Magazine Covers Do Not Mark Bottoms

While researching the Magazine Cover Effect, I came across this one from the October 20, 2008  New Yorker.

It is a classic and captures the worst fears at the time complete with not only historical allusions of the stock market in America but to the death of Wall Street and of those clutching and beholden to it.

It was created by famed portrait artist Robert Risko, a protege of Warhol, who has produced countless covers for Vanity Fair, The New Yorker and Rolling Stone.

The $SPX closed that day at 985 but didn’t bottom for another 5 months in March of 2009 more than 25% lower.

To me, the significance of pointing this cover out and the timing of it goes further than just the myths we’ve create due to the biases our imperfect and emotionally shaded memories construct.

It carries over to other less striking but similarly mistaken cues.

If you notice a magazine cover or a mall kiosk offering to buy your gold or the last bull on Wall Street gone cataclysmically bearish on the CNBC, it is nothing more than a reflection of the times and certainly not a sign post of an impending inflection.

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