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The Wall Street Journal

Alessio Rastani Is Not Exactly Saying Anything All That Radical

Mark Gongloff

The Internets are ablaze with amazement over some fella named Alessio Rastani, who left jaws agape on both sides of the Atlantic by going on the teevee and saying scary things. But what he said was really not all that shocking.

There was initially a lot of debate about whether Mr. Rastani, identified during his BBC interview as an “independent trader,” was for real or a prankster. He is clearly unpolished in the BBC interview, in which he admits to going to bed every night dreaming about a recession and the rich money-making opportunities it will bring, but he appears not to be a hoax. This long interview with Emily Lambert at Forbes makes that case.

So what’s he saying that’s so mind-blowing? Kid Dynamite breaks it down and finds it shouldn’t be all that shocking:

Rastani says:

1) “Markets are ruled by fear.” Yes indeed – a well known axiom – fear and greed.

2) “The big money and the smart money…they are moving their money away to safer assets.” Well, that’s probably true – just look at Treasury yields

3) “If I see an opportunity to make money, I go with that.” Well, duh.  That’s what traders do.

4) “I go to bed every night I dream of another recession.” Is this the comment that has people up in arms?  The guy is prepared for his view of reality: that things are not as good as the talking heads want you to believe they are, and thus he’s ready to profit from a bear market.   As a fellow trader, I took Rastani to mean that he’s not positioned for the next great bull market.

5) “This economic crisis is like a cancer – if you just wait and wait hoping it’s gonna go away, just like a cancer it’s gonna grow and it’s gonna be too late. “ He goes on to say that wishful thinking won’t solve the problem and that people need to be prepared.  COMPLETELY reasonable, in my mind, especially for anyone who has been paying attention to the United States for the last three years.

Rastani then takes the view that “the Government doesn’t rule the world, Goldman Sachs rules the world.”  I’m not so sure about that one, and I don’t think he’s right that GS doesn’t care about the Euro rescue package.  It may be the case that GS doesn’t think the Euro rescue package will work (although I have seen no evidence that they believe that), but they certainly care about anything impacting markets.

Mr. Dynamite then gets to the heart of the matter here, why we media types have been forced to retire to our fainting couches over some of the things Mr. Rastani is saying:

Is our mainstream media so used to bullish talking heads – mutual fund managers talking their books and their careers – that anytime someone injects a dose of reality into a conversation, it becomes newsworthy? …

Educate yourself, be prepared, be informed.  

What a radical idea…

MarketBeat lead writer Mark Gongloff spearheads the MarketBeat team, with contributions from other Journal reporters and editors.

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