A monkey's view of the Wall Street meltdown
THE CURIOUS INVESTOR | Time for some real monkey business
The third fiscal quarter has skulked into history, leaving a scar on the American mind. With Wall Street gripped to its Guccis by crisis, I was anxious to get the viewpoint of Mr. Adam Monk, Sun-Times-affiliated monkey, master of the markets and titular head of our Monkey Manager reader stock-picking contest, for which I herewith provide an update.
Many readers have terrific entries that, given the current market, should automatically qualify them for a MacArthur Genius grant. Our leaderboard is attached to this article and the masses of us can only read it and wonder why we weren't so sharp with our investments. The person with the best performing stock at year end gets a vacation to Mexico, courtesy of Apple Vacations, but that's still a long way off, considering that year end is seven weeks after the election and the election never seems to get here.
(Al Podgorski/Sun-Times)
I wanted Mr. Monk's take on the situation and figured he'd be anxious to talk, given that the wise old cebus monkey is beating the market again. Well, the major market indexes are down 22 percent to 26 percent this year and Mr. Monk's portfolio is down about 20 percent. Hooray! You have to cherish these small victories.
But where was Mr. Monk? Determined journalistic inquiry led me, sadly, to a Chicago psychiatric facility, where dread broke my heart when I first beheld Mr. Monk, looking as disheveled as a cebus monkey can look, standing by himself in a room filled with pets, mere pets, deranged members of the animal kingdom. "Margin! More margin!" Mr. Monk shrieked.
I approached him warily and the attendant left. That's when Mr. Monk smiled and threw off a cloak. "It's an act," he said. "This is the only place where I can get any work done without being bombarded by calls. The world has figured out that I and Warren Buffett are the only ones with any money left, so I constantly get investment proposals. A guy from Sudan needed my bank account as the temporary home for millions of dollars, and his deal seemed less squirrely than an offer for a chunk of Lehman Brothers.
"So I'm investing on my own here. I bribed this place to let me have a couple laptops. I'm in business, but not even Secretary Paulson will find me!"
Investors are frightened, I said. What should they do, Mr. Monk?
"Book a trip to New York. Hotel rates are falling and you might pick up some nice foreclosures in Greenwich while you're there. But above all, keep investing in stocks. I hate to sound like a car salesman or a Realtor, but it really is a great time to buy. So act now and you can have the mortgage securities in my portfolio I've wanted to get rid of for months."
What about the bailout, Mr. Monk?
"Now there's a great approach! Credit got us in trouble and the government wants you back on that dole. Only you, Mr. Big Spender Mortgaged-to-the-Hilt, can save us from recession. The Democrats want to stop foreclosures. The Republicans want to relax accounting rules so Wall Street can hide mistakes again. It's a bipartisan license to steal.
"But we'll get through this, so I advise people to keep investing as long as you pay attention to the Lunatic Index."
What's that?
"For example, real estate went high on the Lunatic Index when college students started getting condo loans. Imagine giving money to the Future Student Loan Deadbeats of America. I knew something was wrong there. Car companies are for lunatics too. They busily churn out cars nobody can afford for the consumer tastes of five years ago.
"The big banks are in a lunatic class by themselves. They invent the 'no docs, no down, no worries' mortgage. Now they're stuck because there's no collateral, either."
But what's a good investment now?
"Morgan Stanley is out. Stanley Morgan the repo man is in. Go for the cash. I like laundromats, vending machines and currency exchanges. I personally am investing in very plush therapy centers for the well-heeled. These are people whose world is turning upside down, who are spoiled and have a sense of entitlement and are not emotionally equipped for setbacks."
Is this all because of the troubles on Wall Street, I asked.
"Who said anything about Wall Street," Mr. Monk said. "My target market is Cub fans!"
David Roeder reports on real estate every Thursday at 6:22 p.m. on Newsradio 780 WBBM. The reports are repeated at 10:22 p.m. Thursday and 7:22 a.m. Sunday.