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Brian McGrory

Wall St. flock mentality

By Brian McGrory
Globe Columnist / August 12, 2011

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LINCOLN - In my indefatigable quest to offer you, dear readers, more insight into the financial markets at this most perilous time, today I invite you on a field trip to a very special place.

If I had my way, we’d go directly to the floor of the New York Stock Exchange, where we would ask the over-caffeinated traders who are always bleating “Buy!’’ or “Sell!’’ how a national economy can be reasonably sound in the morning and be hurtling toward a depression by lunch.

Short of that, we would visit expert investment managers in their plush downtown offices to learn why a company like Bank of America is as safe as Fort Knox in July and has the same basic value as a warm bucket of spit in August. But all these important executives are too busy drowning people’s 401(k) plans in a river of tears to allow me through their hallowed doors.

It would all be amusing if it wasn’t so scary, because these money types will basically decide if I spend my 70s waddling around a golf course looking for a ball that never goes where it should, or guarding the exit of Costco pretending to care whether people’s carts match their receipts.

So in pursuit of knowledge, I bring you to the bucolic town of Lincoln, to a magical place known as Drumlin Farm, where I devoted myself yesterday to the creatures that most closely resemble all these Wall Street types: a flock of sheep.

Well, OK, they don’t physically look like the brokers and advisers. I happen to know, the difference being that the sheep are utterly adorable - an observation I made the moment I got a gander at them lying in their pen.

“Those are the goats, sir,’’ a nice farmhand said. “The sheep are behind you.’’

I knew that.

And there they were, brown and tan, innocent and fuzzy, every one of them doing exactly the same thing at exactly the same time, which was mindlessly eating from a long trough. In a while, they would follow each other into a nearby field, just because. If there was a better metaphor for Wall Street, I hadn’t heard it.

A few lambs began nudging each other across the hay floor, the office jokesters. That’s when Caroline Malone, Drumlin Farm’s livestock manager, introduced herself, listened patiently to my theory, and looked appalled at my point.

That’s not very nice, she said, adding, “These are really nice animals.’’

How often do you meet a sheep farmer with a sense of humor? And she wasn’t even done. “You should compare Wall Street with monkeys,’’ she suggested, “you know, monkey see, monkey do.’’

Seriously, people, the Dow was down 635 points on Monday, up 430 on Tuesday, down 520 on Wednesday, up 423 on Thursday. You could sit in the cafeteria of the closest junior high school and get more mature thinking. Saran Wrap has more fortitude than the people driving the financial markets.

But I’m good with all this. I really am. The key is to get inside the brains of the investment managers and make it work to our advantage. And so I pleaded with Malone to tell me everything there is to know about sheep.

“They do follow one another around,’’ Malone said. “They’re herding animals. They stay in flocks.’’

See, they are like investment managers.

“They’re very sweet and docile,’’ Malone said.

OK, so maybe they’re not. Then we get to the money question: Will sheep follow each other right off a cliff?

“They don’t tend to do that,’’ Malone said. “They stay together when they get into trouble, but the head of the flock won’t lead them into trouble.’’

I could hear the air leave my theory. Driving off Drumlin Farm, I passed a circle of sheep, looking like they were at their weekly book club. I had arrived for a lesson, but left with a wish: If only the flocks on Wall Street were as smart as my new woolly friends.

McGrory is a Globe columnist. He can be reached at mcgrory@globe.com.

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