Full Steam Ahead

Don’t look now, Fellow Reckoner. It’s the market’s turn to vote!

Stocks fell this morning. Hard. Last we checked, the Dow was down by more than 300 points. Gold dipped too, shaving $20 off the previous session’s $45 per ounce gain. And energy prices were down across the board, with a barrel of oil trading just a touch above $85.

What’s happening, Johns and Janes want to know? What’s going on in the vast, gaping, chasm separating the realm of lofty electioneering pomp and the honest, workaday reality in which the rest of us reside? Nobody knows for certain. We can only guess…

Maybe investors thought Mitt was their man, that he would carry forward real change…the kind Obama promised but never delivered. Maybe they thought the spending would stop under a Republican president, that finally some semblance of sanity would return to the budget numbers. Perhaps they envisioned another “Morning in America” moment, where the country would, united once again, march boldly, bravely and stupidly into the future.

Mitt certainly talked the talk. In fact, he talked whatever talk was required of him. A man of thoroughly independent non-thinking, he seemed to be both for and against whatever it was his audience told him they wanted on the day, as if he would be able to deliver all their wants and needs. Hey, what’s not to like? In the battle of ideas, Obama clearly came with all the wrong ones. Mitt, however, arrived empty handed, but ready to accept donations. Maybe investors saw this as a good thing, something about which to get excited?

If so, it could be that these folk are a tad sore today. Could be that they’re selling their stocks and cashing out of the American Dream. Maybe they’ll take their money elsewhere, to other, more promising markets around the world.

That’s one possible explanation for today’s market selloff. One version. You can construct whatever narrative you so wish. It’s all guesswork in the end. More than that, it’s storytelling. We take moments in time, moments we believe to be pivotal — elections, declarations of war, signs from the gods — and arrange them to suite our own version of events. Humans are, after all, pattern-seeking creatures. We enjoy a good yarn, something to help us make sense of the terminal mystery that surrounds us. Then we wrap ourselves in our little story and, comforted by its supposed truth, its claim on impossible knowledge, we get on with our lives.

Today, America embarks on the next Olympiad in her journey. We have no clue where these four years will take her, over rough seas or calm. But we’re fairly certain last night’s victor — regardless of who had won — will be of any real consequence to the voyage. In the end, all ships must sink. And for every Titanic, there’s a sea of deep, blue icebergs.

It’s not that we’re fatalists, mind you. Ahead of any nation there lies virtually infinite possibilities, including, but not limited to, outright extinction. Who in China’s Qing Dynasty, which lasted until 1911, could have known the Middle Kingdom would later that same century run crimson with the blood of a Cultural Revolution or a Great Leap Forward? Which Prussian peasant, upon hearing the news, in 1871, of the creation of a new, invincible German Empire, could have foreseen anything like the madness of The Final Solution? And which common blacksmith, when hearing the words of the Founding Father’s noble experiment, might have ventured a guess that the United States would one day wage undeclared wars on a dozen foreign borders while standing as the world’s largest debtor?

Just as no one person can really know the future of complex societies, neither can any one, single person direct it. To suppose as much is to imagine the cart pushing the horse, or the bobbing life raft guiding carefully the course of the great ship in front of it.

Still, every good story needs a protagonist…and an antagonist. Some people will blame today’s market selloff — and whatever comes afterward — on the result of the presidential election. Others will imagine alternative scenarios, the “what ifs” of a Romney victory. But it matters not. The needle of time is pointed at “Full Steam Ahead”…wherever that may take us.

Joel Bowman
for The Daily Reckoning

The Daily Reckoning