Lords of Fun

In two recent posts, I established that eating a doughnut during trading hours causes the stock market to fall. It has, however, fallen over the last three days without me eating a doughnut. There are only three possible explanations for the recent decline in stock prices.

1) The stock market is looking at a moving average of my doughnut eating. So, it might be thinking that I am still eating 0.37 doughnuts a day. ie DE(t) = .5*DE(t) - .108DE(t-1) + .22DE(t-2) +.37DE(t-3) + e(t) where DE = doughnuts eaten. The rest of the equation is obvious.

2) Someone else is eating a doughnut during market hours. If you are, stop it!

3) The stock market is even more complex or simpler than suspected.

- Paul De Lancey, First Lord of Fun
Please visit my website at www.lordsoffun.com

= Yesterday, I had a doughnut. By the time I had finished, the S&P 500 Index had fallen 0.33%. Being an economist, I immediately hypothesized eating a doughnut caused the stock market to fall.

I’m no ranter. I use proof to back my assertions. So this morning when the urge to eat a doughnut struck me, I forebore and noted the S&P 500 Index. It was up 0.23%. Five minutes later, the time to properly eat a doughnut, the Index was still up 0.23%

Eating a doughnut during stock-market hours causes the market to fall! The proof is there. Don’t eat that doughnut during market hours. Do not! We will have another recession if you do and isn’t this one enough?

By the way, if I ever open a doughnut shop my slogan will be, “Market Doughnuts, made from real dough.”

Can my Nobel Prize in Economics be far behind. Taks a mikka.

- Paul De Lancey, First Lord of Fun
Please visit my doughnut-free website at www.lordsoffun.com

= The stock market was up 0.30% this morning. Then I had a doughnut. By the time I had finished, the market was down 0.03%. Sorry. In the interest of full disclosure, I dunked the doughnut in milk and brushed my teeth afterward. Perhaps there are complicating factors in the world of finance. But I know this, I won’t have a doughnut while the stock market is open.

- Paul De Lancey, First Lord of Fun
Please have clean teeth when you visit my website at www.lordsoffun.com