If you had a friend that was either depressed or anxious all the time, what would you recommend? Well, the fact is, I have several friends just like that. One of them is on Zoloft and it really helps him with his hypochondria. I have another that swears by his Prozac. Helps him with his ADD and non-specific anxiety. And of course there's my friend Larry, who really couldn't do anything about his twitchy leg syndrome without his Lexapro.
So what kind of meds do you think would be appropriate for the stock market? Having struggled through periodic bouts of bi-polar depression and mania over the course of the last several years, it is now suffering from Generalized Anxiety Disorder, which is defined by wikipedia as "an anxiety disorder that is characterized by excessive, uncontrollable and often irrational worry about everyday things that is disproportionate to the actual source of worry. This excessive worry often interferes with daily functioning, as individuals suffering GAD typically anticipate disaster, and are overly concerned about everyday matters." Individuals suffering from GAD "... exhibit a variety of physical symptoms, including fatigue, fidgeting, headaches, nausea, numbness in hands and feet, muscle tension, muscle aches, difficulty swallowing, bouts of difficulty breathing, trembling, twitching, irritability, sweating, insomnia, hot flashes and rashes."
Anybody who has been observing Wall Street these days recognizes that our friend is in some kind of difficulty not unlike this. Today, for instance, the irritable, volatile market zoomed down more than 140 points in the morning because it is nervous about new banking regulations in China and difficulties in Greece and Germany. Certainly, those are matters of concern to anybody who wants to worry about things. The point is, a healthy person would not focus on these concerns, as real as they may be, unless they were looking for something upon which to fasten a powerful, non-specific, free-floating and always potent anxiety.
I know this to be true, because I, too, suffer from a lifelong form of this ailment. I wake up feeling perfectly fine. I think to myself, "Gee, there must be something to worry about." And sure enough, inevitably, there is. Today I'm worried about a meeting I have at 11 AM. I have no reason to worry about it. But it's coloring my whole world view right now. I'm going to medicate myself right away with coffee and a session on my BlackBerry. It's too early to have a martini.
But what can we do to help the market? You've got to feel kind of bad for it. Up one day. Down the next. Worried about brainfarts taking place in Beijing and Athens.