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Erica Jong Headshot

Popular Delusions and the Madness of Crowds

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October is the cruelest month -- at least for the Dow--only 30 stocks but more influential than than the price of tulips in 17h century Holland.

Stocks that were cheap last summer are so cheap now that it astounds me no one is buying. Mass hysteria has set in. The species that gave us Tulip mania and the South Sea Bubble is at it again. It's time to buy since all the pishers are selling. Time to buy since Jim Cramer -- that 21st century Barnum -- says, "sell!"

What is value? It used to be gold and silver. What is it now? Goldman Sachs? Lehman Bros, hah, J.P. Morgan? Morgan Stanley? What's in a name? A rose by any other name would smell as Paulson, Corzine or Bernanke.

Bernanke is a scholar of The Great Depression. So nu?

My best friend's father made his Fortune at Lehman Bros. when people shook hands and meant it. Then they started selling derivatives of derivatives, swaps of swaps -- and the Bush administration cheered.

Every time Bush and Bernanke speak the market tanks. Where is the ghost of FDR? Laughing. "I was called a traitor to my class" he says, giggling.

Nobody -- not even the seller -- knows what derivatives are worth. Or even what they are. Guys tried to explain 'em me and they couldn't even 'splain 'em to themselves!

Everyone wanted the commission -- even if the stuff was treif. Self-delusion is human nature.

My father and my father-in-law believed in government bonds. But what if the government is lying? And what if China is selling poisoned yuans? I watch South Park and I'm afraid of the Chinese too.

Is a currency worth anything if no one wants it? We used to buy shoes in Italy. Remember?

These are the questions of Oct 2008. I belong to a family of bears. And bulls. Some say the Dow will dip below 5000. Some say stocks are undervalued and that the sellers will be left out in the cold.

I will consult the Oracle of Delphi. She burbles that "fools sell and fools buy." She says our parents were right: the Great Depression will come again. She says: "buy low, sell high." She says: "never put own money in show business."

But even the Oracle cannot time the market.

"Your grandfather should have held US Steel in1930," she says.

Who knows?

All my forebears worked for a living. My grandfather painted portraits. My mother too. My aunt painted seascapes. My father played the drums, wrote songs, and then made his fortune in tchatchkes, made in Japan, then Taiwan, then China. My husband bills his time by the hour. The bucks sound big but there are only 24 hours in a day. I write slowly by hand. Publishing is effectively bankrupt for you unless you are Danielle Steele. It takes a year to write book and advances are going down or disappearing. I never wrote for money, but I can't swap poems for my iPhone.

I thought to spend my declining years writing poetry and teaching -- but that won't pay the Bergdorf's bill.

I think I'll move to somewhere life is cheaper. Papua New Guinea? With the ghost of Margaret Mead?

But what about my adorable grandchildren who live in New York City?

I'd really miss them in Madagascar.