South Park Weighs In On The Financial Crisis

The recent South Park episode titled Margaritaville does not give the single worst recap of the financial crisis you will find and even if you are not a fan of the show you will probably laugh at least a couple of times.

You can watch online here.

The show is a humorous and simplistic deconstruction of the whole thing but I pulled one other thing out that while funny is also very true and something I have been writing about for ages.

The screen shot I captured is of Randy Marsh in the middle of a lecture/rant to his family about how frivolous spending ruined the economy. He then continues on the same jag and emerges as a leader of sorts with his economic theories. As he stresses that people should only spend money on the barest of necessities he includes margaritas on this very short list of items that are essential.

While most of us can laugh at the idea of a margarita machine being indispensable many of us take on absurd expenses that we are just as blind to as Randy and his margarita machine. The best thing I can say, because I am terrible at actually having this conversation with people, is that hopefully anyone who is as blind to something as Randy is to the margarita machine can muster the introspection to recognize the behavior.

Now a little about the market’s most recent sell off. At this point it is unlikely that too many people are having an emotional response to the what might be the end of the rally. At some point on the way down, if indeed that is the direction we are headed, emotion will come to the surface, this is a typical and reasonable human behavior. Getting out in front of the possibility before it happens mitigates the chance of succumbing to the emotion.

I make this same point often because I am convinced that realizing ahead of time that in general markets go down sometimes and more specifically the normal path out of a bear market includes being faked out helps make the ride easier which is crucial to long term success. Those stats about mutual fund holders badly lagging the mutual funds they own comes from selling low and buying high.

In addition to knowing the market goes down occasionally it is important to realize that human behavior is the biggest detriment to long term investing success (no data to back that up, just my opinion). The blog posts on this topic serve as my attempt to get the concept through to readers and obviously clients who read the site.

This is also the motive for taking defensive action, raising a lot of cash when I did and generally wanting to not look a whole lot like the market while the S&P 500 is below its 200 DMA, it makes enduring the event much easier.

11 Comments

  1. Not your fault. But the link to the Southpark clip does not work. Video has been removed due to copyright violation. Thought you would want to know. Keep up the good work.

    Reply
  2. I cannot agree with your implication that alcohol is a non-essential.

    Reply
  3. actualy the implication that margaritas delivered through an expensive machine needing to be bought on credit is unnecessary.

    actually i am not much of a drinker.

    Reply
  4. Not much of a drinker? Oh well, nobody’s perfect.

    Reply
  5. hasn’t really worked out for some people i know so I’m very minimal.

    Reply
  6. Roger
    With all the talk about the government printing dollars like crazy, isn’t a similiar scenario accomplished by all these corporations offering huge options and stock incentives to their executives. In addition to diluting stock, where does this “free” money come from?

    Reply
  7. to hear Fritz tell it the coin is coming from the government.

    Reply
  8. …and ye shall rise from the debt.

    Reply

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South Park Weighs In On The Financial Crisis

The recent South Park episode titled Margaritaville does not give the single worst recap of the financial crisis you will find and even if you are not a fan of the show you will probably laugh at least a couple of times.

You can watch online here.

The show is a humorous and simplistic deconstruction of the whole thing but I pulled one other thing out that while funny is also very true and something I have been writing about for ages.

The screen shot I captured is of Randy Marsh in the middle of a lecture/rant to his family about how frivolous spending ruined the economy. He then continues on the same jag and emerges as a leader of sorts with his economic theories. As he stresses that people should only spend money on the barest of necessities he includes margaritas on this very short list of items that are essential.

While most of us can laugh at the idea of a margarita machine being indispensable many of us take on absurd expenses that we are just as blind to as Randy and his margarita machine. The best thing I can say, because I am terrible at actually having this conversation with people, is that hopefully anyone who is as blind to something as Randy is to the margarita machine can muster the introspection to recognize the behavior.

Now a little about the market’s most recent sell off. At this point it is unlikely that too many people are having an emotional response to the what might be the end of the rally. At some point on the way down, if indeed that is the direction we are headed, emotion will come to the surface, this is a typical and reasonable human behavior. Getting out in front of the possibility before it happens mitigates the chance of succumbing to the emotion.

I make this same point often because I am convinced that realizing ahead of time that in general markets go down sometimes and more specifically the normal path out of a bear market includes being faked out helps make the ride easier which is crucial to long term success. Those stats about mutual fund holders badly lagging the mutual funds they own comes from selling low and buying high.

In addition to knowing the market goes down occasionally it is important to realize that human behavior is the biggest detriment to long term investing success (no data to back that up, just my opinion). The blog posts on this topic serve as my attempt to get the concept through to readers and obviously clients who read the site.

This is also the motive for taking defensive action, raising a lot of cash when I did and generally wanting to not look a whole lot like the market while the S&P 500 is below its 200 DMA, it makes enduring the event much easier.

Submit a Comment

Your email address will not be published.

WP-SpamFree by Pole Position Marketing