Monday, March 30, 2009

One reason for optimism

I believe in the "magazine cover effect," too! Paul Krugman describes it as:
[W]hen you see a corporate chieftain on the cover of a glossy magazine, short the stock.
Another variation I remember came from Jack Shafer of Slate:
The leading indicator that a national trend has peaked and has begun its downward trajectory is often its appearance on the cover of one of the newsweeklies.
By this indicator, this week's Krugman cover of Newsweek ought to mean that the recovery has already begun, that Geithner's bank plan will restore stability to the financial system and that the recession will be over swiftly. The alternative, that the newsweeklies weren't late to the story, almost does seem less likely.

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