For me, religion is something to fall back upon when everything goes wrong. To this point, I feel as though there has been no god to speak of up to this point in finance, making “believing” that the market will recover ridiculously difficult when you are watching your wealth bleed away. Having no recovery to believe in, panic selling is triggered, and the markets begin to fall.
What if, though, that someone, or something in the market can immediately swing market sentiment in the other direction, and encourage a rally within the most dire of situations. Two people I can think of approach this status of a market god: Ben Bernanke and Warren Buffet.
I’m not necessarily referring to Ben Bernanke, but more to the Chairman of the Federal Reserve. Always at the front lines dictating the movement of the country financially (though some people disagree), the chairman of the federal reserve has a sway on the market that is unmatched by anyone else. The sheer power of monetary tools (the mere notion of a potential round of quantitative easing is enough to start drawing speculation in the market) gives the chairman of the federal reserve quite some power in the market.
Warren Buffet’s investments mean much more than the money itself. Buffet drops big deals on big companies for more than just “investment”, in my opinion. I feel as though his act of injecting $5 billion of capital into Bank of America did much more than set him up for a handsome profit. Contrary to what their executives were saying, their bank needed capital, as public confidence was eroding fast. The act of “the” Warren Buffet investing into BofA created a stimulation of public confidence that the bank sorely needed. I feel as though another banking panic may have occurred if Buffet did not make such an investment. Not only the respect people have for him and his story of building up Berkshire Hathaway, but also the ability for Buffet to bring faith into a company that had almost none makes him, to me, a god of the market.
What’s more important in the roles of these two people is their ability to create “faith”. The markets are swung by “faith” in the economy, and whoever can create “faith” when there is none can truly save a nation. This is in my opinion why FDR was one of the greatest presidents of all time. In a period where people were losing faith in the market, he was able to create a brighter outlook at least increase the “faith” people had in the economy (though the fiscal effects of his policies are completely up for debate).
Did I miss anyone who deserves to be a “god” of the markets? Please comment below.