It’s Star Wars day. May the Fourth be with you!
There’s a surprising amount of economics in the Star Wars movies (and not just mind-numbing discussions about intergalactic trade disputes).
Here are four memorable quotes that are not only repeated throughout the franchise but are also unexpectedly relevant to the stock market today.
Han Solo delivered this iconic excuse to Princess Leia twice after the Millennium Falcon failed to make the jump to lightspeed to escape Imperial Star Destroyers. Lando Calrissian employed it when he encountered the same problem. And then Han said it to Jabba after getting sidetracked on his way to pay up some money he owed the Hutt crime lord.
Today, the stock market is reeling as Donald Trump and China play the blame game over coronavirus. Both sides are saying, “It’s not my fault!” The dispute is threatening to blow up into another trade war.
And trade disputes are so Star Wars Episode I: The Phantom Menace. Let’s just be glad there’s no Jar Jar Binks involved in this trade war.
Famous for recycling catchy lines from the original trilogy, the Star Wars prequels popularized a few new ones too.
The Phantom Menace gave fans “You assume too much,” which was uttered by Queen Amidala in disguise as Padme to Qui-Gon Jinn. Trade Federation Viceroy Nute Gunray later said it to Padme.
Investors who are bullish about the stunning stock market rally that occurred in April may have assumed too much as well. Equities rallied exuberantly while the economy crashed and burned all around us.
Many were projecting a swift recovery and a stock market bottom at hand, assuming a near-perfect recovery from the coronavirus . In May, equities are flatlining.
Of all the Star Wars quotes that appear over and over, the most iconic line might be: “I’ve got a bad feeling about this.”
Luke Skywalker introduced it when Obi-Wan revealed, “That’s no moon. It’s a space station.” Then Han Solo said it in the Death Star trash compactor, and later when the Ewoks started cooking him. Princess Leia uttered it in the asteroid cave in The Empire Strikes Back.
Obi-Wan resurrected it (twice) in the prequel trilogy, while Anakin said it once. And it continues to appear in the Disney productions as well.
Back on Wall Street, quite a few analysts have a bad feeling about the stock market. CNBC’s Jim Cramer said this is a year he agrees with the advice to “sell in May and go away.” Rosenberg Research & Associates’ chief strategist has a bad feeling about the latest industrial sector data. Stifel strategist Barry Bannister says the S&P 500 has hit a ceiling .
Han Solo delivered this line after a narrow escape from Stormtroopers as the Millennium Falcon speed away from Tatooine in A New Hope. They were on their way to Alderaan with stolen Imperial Death Star plans. Anakin Skywalker said, “This is where the fun begins” in the Revenge of the Sith battle above Coruscant.
Warren Buffett echoed this sentiment in a 2010 letter to Berkshire Hathaway (NSYE:BRK.A) shareholders, remarking on the stock market chaos of the previous two years:
It’s been an ideal period for investors: A climate of fear is their best friend. Those who invest only when commentators are upbeat end up paying a heavy price for meaningless reassurance.
Securities day traders love volatile markets like this one, which is prompting retail investors to jump into equities in record numbers . They think this is where the fun begins too.