bursting with free information. A case in point: Follow Brian Graney (TMF Panic) as he interviews Dave Hitz, founder of Network Appliance, Inc. (Nasdaq: NTAP) in our latest StockTalk piece. It wasn't long ago when this kind of primary research was impossible for small investors to come by without paying hefty fees to someone in a dark suit. But now it shines on the Web, available to anyone with a modem -- for free.
"Do-it-yourself investing is a serious threat to Americans' financial lives," said John Steffens. A threat to our lives!
In Fooldom, we live dangerously. You can take your life into your own hands every morning starting with our new Breakfast with the Fool feature. "Breakfast" was launched just this week and rounds out our three squares of Foolish nourishment per day (along with the Lunchtime News and Evening News ). One reader called it "the best thing since orange juice."
Speaking of threats to your financial life, you might also want to read Thursday's Fool Plate Special commentary from Louis Corrigan (TMF Seymor). Here Louis examines the catastrophe that is Long-Term Capital Management, a hedge fund that has managed its shareholder's investment into near oblivion. Long-Term (a name that is surely the Mother of All Misnomers) bet the wrong way on a number of extremely leveraged positions and Poof! went more than half the funds assets, resulting in a bailout that left the original investors with pennies on the dollar.
And who do you think helped raise much of that initial capital? None other than the aforementioned Merrill Lynch. But let Louis tell the story.
Round out your Foolish weekend reading with a few other choice pieces. In Wednesday's Cash-King Report, Rick Aristotle Munarriz (TMF Edible) helps you understand the Cash-King approach to investing with a walk though Charlie's Chocolate Factory. In this week's Dueling Fools feature, Louis Corrigan and David Forrest (TMF Bogey) pummel each other over the prospects of Big Blue, aka IBM (NYSE: IBM).
Finally, for fun, play The Foolywed Game! No, Bob Eubanks is nowhere in sight, but you can still compete for fabulous prizes, chosen just for you (or whoever else might happen to win)!
Even if you don't win, I can pretty much guarantee it'll be more fun than fending off attacking Huns from the battlements of your castle.
Until next week,