Market timing

Two anecdotes that help me make sense (of humor) out of the Lehman Bros. bankruptcy, the Merrill Lynch buyout, the Fannie/Freddie seizure, Bear Stearns debacle and all else:


Around 1991, I walked into a local-ish comic store, as is my wont. As I was checking out, I noticed that the store had the first issue of Justice League International for sale at $20. It had come out in 1987 and I had a copy at home. A semi-impoverished college student, I figured I could use a few bucks, and asked if they were buying copies of that comic.

The clerk said, “No, man. We’ve got a whole box of that issue back in the storeroom.”

“Then why are you selling it for $20?” I asked.

“Because that’s what [The Guide] says it’s worth,” he told me.

Ah: [The Guide]. I don’t recall which price guide was in vogue back then, but I think that was the beginning of the era when comic magazines were publishing revised price guides on a monthly basis.

“But [The Guide] doesn’t make money selling copies of JLI #1,” I replied. “It makes money selling copies of [The Guide]. You oughtta put ‘HALF-OFF!’ signs up and I bet you could move the whole box pretty quickly.”

“But [The Guide] says they’re worth $20!”

“It’s only worth what you can get for it,” I said. Never let it be said I didn’t learn anything from my dad.

Mark to market. That’s why Lehman Bros. went into bankruptcy while Merrill Lynch managed to get itself bought.


My next-door neighbor took his stockbroker exam in October 1987. This was three days before the Black Monday collapse, in which the Dow tanked 22%. He went on to work as a substitute teacher in our high school for the next several years.

In that spirit, congratulations to Slate, which launched its new business/finance site, The Big Money, yesterday.

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