Look, we all know that the concept of the free market as some kind of glorious objective rational manager of all facets of human life is bullshit, right?
What utterly bugs me is how the Powers That Be – and I’m looking at you too, Labour – treat the vagaries and whims of the market like opinion polls: ignore them (often on very well-argued grounds) when they’re not good for your argument, embrace them when they are.
Latest case in point: the reaction of The Market to the NZ Power announcement. Contact’s shares promptly dropped (a little), leading the right to scream that the end times were nigh and this was proof that the Labour/Greens joint policy announcement was going to cost it the election.
But overall the NZX was up, so Grant Robertson goes declaring that this means there’s no risk of the policy causing capital flight.
It’s the same ludicrous situation we see every time The Market is made the centre of a news story. For the drop in Contact shares to be meaningful we have to simultaneously accept that The Market has made an instantaneous judgement on the future implications of the NZ Power policy … but also isn’t aware that we’re a year out from an election, that policy takes a while to implement, that there’s always the option of NZ First storming in, seizing the balance of power and refusing to do anything until we have a referendum on it.
For the rise in the NZX to be meaningful we have to believe that trading on the share market is dominated by any impulses other than whim, Chicken Little syndrome, rumours, lies, espionage, counter-espionage, and hopefully-educated guesses about the real value and future profitability of things which do not exist in concrete form.
For the drop in Contact shares combined with the rise in the NZX to be meaningful, we have to believe that The Market – at least, the bits of it that aren’t selling off Contact shares – understands the longterm implications of the policy and has judged it good. Or they’ve remembered there’s no election until 2014. Or they don’t believe Labour and the Greens will win and have the numbers and have the consistency and have the will to implement the policy in anything short of four years.
It’s like reading fucking chicken entrails, and yet it’s treated with reverence, like those guys must know something we peons don’t because they’ve got the money to play with so that makes them better than us – even when they buy so much into their own bullshit that they routinely throughout history fuck over entire societies.
I realise that rejecting The Market as the font of all wisdom would basically involve rewiring our entire political system, but … can we at least stop reacting to its every sniffle like it’s a signed affidavit?