60 Minutes Corollary

I suppose Time Magazine's readership is not what it used to be. But there is another mass market "magazine" that may serve the same purpose: 60 Minutes. Granted it is on TV, but it is slow enough and sufficiently mass-oriented to be a contrarian indicator much like Time. (See previous post.) And what should appear in a recent 60 Minutes segment but the European debt crisis. Now, this crisis has been like a slow-motion train wreck for at least a couple of years, but now the editors of 60 Minutes have judged it to be enough in the public consciousness, or at least close enough to the forefront thereof, to hold the attention of a mass audience for 15 or 20 minutes. It is certainly too early to say that this means that the crisis is passing. One would hope that it is. But it also brings to mind something that our grandmother used to say: Every time the weather changes, people think it is always going to be that way. When it rains, it will never stop. When there is a drought, will it ever rain? Of course the crisis will be over at some point. We wonder when that will be and how much damage it will do. 60 Minutes wondered if it will drag the US into recession. That is possible, but the US does have other trading partners, many of whom are doing great. The Pacific is now a more powerful trading area than the Atlantic, and luckily for the US, we face both oceans. My guess is that we will survive.

Cover of Time Revisited

Back in 2010 we posited the "Cover of Time" theory, i.e., that when an issue or trend appears on the cover of Time Magazine, it is a contrarian indicator, and the trend is about to reverse. We were wondering at the time if housing prices, which had appeared on Time's cover, were going to reverse trend. They haven't done so yet; it takes a long time to change the course of a ship that size. But a recent report in The Economist asserts that housing prices in the US are now undervalued. (The Economist is not a contrarian indicator. They predicted the housing slump at least five years before it happened.) Also on that subject, anecdotal evidence suggests that real estate sales, at least on Cape Cod, are brisk right now. A lot of closings are happening. Properties are changing hands.